2014 ANNUALREPORT - listed companytta.listedcompany.com/misc/ar/20150108-tta-ar-2014-en.pdf · ANNUAL REPORT 2014 009 ChAIrmAn messAGe For Thoresen Thai Agencies Public Company Limited

R E B I R T H

ANNUAL2 0 1 4

REPORT

THORESEN THAI AGENCIES PLC

T H O R E S E N T H A I A G E N C I E S P L CBANNUAL REPORT 2014

ANNUAL REPORT 2014 001

“To be the most Trusted Asian Investment Group by 2020, consistently delivering

enhanced stakeholder experience.”

T T A ’ S N E W V I S I O N

T H O R E S E N T H A I A G E N C I E S P L C002

I m p o r T A n T C h A n G e s A n d d e v e l o p m e n T s

201120102009

• Thoresen Thai AgenciesPlc.(“TTA”)establishedSoleadoHoldingsPte. Ltd. (“Soleado”)as an investment hold ingcompanyforprojects,assets,orcompaniesoutsideofThailand.

• TTA acquired an 89.55%stakeinUniqueMiningServicesPlc. (“UMS”), a coal logisticscompany in Thailand, as partof its strategy to create anintegratedcoalbusiness.

• Soleado acquired a 100%stake in Baconco Co., Ltd.,(“Baconco”)afertilizercompanyin V ie tnam and acqu i reda21.18%stakeinMertonGroup(Cyprus) Ltd., (“Merton”)whichhasacoalminingjointventureinthePhilippines.

•Me rma id Ma r i t ime P l c .(“Mermaid”) raised SGD 156millionbywayofarights issuetopursueitsbusinessgrowth.

• Soleado acquired a 38.83%stakeinPetroliftInc.(“Petrolift”)a petroleum tankercompany inthePhilippines.

•Mermaid acquired a 100%s take in Subtech L td . inSeychellestoexpanditssubseaeng i nee r i ng se r v i c es i ntheMiddleEast.

• TTA issued unsubordinatedand unsecured domes t i cdebentures of Baht 4.0 billionto refinanceexisting loansandtoincreaseworkingcapital.

• TTA acquired four dry bulkvessels, three in the second-handmarketandonenewbuildvessel. Mermaidacquiredonesecond-hand and three newbuildsubseavessels.

• Soleadoacquireda20%stakein Baria Serece as part of itsstrategytocreateanintegratedlogisticsbusinessinVietnam.

• TTA acquired three dry bulkvessels,twointhesecond-handmarketandonenewbuildvessel.

•Soleadoacquiredanadditional1.67% ownership in Petrolifttohave40%ownership.

• Soleado acquired 33.33%ofQingMeiPte.Ltd.(“QingMei”)to develop a new coal-miningprojectinIndonesia.

•AsiaOffshoreDrillingLimited(“AOD”), a 33.76% associatecompany of Mermaid, raisedUSD 180 mil l ion from theinternational capital marketsand signed contracts to buildthreejack-uprigsworthUSD538millionwith Singapore KeppelFELSLimited(“KeppelFELS”).

ImPORTANT ChANgES ANd dEVELOPmENTS


2012 - 2013 2014

2012• TTAacquiredonesecond-handdry bulk vessel. The businessrestructuringofdrybulkshippingwas completed, as eight ThaiflaggedvesselsweretransferredtoThoresenShippingSingaporePte.Ltd.(“TSS”).

• TTA’s convert ib le bondsmaturedon24September2012.

2013• TSS acquired three dry bulkvessels, one second-handandtwo new build vessels. AODtookdeliveryofthreenewbuildjack-uprigs.

• TTA established ThoresenShipping Denmark APS asa commercial office based inCopenhagen,DenmarktoserveitsEuropeanclientbase.

• TTAraisedBaht3,964millionby way of a rights issue incombination with warrants topurchase ordinary shares ofTTA (TTA-W3) to pursue itsbusinessgrowth.

•Mermaid raisedSGD175.78millionbywayofarights issuetopursueitsbusinessgrowth.

• TSSacquiredsixsecond-handdrybulkvessels.

• PremoShippingPlc.,a99.9%owned subsidiary of TTA,wasestablished as a result of anamalgamat ion of 45 Thaidormant shipping companiestoincreaseoperatingefficienciesbothintermsofrevenueandcostmanagement.

• TTA established ThoresenShippingSouthAfrica(PTY)Ltd.as a commercial office basedin South Africa to serve bothexisting European client baseandalsonewSouthAfricanclientbase.

• PMThoresenAsiaHoldingsPlc. (“PMTA”), a TTA’swhollyowned ho ld ing companyinvesting in 100%ofBaconco,wasestablishedon7June2013andwas converted to a publiccompanylimitedon4February2014.

• TTAdisposed the investmentin PT Perusahaan PelayaranEquinox(“Equinox”),Indonesia,a49%stakeownedbyTTA,on29January2014.

•Mermaid’s subsidiary,MTR-3(Singapore) Pte. Ltd.,MTR-4(Singapore) Pte. Ltd., andMermaidOffshoreServicesPte.Ltd.,enteredintotheagreementstobuildtwonewtenderrigsandone new dive support vesselwithChinaMerchants IndustryHold ings Co., Ltd. for anaggregate sum of USD 436millionon9January2014.

• TTAraisedBaht4,174millionby way of a rights issue incombination with warrants topurchaseordinarysharesofTTA(TTA-W4)topursueitsbusinessgrowth.

• The total owned fleet as of30September2014consistedof24drybulkvessels,sixoffshorevessels,twotenderdrillingrigs,and three jack-up rigs (33.76%ownedbyMermaid).Additionally,approximately 18 ful l - t imeequivalent dry bulk vesselswerecharteredintomeetclientdemandduringtheyear.

ImPORTANT ChANgES ANd dEVELOPmENTS


C o n -T e n T s


002 Important Changes and Developments

006 Honorary Chairman Statement

008 Chairman Message

010 CEO Message

013 Audit Committee Report

016 Board of Directors and Executive Officers

026 Business Review and Outlook

064 Corporate Social Responsibility and Sustainability Development Policies

071 Financial Highlights

072 Management Discussion and Analysis

082 Statement of the Board of Directors Responsibilities for the Financial Statements

083 Consolidated and Company Financial Statements

170 Management Structure

180 Income Structure

181 Remuneration of Auditors

182 Risk Factors

191 Securities Holding by Directors and Executives

193 Shareholding Structure

194 Dividend Policy

195 Corporate Governance Report

211 Internal Control and Risk Management

213 Related Party Transactions

218 Company Investments

221 Glossary

224 Company Information


prayudh mahag i ts i r i , honorary Cha i rman

W E A R E m O V I N g f O R W A R d I N

A C O N S T R U C T I V E m A N N E R

“

“

hONORARy ChAIRmAN STATEmENT




ChAIrmAn messAGe

For Thoresen Thai AgenciesPublicCompany Limited

(“TTA”orthe“Group”),2014provedtobearebirthinmany

respects.TTAreturnedtoprofitabilityandmadeimportant

operationalenhancementstoensurethepositivewindsof

changebringsustainablesuccess.

OurTransportGroupreboundedinprofitabilityforthefirst

timeinthreeyearsprimarilyonthebackoflowercostsand

improving industry headwinds for ThoresenShipping.

MermaidpacedourEnergyGroup toastrongrebound,

benefitingfromincreasedequityincomefromAOD,while

our InfrastructureGroupwas once again buoyed by a

record performance from Baconco. UMS remains a

turnaroundinprogressbutwearebeginningtoturnthe

corner. And in the first quarter financial year 2015,

TTAaddedafourthgroupthatwillhousenon-coregrowth

investments followingouracquisitionofSinoGrandness

FoodIndustryGrouplimited(“SinoGrandness”)inOctober

2014.

Overandabovetheoverwhelminglypositiveresults,TTA’s

rebirthisbeingfosteredfromagrassrootslevel.InAugust,

theGroup’smanagement teamarticulated new vision

andmissiontomobilizetheorganizationtowardsanew,

well-definedsetofaimsandobjectives.Forshareholders,

employees, partners and customers, our vision stands

asatestamenttothetypeoforganizationTTAisbecoming,

andbreatheslifeintotherebirthoftheCompany.

Ournewvisionreadsasfollows:

“To be the most Trusted Asian Investment Group by

2020, consistently delivering enhanced stakeholder

experience.”

Thisstatementismadeoftwoequallyimportantclauses.

Thefirstcompelsustoactwithintegrityandconsistently

earn trust even as we scale up our operations and

investments.Wemustconstantlystrivetohaveapositive

impact on the economy, community, and environment,

so that we can earn trust and respect as we grow

sustainably.Wemustsetourstandardsnotonlytoachieve

excellence inThailand, but alsoanAsia-wideobjective

thatmatchestheGroup’scurrentportfolioofinvestments

aswellasouraspirationtodelivervalueattheregional

level.Thesecondclauseholdsustoneverlosesightof

the best interests of our various stakeholders.Starting

withshareholders,thisreflectsourpledgetoalwaysvalue

thetrustandexpectationstheyhaveoftheGroup.Atthe

same time,weare seeking to deliver thebest benefits

toemployeesandtoincentivizetheircontinuedcommitment

toachievingourdesiredresults.Inparallel,wemustalways

betransparentandaccountabletoourpartners,customers,

communityleadersandgovernmentagenciesinorderto

buildrealtrust.

Thisvision,whichistheproductofmuchsoulsearching

anddiscussionamongstmanagement,employeesandthe

Board,willunifyourcollectiveeffortsinthecomingyears.

Itwill guide us towards a successful future. Itwill help

toensure thatTTAnotonlysucceedsat its rebirth,but

alsogrowsinlinewithitsaspirationsoverthelongterm.

ToevolveintothemostTrustedAsianInvestmentGroupby

2020isanaudaciousgoal.Itmarksaboldpathforward

for theGroup. But canwe achieve it? Demonstrable

successesacrossourbusinesses in2014areevidence

thatTTAisindeedontherightpath,andwiththevisionwe

havesetforourselves,Ihaveeveryreasontobelievethat

thegoalcanindeedbeaccomplished.

Sincerelyyours,

PrasertBunsumpun

Chairman

ChAIRmAN mESSAgE



Iamproudtoreportthatwehavedeliveredastrongyearofgrowthandsolid financialperformance. Weentered2014afteraverychallengingpreviousyear,duringwhichwehadtotakesignificantimpairmentsandwrite-downs,andwemadechangesintheseniorleadershipteam.

Thesestrategicmovesweremadeinordertoformastrongplatformuponwhichfuturegrowthcouldbebuilt.Ibelievewe have demonstrated this year, that these effortshave paid dividends. 2014was a turnaround year ofpositiveresultsforTTA,withgrowthacrossallconsolidatedfigures.Revenue, gross profit, equity income,EBITDAand net profit all showed strong growth. For the yearended30September2014,TTArecordednetprofitofTHB1,015millionandearningspershareofTHB0.79.

Consolidatedrevenuesgrew16%toTHB21,431million,primarily driven by strong top-line performance fromThoresenShipping,MermaidMaritimeandBaconco,allofwhichdeliveredstrongresults,inmanycasesconsistentlydeliveringrecordhighs.

While our existing portfoliowent througha rebirth anddeliveredrecordresults,wealsotooktheopportunitytorealignourvisionmissionandgoals,whichformsthebasisofournextgrowthdrive.Asaresultofthis,wemadethedecisiontoraiseTHB4,174millioninadditionalfinancingthrougharightsissuewhichhasbeeninvestedinbothourcurrentportfoliocompaniesinordertoaccelerategrowth,butalsoinnewbusinessesthatarepartofanewdrivetofurtherdiversifyourportfolio.

Strengthened existing businesses

Wecontinuetomaintainastrongfocusonstrengtheningourexistingportfolio,whereweaimtoderive80%ofourfuture growth. In 2014,weannouncedplans to listPMThoresenAsiaHoldingsPlc.(“PMTA”)inordertocreatea solid financial platform thatwill support future growthforBaconcoandwillhelpthecompanyrealizeitsmarketvalue.

ThoresenShippingalsofurthersolidifieditspositionasoneoftheleadingdry-bulkshippingprovidersintheworld,byexpandingitsfleetanditsgeographicalfootprint.In2014,thecompanyinvestedmorethanTHB4.3billion(USD133million) in six new vessels as part of the fleet renewalexercise,designedtorebuildandmodernizeitsfleetwhilethemarketisatthebottomoftheassetcycletocapitalizeonpotentialupturnoftheindustry.

With a focus on profitability, Thoresen Shipping haspositionedapproximatelyhalfitsfleetintheAtlanticOcean,whichdelivershigheryieldsthantheAsiaPacificregion,butitalsodemandshigherlevelsofservice.Inordertostrengthen operations tomeet these greater serviceneeds,theCompanyalsoopenednewofficesinDenmarkand South Africa. This enables Thoresen Shippingto provide an improved service to both the existingEuropeanclientbaseandanewSouthAfricanclientbase.These strategic investments provide the companywithsignificantcompetitiveadvantages.

WehaveinvestedheavilyinMermaidMaritimetoo,asweseek to capitalize on the strong growth that has beenachievedto-date.InJanuary2014,thecompanyenteredintoagreementstobuildtwonewtenderrigsandonenewdivesupportvessel, investingmore thanTHB14billion(USD436million), as part of themanagement team’scommitment to expanding the size of theCompany’sfleetofrigsandvesselsandtoenhancingoveralloffshoreservices.TheinvestmentwillgreatlyenhanceMermaid’smarketpositionbymodernizing itsfleet,andwillenablethecompanytoachievegreatereconomiesofscale.

Tofurtherstrengthenourperformance,in2014,wealsoworkedwith our portfolio companies to streamline theiroperations.ThoresenShippingtookmeasurestomanageoperationalcosts,byreducingunnecessaryadministrativeexpensesandassociatedcostsassociatedwith45dormantshipping companies which were amalgamated anddissolved, further enhancing the company’s investmentcapabilities post-amalgamation.We also disposed ofourholdinginEquinox,duetoitnotbeingalignedwiththecorebusinessofThoresenShippingwhichterminateditslinerservicein2010.

Effortssuchasthesehelpusensureweremainfocusedandefficientacrossourportfolio.

Ceo messAGe2014 - reborn And refoCused

CEO mESSAgE


A More Diverse Portfolio on the HorizonAspartofoureffortstoidentifyinvestmentopportunitiesthat will provide accretive growth, we announced anacquisitionof9%inSinoGrandnessFoodIndustryGroupLimted(“SinoGrandness”)Thisrepresentsourfirststepinto the food and beverage industry sector,whichwebelieve presents strong growth opportunities.We arealso confident thatSinoGrandness is ideally placed tocapitalizeonthispotential,astheCompanyhasalreadydemonstrated cumulative annual growth rates of 40%since2008.More importantly,Frost&Sullivan forecastthat the loquat juice market in China, which SinoGrandness’GardenFreshbrandhasbecometheleadingbrandwithamarketshareofmorethan70%willwitnessanannualaveragecumulativegrowthrateofmorethan39%between2013and2017.

Uniquely Positioned Asian Investment Group

Itisouruniqueinvestmentstrategyandourunfailingfocusonstrivingforbuildingperformanceexcellenceinourcoreportfoliobusinessesthathasenabledustodeliverstrongperformance,anditisthistoothatwilldrivethelevelsofgrowthwehaveoursightsseton.

Asatrulyinternationalinvestmentgroup,withmorethan90%ofourportfoliolocatedininternationalmarketsandinspecializedindustries,wemaintainaninvestmentfocusonhighgrowthinternationalopportunities.Thisnetworkofoperationsprovideuswithopportunities toexplorenewpotentialinvestmentsininternationalmarkets.

ItisthisfocusedpositioningandapproachthatwebelievewillenableustoachieveourvisionofbeingthemosttrustedAsianInvestmentGroupby2020.

New Mission Goals Reflect Our New Vision

Asaninvestmentholdingcompany,weaimtomaximizeshareholder value by striving to achieve continuousandsustainablegrowth.Webelievewecandeliver thisbynurturingandsupportingourportfoliocompanies,andby identifyingand investing innewgrowthopportunitiesat both thegroupand subsidiary levels. Finallywearecommittedtocreatingapositiveimpactonthecommunitiesinwhichweoperate,havingapositiveimpactonsocietyandmanagingourimpactontheenvironment.

A Measured and Streamlined Approach

Thesuccessofourinvestmentstodatehasbeenaresultoftakingaprudentandmeasuredapproach.Webeginwithasmallinvestment,throughwhichwelearnandgainexperience,and then,oncecomfortablewewillexpandourinvestment,butonlyifitmeetsourcriteriaofprovidingfinancialstability,highgrowthandprofitability.

Outlook

Lookingahead,wearewellpositionedforfurtherstablegrowth.Wenowhaveaclearstrategyinplace,toachievebalancedandconsistentgrowthofourexistingportfolio,andtofurtherdiversifythroughstrategicopportunitiesthathelpusmeetorexceedourtargetedlong-termreturnsoncapital.

This strategy is underpinned by the sound financialfoundation we have in place, based upon three keypillars–namelyhavinganoptimalcapitalstructure,beingin a strong position to service our debts and havingadequatefinancialliquidity.

OurlongtermgoalistogrowourmarketcapitalizationtoTHB50billionand tobecomeamemberof theSET50Indexby2017.This isa loftygoal,but it isonethatwebelievewenowhavetheplatforminplacetoachieve.

IwouldliketoexpressmygratitudetotheentireteamatTTA,aswellastoalloftheemployeesatoursubsidiaries,andourpartners,fortheirloyaltyanddedication.IwouldalsoliketothanktheBoardofDirectors,fortheircontinuedsoundguidanceandsupport,andofcourse toyou,ourShareholdersforyourcontinuedtrustinourCompany.

Weenter2015proudandconfident.

ChalermchaiMahagitsiriPresidentandCEO

CEO mESSAgE


AudIT CommITTee reporT

To the Shareholders of Thoresen Thai Agencies Public Company Limited

TheAuditCommittee(“theCommittee”)consistsofMr.KrishFollett,ChairmanoftheCommittee,Mr.SantiBangor,andMr.CherdpongSiriwit,allofwhomarefinanciallyliterate,independent,andnon-executivedirectors.ThesecretarytotheCommitteeisMs.RunpaveeDaengnoy,whoalsoservesasDirector,InternalAudit.AlltheCommittee’smemberspossessadequatequalificationsfortheirpostsasspecifiedbytheAuditCommitteeCharterandinaccordancewiththeSecuritiesandExchangeCommissionandtheStockExchangeofThailandregulationsandbestpracticeguidelines.

TheCommitteeconvenedtwelvemeetingsduringtheyear,andtheCommitteemeetingattendancesrecordsareshownbelow.

No. Audit Committee Member Position No. of Meeting Attendance

1 Mr.KrishFollett AuditCommitteeChairman 12/12

2 Mr.SantiBangor AuditCommitteeMember 12/12

3 Mr.CherdpongSiriwit AuditCommitteeMember 11/12

RESPONSIBILITIES

ThekeyresponsibilitiesoftheCommitteearetoassisttheBoardinfulfillingitsoversightresponsibilitiesinrelationto:financial reporting; the effectiveness of the system ofriskmanagement and internal control; compliancewithrelevant legal and regulatory requirements;monitoringthequalifications,expertise,resourcesandindependenceofboththeinternalandexternalauditors;andassessingthe auditor’s performance and effectiveness. TheCommitteekeepstheBoardinformedoftheCommittee’sactivitiesandrecommendations.WheretheCommitteeisnot satisfiedwith, or wherever it considers action orimprovement is required concerning any aspect of riskmanagementand internalcontrol, financial reporting,oraudit-relatedactivities,itpromptlyreportstheseconcernstotheBoard.TheCommittee’ssignificantactivitieshavebeensummarizedbelow.

SIGNIFICANT ACTIVITIES

1. Financial Statements

TheCommittee has reviewed and discussedwith theexternal auditor and management responsible forpreparing the financial report in relationwith significantinformation for the Company’s quarterly and annualfinancial statements for the year 2014 as well asconsolidated financial statements of Thoresen Thai

AgenciesPublicCompanyLimitedand its subsidiaries,includingchangeinsignificantaccountingpolicy,significantrelated party transaction, significant acquisition anddisposaloftheCompany’sasset,accuracyandadequacyofinformationdisclosure,significantunusualandestimatedtransaction, if any, for thebenefit of investors or usersof such statements before submitted to the Board ofDirectors for approval. Themanagement is responsiblefor thepreparationand fairpresentationof the financialstatements alongwith the necessary internal controlover these,while the external auditors are responsibleforexpressinganopiniononthefinancialstatements.

Inaddition,theCommitteeheldmeetingswiththeexternalauditors without the presence of the Company’smanagement so as to freely discuss important issueswhichmay arise including the problems or difficultiesinperformingtheirduties.TheCommitteeisoftheopinionthattheCompanyhasaproperfinancialreportingprocesstodiscloseitsfinancialinformation,inwhichthefinancialstatements were free from material misstatementandpreparedinaccordancewithThaiFinancialReportingStandards.

In addition, the Internal Auditors have reviewed theconnected transaction or transaction thatmay lead toconflicts of interests ensuring that the transactionoccurredhascompliedwiththeSecuritiesandExchangeCommission and the Stock Exchange of Thailand

AUdIT COmmITTEE REPORT


regulations requirements, other regulatory bodies andarereasonableandforthehighestbenefitoftheCompany.The result of the review has been reported to theCommitteeandsubsequentlytheBoardofDirectors.TheCommitteeisoftheopinionthattheaforesaidtransactionsare reasonable, fair, without conflict of interest, in allmaterialrespects,transparencyandforthehighestbene-fitoftheCompany.

2. Internal Controls

TheCommittee has determined the independence ofInternalAuditDepartmentincludingthechainofcommandinordertoestablishthecredibilityandindependenceofInternal AuditDepartment aswell as all internal auditactivities and consulting activities were performedeffectively, efficiently andcarriedout inamannermostbeneficial to the Company and its shareholders byreviewing the scope of internal audit ing, theirresponsibilities and functions, and approved therevised internal audit charter and annual audit plan,which based on the Company’s key risk areas andemphasized on the evaluation of the effectiveness ofkeycontrolpointsforeachprocess.

Director, Internal Audit, Ms. Runpavee Daengnoywas appointed in September 2012 after deliberatelyconsiderationofallqualifiedcandidates.TheCommitteehas concluded thatMs. Runpavee has high degreeofexpertknowledgeandprofessionalexperiencerequiredfor thepurposedofconductingtheCompany’sDirector,InternalAudit. She has been providing theCommitteewith her view on the effectiveness and efficiency ofinternalauditactivitiesbyfocusingonhigh-riskauditableentities and also on various consulting activities. TheCommittee evaluated her performancewith PresidentandChiefExecutiveOfficer and concluded that itwasexceptionalandabletofulfillherroleinaccordancewiththeCharter.

TheCommitteehasreviewedtheadequacyandsuitabilityoftheinternalcontrolsystemassessmentthattheInternalAuditDepartmentreportedtotheCommittee,includingtheresults of audit on the operational processes of keybusinesses of theCompany and core subsidiaries. Inaddition, theCommitteeevaluatedmanagementcontrolsystems, financial control systems and compliancecontrolsystems,basedonguidelinesfromtheofficeoftheSecuritiesandExchangeCommission. Internalauditorshave also followed up on the results of the aforesaidreviewandauditwhich the resultsof theaudit and therecommendationswerediscussedwith the related staffandmanagementprior to report to theCommittee.Theresultshaveshownthatthesystemsandprocessesareappropriate to theCompany’s operations. Theexternalauditor has also reported that was no significantdeficiencyimpactingtotheCompany’sfinancialstatementsidentified.TheCommittee,therefore,isoftheopinionthattheCompanyhasproper andadequate internal control

systemsincludingorganizationalcontrolandenvironmentmeasure,riskmanagementmeasure,managementcontrolactivities, information and communicationmeasure,andmonitoring systems, asmanagement determinesis necessary and there are no significant deficienciesidentifiedwhetherduetofraudorerror.

3. Regulatory Compliance

TheCommitteeheldquarterlymeetingwiththeComplianceDepartment to review theCompany’s compliancewiththelawonsecuritiesandexchange,theStockExchangeof Thailand’s regulation, and the laws pertaining tothe Company’s business operations. In addition, theexternal auditor did not report any suspiciouscircumstances inwhich a director, executive or otherperson responsible for the Company’s operationsmightbesuspectedofcommittinganoffenseunderSection89/25of theSecuritiesandExchangeActduring2014.The Committee is of the opinion that the Companyhas been in compliance with significant laws andregulationstowhichtheoperationsoftheCompanyaresubjected.

4. Whistleblowing

TheCommitteeacknowledgedallconcernsofmisconductor fraud and reviewed the final investigation report byInternal Auditors according toWhistleblower Policy.Nofraudulentcasewasfoundin2014.

5. Appointment of the External Auditor

TheCommitteetookintoconsiderationthenominationandappointment of the external auditor and the audit feesfor three-monthperiodended31December 2014.Thisprocess entailed assessment of the current externalauditor for its independence, performance for the year2014, knowledge, competency, andexperience in corebusinesses,availableteamsupportandcompetitivenessof the audit fees. After careful consideration, theCommitteeconcludedthatKPMGPhoomchaiAuditLtd.,external auditors, acted independently, demonstrateda high degree of expert knowledge and professionalexperience required for the purposed of conductingtheCompany’sexternalaudit,performedwithsatisfactoryresultandwithacompetitiveauditfees.

TheCommittee has recommendedKPMGPhoomchaiAudit Ltd. as external auditor to theBoardofDirectorsbeforeseekingapprovalattheShareholders’Meetingforthe appointment ofMrs. SiripenSukcharoenyingyong,CertifiedPublicAccountantRegistrationNo.3636;and/orMr.CharoenPhosamritlert,CertifiedPublicAccountantRegistrationNo.4068;and/orMr.VeerachaiRatanajratkul,CertifiedPublicAccountantRegistrationNo.4323;and/orMs. Pornthip Rimdusit, Certified Public AccountantRegistrationNo.5565;allofKPMGPhoomchaiAuditLtd.,as theexternalauditorof theCompany for three-month



periodended31December2014withtheaudit feesforTTAlevelandtheGrouplevelamountBaht0.95millionandBaht6.0million,respectively.

6. The Audit Committee Self-Assessments

The Committee carried out its own performanceassessment, against the Audit Committee Charterapprovedby theBoard ofDirectors, relevant lawsandregulationsandassignmentfromtheBoardofDirectors.Theself-assessmentwasduetobebenchmarkedagainstguidelinesfromtheSecuritiesandExchangeCommissionandconcludedthatitwasexceptional,effectiveandabletofulfillitsroleinaccordancewithitsCharter.

Insummary,theCommitteehascontinuouslyperformedits duties and responsibilitieswith knowledge, ability,carefulness and sufficient independence, providedcommentsandrecommendationswhichwerebeneficialtoalloftheCompany’sstakeholdersandalsohasdeterminedthat the Board of Directors, andmanagement haveperformed their job professionally and in pursuit oftheCompany’s strategic goals,with adequate internalcontrol compatible with its business, together withreliableaccountingpracticeandfinancialstatements,andcompliance with significant and relevant laws andregulations.

ForandonbehalfoftheAuditCommitteeofThoresenThaiAgenciesPublicCompanyLimited

KrishFollettChairmanoftheAuditCommittee



boArd of dIreCTorsMr.MohammedRashedAhmadM.AlNasseri

Mr.KrishFollett

Mr.SantiBangor

Mr.ChiaWanHuatJoseph

Mr.ChalermchaiMahagitsiri

BOARd Of dIRECTORS


Mr. Prasert Bunsumpun

Ms. Ausana Mahagitsiri

Mr. Cherdpong Siriwit

Mr. Jean Paul Thevenin

Mr. Yves Barbieux

Board of directors


boArd of dIreCTors

Educations•HonoraryDoctoralofArtsinSocialInnovationManagement,FacultyofHumanities andSciences,SuanSunandhaRajabhatUniversity,2012•HonoraryDoctoralinManagement,MahasarakarmUniversity,2011•HonoraryDoctoralinManagementScience,PetchaburiRajabhatUniversity,2008•HonoraryDoctoralinManagement,NationalInstituteofDevelopmentAdministration (NIDA),2008•HonoraryDoctoralinEngineering,ChulalongkornUniversity,2007•M.B.A.,UtahStateUniversity,USA,1977•B.Eng.inCivilEngineering,ChulalongkornUniversity,1975

Trainings/Certifications•Certificate inEnergyLiteracy foraSustainableFutureProgram,ThailandEnergy Academy,Class3,2013•RoleoftheChairmanProgram(RCP),ThaiInstituteofDirectorsAssociation(IOD), Class28/2012•DirectorAccreditationProgram(DAP),ThaiInstituteofDirectorsAssociation(IOD), Class26/2004•CertificateinCapitalMarketAcademyLeadershipProgram,CapitalMarketAcademy, Class3,2006•Certificate inPoliticsandGovernance inDemocraticSystemforExecutives,King Prajadhipok’sInstitute,Class6,2003•Certificate inAdvancedManagementProgram (AMP),HarvardBusinessSchool, USA,Class155,1998•Diploma,NationalDefenceCoursefortheJointState-PrivateSector,theNational DefenceCollege(NDC),Class10,1998

Professional experiences2013–present : Director/Member of the Enterprise RiskManagement

Committee,PTTPublicCompanyLimited2012–present : Chairman/Chairman of Executive Committee,Mermaid

MaritimePublicCompanyLimited2011–present : Director/ChairmanoftheBoardofExecutiveDirectors,Krung

ThaiBankPublicCompanyLimited2011–present : Chairman,PTTGlobalChemicalPublicCompanyLimited2011–present : Director/Chairman of the Nomination andGovernance

Committee,IntouchHoldingsPublicCompanyLimited2014–present : MemberoftheNationalLegislativeAssembly,Thailand2014–present : First Vice –President of theCommittee onEnergy, the

NationalLegislativeAssembly,Thailand2011–present : Chairman, Thailand Business Council for Sustainable

Development(TBCSD)2007–2011 : Director, PTTAromatics andRefining Public Company

Limited2006–2013 : Chairman/Chairman of theExecutiveBoard ofDirectors/

Director,IRPCPublicCompanyLimited2005–2011 : Chairman/Director,PTTChemicalPublicCompanyLimited2003–2011 : Director/PresidentandChiefExecutiveOfficer,PTTPublic

CompanyLimited2000–2011 : Chairman/Director,PTTExplorationandProductionPublic

CompanyLimited2006–2008 : MemberoftheNationalLegislativeAssembly,Thailand

Relation among family with other directors and executives :None

Mr. Prasert Bunsumpun (Age 62)ChairmanoftheBoard/ChairmanofExecutiveCommittee

Date of first appointment :31January2012

(%) of shareholding as of 30 September 2014 :0.01

BOARd Of dIRECTORS


Educations•M.S.inFinance,BostonUniversity,USA,2004•B.S.inFinance,SuffolkUniversity,USA,2001

Trainings/Certifications•DirectorCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation(IOD), Class53/2005•DirectorAccreditationProgram(DAP),ThaiInstituteofDirectorsAssociation(IOD), Class30/2004•CapitalMarketAcademy LeadershipProgram,CapitalMarketAcademy (CMA), Class17,2013

Professional experiencesJun.2012–present : ChiefExecutiveOfficer/ExecutiveViceChairman,Mermaid

MaritimePublicCompanyLimitedJun.2012–present : ViceChairman,UniqueMiningServicesPublicCompany

LimitedJun.2013–present : Chairman,PMThoresenAsiaHoldingsPublicCompany

LimitedSep.2011–present : ViceChairman,Posco-ThainoxPublicCompanyLimitedApr.2011–present : ViceChairman,ThaiFilmIndustriesPublicCompanyLimitedAug.2014–present : Director,PremoShippingPublicCompanyLimitedApr.2014–present : Director,ThoresenShippingFZEMar.2014–present : Director,ChidlomMarineServices&SuppliesLimitedFeb.2014–present : Director,GulfAgencyCompany(Thailand)LimitedFeb.2014–present : Director,GACThoresenLogisticsLimitedJan.2014–present : Director,AtheneHoldingsLimitedJan.2014–present : Director,Thoresen&Company(Bangkok)LimitedJan.2014–present : Director,Fearnleys(Thailand)Limited2013–present : Director,ThoresenShippingSingaporePte.Ltd.Nov.2013–present : Director,BaconcoCompanyLimitedNov.2013–present : Director,Thoresen(Indochina)S.A.Jul.2012–present : Director,SoleadoHoldingsPte.Ltd.2013–present : Director,MermaidDrillingLimited2013–present : Director,AsiaOffshoreDrillingLimited2013–present : Director,MermaidOffshoreServicesPte.Ltd.Apr.2014–present : Director,MermaidMaritimeMauritiusLtd.Jan.2014–present : Director,MTR–4(Singapore)Pte.Ltd.Jan.2014–present : Director,MTR–5(Singapore)Pte.Ltd.2012–present : ChiefExecutiveOfficer,411ENTCo.,Ltd.2005–present : ChiefExecutiveOfficer,PMGroupCompanyLimited1998–present : ManagingDirector,LakewoodCountryClubCo.,Ltd.1998–present : Director,LakewoodLandCo.,Ltd.present : Director,QualityCoffeeProductsCo.,Ltd.

Relation among family with other directors and executives : Ms.AusanaMahagitsiri’sbrother

Educations•Ph.D.inMetallurgy,OrsayUniversity,France•HonoraryPh.D.,KingMongkutInstituteofTechnology,Thailand

Trainings/Certifications•DirectorAccreditationProgram(DAP),ThaiInstituteofDirectorsAssociation(IOD), Class74/2008

Professional experiencesJan.2013–present : Director,MermaidMaritimePublicCompanyLimited2005–2010 : ManagingDirector, Thainox Stainless Public Company

LimitedSep.2014–present : Director,MermaidDrillingLtd.Sep.2014–present : Director,MTR-1Ltd.Sep.2014–present : Director,MTR-2Ltd.1998–2004 : President,Franco–ThaiChamberofCommerce


Mr. Chalermchai Mahagitsiri (Age 36)PresidentandChiefExecutiveOfficer/MemberofExecutiveCommittee/MemberofRiskManagementCommittee


(%) of shareholding as of30 September 2014 :21.90(whichincludesrelatedcompany’sshareholding)

Mr. Jean Paul Thevenin (Age 74)Director/MemberofExecutiveCommittee

Date of first appointment : 30January2014

(%) of shareholding as of 30 September 2014 : Mr. Thevenin :NoneSpouse :0.0006Total :0.0006

BOARd Of dIRECTORS


Educations•Master’sDegree (EMBA),SasinGraduate InstituteofBusinessAdministrationof ChulalongkornUniversityinajointprogramwithKelloggGraduateofManagement

ofNorthwesternUniversity,USA

Trainings/Certifications•DirectorCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation(IOD), Class165/2012

Professional experiencesJun.2012–present : MemberofExecutiveCommittee,MermaidMaritimePublic

CompanyLimited

Jun.2012–present : MemberofExecutiveCommittee,UniqueMiningServices

PublicCompanyLimited

2013–present : Director,PMThoresenAsiaHoldingsPublicCompanyLimited

Aug.2014–present : Director,ThoresenShippingFZE

2013–present : Director,MermaidOffshoreServicesLimited

2013–present : Director,MermaidDrillingLimited

Jan.2012–present : SeniorExecutiveVicePresident,PMGroupCompanyLimited

2005–2011 : SeniorExecutiveVicePresident,StructuredFinanceGroup,

AdvanceFinancePlc.

2003–2004 : AssistantManagingDirector,SouthEastLifeInsuranceand

SouthEastGeneralInsuranceCompany

Relation among family with other directors and executives : None

Educations•M.B.A.inFinance,ThammasatUniversity,1988•B.A.inEconomics,ThammasatUniversity,1969

Trainings/Certifications•Diploma Examination (EXAM), Thai Institute of Directors Association (IOD), Class32/2012

•DirectorCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation(IOD), Class149/2011

•AdvanceManagementProgram,HarvardBusinessSchool,Boston,USA,2000

Professional experiences2013–present : IndependentDirector/MemberoftheAuditCommittee,Saha

PathanaInterHoldingPublicCompanyLimited

2012–present : IndependentDirector/Member of theRiskManagement

Committee,ThaiWacoalPublicCompanyLimited

2011–present : Independent Director/Member of the Audit Committee,

ThanuluxPublicCompanyLimited

2010–present : IndependentDirector/Chairman of theAuditCommittee,

PropertyPerfectPublicCompanyLimited

2010–present : HonoraryDirector,NakornPhanomUniversity

2009–2013 : Advisor to Chief ExecutiveOfficer, BoonrawdBrewery

CompanyLimited

2008–2009 : AssistantGovernor ofOperationsGroup, The Bank of

Thailand

2004–2008 : SeniorDirector, InternalAuditDepartment, TheBank of

Thailand

2002–2004 : Senior Officer of Financial Institution Oversight and

ExaminationDepartment,TheBankofThailand

1992–1995 : VicePresident,CapitalMarkets,EnforcementDepartment

oftheSecuritiesandExchangeCommission(SEC),Thailand


Mr. Chia Wan Huat Joseph (Age 55)Director/MemberofExecutiveCommittee/MemberofCorporateGovernanceCommittee


(%) of shareholding as of30 September 2014 : None

Mr. Krish Follett (Age 66)IndependentDirector/ChairmanofAuditCommittee/ChairmanofRiskManagementCommittee

Date of first appointment : 12April2012

(%) of shareholding : None

BOARd Of dIRECTORS


Educations•M.A.inAgriculturalEconomics,TexasTechUniversity,USA,1980•B.A.inPoliticalScience(Fiscal),ChulalongkornUniversity,1968

Trainings/Certifications•AuditCommitteeProgram (ACP), Thai Institute ofDirectorsAssociation (IOD),Class42/2013

•MonitoringFraudRiskManagement(MFM),ThaiInstituteofDirectorsAssociation(IOD),Class9/2013

•MonitoringtheSystemofInternalControlandRiskManagement(MIR),ThaiInstituteofDirectorsAssociation(IOD),Class14/2013

•MonitoringtheInternalAuditFunction(MIA),ThaiInstituteofDirectorsAssociation(IOD),Class14/2013

•Monitoring theQuality of FinancialReporting (MFR), Thai Institute ofDirectorsAssociation(IOD),Class17/2013

•Roleof theCompensationCommitteeProgram (RCC),Thai InstituteofDirectorsAssociation(IOD),Class16/2013

•DirectorCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation(IOD),Class12/2001,

•Diploma,NationalDefenceCollege(NDC),Class38,1995•DevelopmentCertificate,CambridgeUniversity,UK,1975

Professional experiences2013–present : IndependentDirector/ChairmanoftheCorporateGovernance

Committee,People’sGarmentPublicCompanyLimited2010–present : MemberoftheAuditCommittee,People’sGarmentPublic

CompanyLimited2012–present : MemberofStateEnterprisePerformanceAgreementand

PerformanceAppraisalSub-CommitteeonCommunicationandEnergy Sector, PerformanceAppraisal Committee,MinistryofFinance

2006–2009 : President,YonokUniversity(NationUniversity)1997–2006 : DeputySecretaryGeneral to theNationalEconomic and

SocialDevelopmentBoard,OfficeofthePrimeMinister2001–2002 : Director,MetropolitanElectricityAuthority1996–1999 : Director,GovernmentPensionBoard1999–2001 : Director,StateRailwayAuthority


Educations•M.B.A., SasinGraduate Institute of Business Administration of Chulalongkorn University in a joint programwithKelloggGraduateSchool ofManagement of NorthwesternUniversity,USA,2005•B.S.inBusinessAdministration,BostonUniversitySchoolofManagement,USA,2002

Trainings/Certifications•DirectorAccreditationProgram(DAP),ThaiInstituteofDirectorsAssociation(IOD),Class30/2004

Professional experiences2013–present : Director,ThaiFilmIndustriesPublicCompanyLimitedMar.2014–present : Director,ChidlomMarineServices&SuppliesLtd.Feb.2014–present : Director,GACThoresenLogisticsLtd.Jan.2014–present : Director,AtheneHoldingsLtd.Jan.2014–present : Director,SoleadoHoldingsPte.Ltd.Jan.2014–present : Director,ThoresenShippingSingaporePte.Ltd.2011–present : ChiefOperatingOfficer,PMGroupCo.,Ltd.2010–present : ManagingDirector,TheNestPropertyCo.,Ltd.2010–present : Director,QualityCoffeeProductsCo.,Ltd.2008–present : Director,411ENTCo.,Ltd.2006–present : ManagingDirector,MountainCreekDevelopmentCo.,Ltd.1998–present : Director,LakewoodCountryClubCo.,Ltd.1998–present : Director,LakewoodLandCo.,Ltd.

Relation among family with other directors and executives :Mr.ChalermchaiMahagitsiri’ssister

Mr. Santi Bangor (Age 68)IndependentDirector/ChairmanofNominationandRemunerationCommittee/ChairmanofCorporateGovernanceCommittee/MemberofAuditCommittee


(%) of shareholding as of 30 September 2014 :None

Ms. Ausana Mahagitsiri (Age 34)Director/MemberofNominationandRemunerationCommittee/MemberofCorporateGovernanceCommittee

Date of first appointment : 31January2012

(%) of shareholding as of 30 September 2014 : 3.91

BOARd Of dIRECTORS


Educations•LicenseofLaw,EmiratesUniversity

Trainings/Certifications•None

Professional experiencesPresent : MemberoftheNationalConsultingCouncil,UAE

Present : Assistant-UndersecretaryintheFinancialDepartmentofAbu

Dhabi,UAE

Present : DirectorGeneral of Pvt. &Official office ofH.HSheikh

MohammedBinKhalifaBinZayedAlNahyan,UAE

Present : VicePresidentofYouthHostelSociety,UAE

Present : Board’sMemberofTheEmiratesInsuranceCompany,UAE

Present : Board’sMemberofTheNationalInvestorCompany,UAE

Present : Board’sMemberofAlwifaqFinanceCompany,UAE

Present : GeneralManagerofAlAinEquestrian,Shooting&GolfClub,

UAE

Present : VicePresidentofGulfIslamicInvestmentCompany,UAE


Educations•M.B.A.,HarvardBusinessSchool,USA,1973•M.B.A.,Institutd’AdministrationdesEntreprisesdeParis,France,1967•Bachelor’sDegree,CivilEngineer,EcoleCentraledeParis,France,1961

Trainings/Certifications•None

Professional experiencesPresent : ChairmanoftheExecutiveBoard,VoluntisS.A.,France

Present : MemberoftheExecutiveBoard,Claranor,France

Present : MemberoftheExecutiveBoard,Lucibel,France

2003–present : ExecutiveChairman,ElsaConsultantS.A.

2000–2004 : ExecutiveChairman,CPGMarketS.A.

1996–2000 : ChairmanandChiefExecutiveOfficer,NESTLEITALY

1993–1996 : ChairmanandChiefExecutiveOfficer,NESTLEFRANCE

1989–1992 : ChairmanandChiefExecutiveOfficer,SOPADNESTLE,

France

1988–1989 : ChairmanandChiefExecutiveOfficer,NESTLETHAILAND

1978–1981 : ChairmanandChiefExecutiveOfficer,NESTLEBELGIUM

1976–1978 : ChiefExecutiveOfficer,NESTLEVENEZUELA

Relation among family with other directors and executives: None

Mohammed Bin Rashed Bin Ahmad Bin Muftah Al Nasseri (Age 44)IndependentDirector/MemberofNominationandRemunerationCommittee



Mr. Yves Barbieux (Age 76)Director

Date of first appointment : 12July2013


BOARd Of dIRECTORS


Educations•M.A.Economics,GeorgetownUniversity,USA•B.A.Economics(Honor),ThammasatUniversity

Trainings/Certifications•AuditCommitteeProgram(ACP),ThaiInstituteofDirectorsAssociation(IOD),Class27/2009

•DirectorsCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation(IOD),Class104/2008

•FinanceofNon-FinanceDirectors(FND),ThaiInstituteofDirectorsAssociation(IOD),Class13/2004

•RoleofChairmanProgram(RCP),ThaiInstituteofDirectorsAssociation(IOD),Class10/2004

•DirectorAccreditationProgram(DAP),ThaiInstituteofDirectorsAssociation(IOD),Class8/2004

•Diploma,TheJointState-PrivateSectorCourse,NationalDefenseCollege,Class40•AdvancedCertificateCourseinPoliticsandGovernanceinDemocraticSystemforExecutives,KingPrajadhipok’sInstitute,Class5

•TheCivil ServiceExecutiveDevelopmentProgram I, TheCivil ServiceTrainingInstitute,Class13/1993

•CapitalMarketAcademy LeadershipProgram,CapitalMarketAcademy (CMA),Class5

Professional experiencesMay2009–present : IndependentDirector,IRPCPublicCompanyLimited

Apr.2009–present : ChairmanofAuditCommittee,IRPCPublicCompanyLimited

2010–present : Chairman,SolartronPublicCompanyLimited

2009–present : ChairmanandAuditCommittee,AdvanceFinancePublic

CompanyLimited

2012–present : Chairman,ThaiSugarMillersCorporationLimited

2011–present : Chairman,VithaiBiopowerCompanyLimited

2009–present : Director,EvergreenPlusCompanyLimited

Nov.2011–Oct.2014 : Chairman of CorporateGovernanceCommittee, IRPC

PublicCompanyLimited

2006–2009 : Independent Director/ Audit Committee/ Remuneration

Director,PTTChemicalPublicCompanyLimited

2004–2008 : Chairman,PTTExplorationandProductionPublicCompany

Limited

2005–2007 : Chairman,RayongRefineryPublicCompanyLimited

2004–2008 : Chairman,ThaiOilPublicCompanyLimited

2003–2007 : Chairman,PTTPublicCompanyLimited

2003–2007 : Chairman,RatchaburiElectricityGeneratingHoldingPublic

CompanyLimited

2003–2004 : Chairman,ElectricityGeneratingAuthorityofThailand(EGAT)

2002–2006 : PermanentSecretary,MinistryofEnergy


Mr. Cherdpong Siriwit(Age 68)IndependentDirector/MemberofAuditCommittee



BOARd Of dIRECTORS


exeCuTIveoffICers

Mr. Krailuck Asawachatroj(Age 42)

Educations

•MasterofArtsinFinancialEngineering,NewYorkUniversity,USA,2001

•MasterofBusinessAdministrationinFinance,ClaremontGraduateUniversity,

USA,1997

•BachelorofEngineeringinIndustrialEngineering,ThammasatUniversity,1994

Trainings/Certifications

•DirectorCertificationProgram(DCP),ThaiInstituteofDirectorsAssociation

(IOD),Class187/2014

Professional experiences

Jan.2014–present : Director,PMThoresenAsiaHoldingsPublicCompany

Limited

Aug.2014–present : Director,PremoShippingPublicCompanyLimited

Sep.2014–present : Director,Thoresen(Indochina)S.A.

Jan.2014–present : Director,AtheneHoldingsLimited

Nov.2013–present : Director,Petroliftinc.

Nov.2013–present : Director,BaconcoCompanyLimited

Oct.2013–present : Director,Thoresen&Company(Bangkok)Limited

Oct.2013–present : Director,Fearnleys(Thailand)Limited

Oct.2013–present : Director,GACThoresenLogisticsLimited

Oct.2013–present : Director,ThoresenShippingandLogisticsCompany

Limited

Aug.2011–Jul.2013 : ExecutiveVicePresident/ChiefFinancialOfficer,

TheErawanGroupPublicCompanyLimited(Thailand)

2001–2011 : SeniorVicePresident,CorporateAdvisory,

TheSiamCommercialBankPublicCompanyLimited


Mr. Chalermchai Mahagitsiri (Age 36)

His biography appears in the section “Board of Directors”

Executive Vice President, Corporate Finance and Accounting

Date of appointment : 1January2014(%) of shareholding as of 30 September 2014 :None

President and Chief Executive Officer

Date of appointment : 1January2014(%) of shareholding as of 30 September 2014 : 21.90(whichincludesrelatedcompany’sshareholding)

ExECUTIVE OffICERS


Mr. Somporn Chitphentom(Age 53)

Ms. Urai Pluemsomran(Age 60)

Educations

•MasterinPublicPolicies,HarvardUniversity,Cambridge,USA,1987

•BachelorofScienceinBusinessAdministration,BostonUniversity,USA,1985



(IOD),Class178/2013,

•FinanceManagement Program,Ministry of Finance and Fiscal Policy

Institute,Class3,2012

•CorporateGovernanceProgram forDirector andSeniorManagement of

StateEnterprisesandPublicOrganizations,KingPrajadhipok’sInstitute,2011

•SeniorAdministratorsOrganizationSAP-1,2005

•TheAsiaPacificBankersCongress,2000

•CentralBankPoliciesandOperationsintheMoneyandForeignExchange

Markets,1991


Jul.2014–present : ActingChiefExecutiveOfficer andExecutiveVice

President,FinanceandAccounting,UniqueMining

ServicesPlc.

Nov.2013–present : Director,UniqueMiningServicesPlc.

Sep.2014–present : Director,PremoShippingPlc.

Jun.2014–present : Director,ThoresenShippingFZE

Jun.2014–present Director,SoleadoHoldingsPte.Ltd.

Dec.2013–present : Director,ThaiFilmIndustriesPlc.

Nov.2013–present : Director,PetroliftInc.

May2013–present : Director,PMGroupCompanyLimited

Apr.2013–Sep.2013: SeniorExecutiveVicePresident,PMGroupCo.,Ltd.

Dec.2009–Apr.2013: Senior Executive Vice President, Export-Import

BankofThailand

Feb.2004–Nov.2009: Executive Vice President, Export-Import Bank of

Thailand

1993–Jan.2004 : SeniorVicePresident,Export-ImportBankofThailand

1987–1993 : Analyst,AnalysisandMonetaryOperationsDivision,

BankofThailand


Educations

•Bachelor’sDegree inManagementandAccounting,WoodburyUniversity,

USA,1975


•DiplomaExamination(EXAM),ThaiInstituteofDirectorsAssociation(IOD),

Class41/2014


(IOD),Class176/2013

•CertifiedSixSigmaBlackBelt,2008

•MBAProgram,InternationalSchoolofManagement,ChulalongkornUniversity,

1997


2007–2010 : ManagingDirector, TheDowChemical Indonesia

Company-Indonesia

2004–2007 : Finance Director, The DowChemical Indonesia

Company-Indonesia

2000–2004 : CorporateAuditProcessManager,TheDowChemical

Company-USA

1992–2000 : Country Controller, TheDowChemical Thailand

Company and SCC-DowGroup of joint Venture

Companies


Executive Vice President, Corporate Strategy

Date of appointment :1October2013(%) of shareholding as of 30 September 2014 :None

Executive Vice President, Corporate Risk Management and Compliance

Date of appointment : 12July2010(%) of shareholding as of 30 September 2014 :0.012

ExECUTIVE OffICERS



CorporATe seCTIonT h o r e s e n T h A I A G e n C I e s p l C . ( T T A )

T H O R E S E N T H A I A G E N C I E S P L C028 Business review & outlook

COMPANY BACKGROUND

ThoresenThaiAgenciesPublicCompanyLimited(“TTA”or the “Company”) is a strategic investment holdingcompany, currently amember of theStockExchangeof Thailand - SET 100with a portfolio of businessesacross three primary groups - Transport, Energy, andInfrastructure.TTA has grown significantly from ashipping-related services company found by theNorwegianin1904toadiversifiedgroupofcompaniesandsubsidiariesthatoperateinternationally.

TTAbegantoprovidedry-bulkshippingservicesin1985.Ten years later the Company floated on the StockExchange of Thailand and expanded the scope of itsbusiness to offshore oil and gas services viaMermaidMaritimesPlc(“Mermaid”)acquisition.MermaidwasthenalsosuccessfullylistedontheSingaporeStockExchange(“theSGX”)in2007, raisingSGD246milliontofacilitatefurthergrowth.

Inorder toprovideshareholderswithadditionalgrowth,andmore importantly tomoderate thecyclicalnatureoftwooftheGroup’slargestbusinesses,TTAnextsoughttodiversify and shift its focus to becoming a diversifiedinvestmentholdingcompany.Sincethennumeroussoundinvestments have beenmade to soften the impact ofindustrydowncyclesexperiencedbycertainbusinesses.

Investments forming part of the business expansionincluded the formation of TTA’s infrastructure businessthroughtheacquisitionofalargestakeinUniqueMiningServicesPublicCompany Limited (“UMS”) andMertonGroup (Cyprus)Ltd. (withoperations in thePhilippines,coallogisticscompanies,aswellasQingMeiPte.Ltd.todevelopanewcoal-miningprojectinIndonesia.

The infrastructure businesswas strengthenedwith theacquisition of BaconcoCo., Ltd., a fertilizer companyinVietnam.Later,BariaSerecewasacquiredaspartofa strategy to create an integrated logistics business inVietnam.

In 2011, the businesswent through some fundamentalchanges,layingthefoundationsandbuildingaplatformforgrowth.Achangeintheshareholdingstructurewasledby

theMahagitsiri family who foresaw an opportunity toturnaroundTTA’sbusinessafterithadbeenfacingsomechallenges,andbecameamajorshareholderofTTA.Buildinguponthis,additionalfundingwasraisedin2013,througha rights issuewhich raisedTHB3,965million,pavingthewayfortherenewalofitsdrybulkandoffshoredrilling fleets. Following this,Mermaid raised a furtherSGD 176million through a rights issue and privateplacement,inordertoacceleratetherenewalofitsdrillingfleet.

In order to continue the fleet renewal and deliver theefficiencies required in the shipping business and tofacilitatefurtherstrategicinvestmentsintheTTAinvestmentgroupportfolio, a furtherTHB 4,174millionwas raisedin2014.

Most recently, in late 2014, TTAentered the food andbeveragesectorthroughtheacquisitionofa9%stakeinSinoGrandness Food IndustryGroup Limited (“SinoGrandness”),aChinesecompanylistedontheSGX.

These strategicmoves and investments have helpedTTA successfully evolve into a strategic investmentholding company with a diverse geographical andindustrialfootprint.

BUSINESS OVERVIEW

As a strategic investment holding company, TTA’seconomicand financialperformanceultimatelydependson its ability to prudently and efficientlymanage itsinvestments and businesses through different industrycycles,usingaconservativefinancialapproach.

TTA’s Investment Strategy

TTAintendstoachievebalancedandconsistentgrowthofourexistinginvestmentportfoliointhreebusinessgroups,whichareallcapital-intensivesectorsincludingtransport,energy, and infrastructure, by seeking and evaluatingstrategic opportunities thatmeet or exceed its targetedlong-termreturnsoncapital.

CorporATe seCTIonThoresen ThAI AGenCIes plC. (TTA)

ANNUAL REPORT 2014 029Business review & outlook

As a strategic investment holding company, TTA iscontinuallylookingforlong-terminvestmentopportunitiesin any companies with capable managers, strongcash flows, prominent positions in their industries, andarobusttrackrecordandpotential forgrowthtohaveagoodmixofassets toensuresustainableprofitability toyieldgoodreturntoshareholders.

Key Developments

2011-2013:LayingTheFoundationsIn late 2011, theMahagitsiri family became amajorshareholder of TTAwith the intention of turning theenterprisearoundfromadifficultperiod. Thefollowingyear,in2012,thecompanyunderwentafundamentalshiftandrestructuring that strengthened control and brought arenewed focus on creating shareholder value – itwasa year of restructuring and transition. At the sametime,2012presentedindustrydowncyclesinthedrybulkbusinesswiththelowestglobalfreightrateenvironmentin25years.InlightofthisandtheGroup’scommitmenttofinancial transparency,TTAconducteda reassessmentandannouncedanumberofimpairmentsandwrite-downsto reflect a realistic viewof the fair value of its assetsinrelationtoitsshippingfleetandthevalueofgoodsinUMS.TTAalsorestructureditsdrybulkshippingbusiness,transferring all dry bulk vessels to ThoresenShippingSingaporePtd.Ltd.inordertobenefitfromtaxefficienciesandimprovedmanagement.

2013wasa year of contrast. Challenges continued topresent themselves and theCompanywas forced totake further significant impairments and extraordinarywrite-downsdue to theongoingunfavourableeconomicenvironment and operating issues in certain business.Incontrast,however,thereweresignificantachievements.Majornewcontractsweresecuredintheoil&gasservicessectorwhichcontributedverysignificantlytonetincome.TheCompanyalsostrengtheneditsfinancingcapabilitiesthroughacapital increase,enabling further investmentsin both the dry bulk shipping and off-shore servicesbusinesses.Inaddition,beyondtheoperatingperformanceimprovements,theCompanyalsoannouncedleadershipsuccession plan with a smooth transition, avoidingunnecessaryinterruptiontothebusiness.

2014:ACompanyReborn

The2014financialyearsawtheemergenceofarevitalizedCompany.Thesignificantstrategicinitiativesundertakenin2014,haveputTTAonanewplatformandhavesetanewtrajectoryforfuturegrowth.

A management team with a new set of priorities

TheyearbeganwiththeappointmentofMr.ChalermchaiMahagitsiri as theCompany’s newPresident &CEOandMr.KrailuckAsawachatrojasthenewCFO.Thenewmanagement team has sought to reinforce TTA’sstrong business fundamentals with prudent financialmanagement, a refreshed visionandmission to inspireand unify the teams across all of the businesses andrevitalizedstrategies.Whilecontinuingtoseektostrengthenandbuild upon thenet profit drivers, namelyThoresenShipping,MermaidandBaconco,thenewteamhasalsodemonstratedacleargoaloffurtherdiversification.

Financial strength

2014wasayearofpositivefinancialperformanceforTTA,with improvements across the entire portfolio, with anumberofbusinessesdeliveringrecordlevelsofgrowthandprofitability.Thecompanyannounceda2014financialyear profit of THB1,015million. This represented thecompany’sbestresultsince2009.

TheCompanyalsosuccessfullyraisedTHB4,174millionfromarightissueaspartofitscapitalincreaseplan.Theoversubscribedofferingpavedthewayfor fleetrenewalinvestmentsinthedrybulkandoffshoredrillingbusinesses.

New vision and mission

Withsomuchchangeandtherapidpaceatwhichprogressis beingmade, having a clear direction is crucial. Themanagementteamspenttimein2014toredefineTTA’svision,mission, and values to reflect theemergenceofwhatcanbeconsideredanew,revitalizedcompany.ThesecoreDNAcomponentsarewell-alignedwithTTA’sfive-yearroadmap.

Revitalized strategies

ORGANIC

Transport

ThoresenShippingexpandeditscapacitytomorethan1.2million deadweight tonnes, acquiring six second handSupramaxdry bulk vessels. TheCompanyalso furtherexpanded its global network through the opening of anew office in Cape Town, following the launch of itsfirstEurope-basedoffice in2013, inCopenhagen. Thelarger fleet and geographical footprint strengthens theCompany’sabilitytomeettheneedsofitsgrowingcustomerbase.

ThoresenShipping’s strategyofacquiring secondhandvesselsratherthannewonesfallsinlinewiththeGroup’shoned focus on delivering shareholder value, as theyare immediately operational and revenue generating.


Furthertothis,aspartoftheCompany’songoingdriveforefficiency,TTAannouncedtheamalgamationof45dormantshippingcompaniesreducingunnecessaryadministrativeexpensesandassociatedcosts,aswellasimprovingfundmobilization.

Energy

Aspartofitscommitmenttoenhancingitsoffshoreoilandgassupportservicescapabilitiesandcapacity,Mermaidmadeinvestmentstoexpandthesizeofitsfleetofrigsandvessels.Thecompanyenteredintoagreementstobuildtwo new tender rigs and one newdive support vesselwithChinaMerchantsIndustryHoldingsCo.,Ltd.foranaggregatesumofUSD436million.Deliveryof thenewtenderrigsisexpectedinthefirstandsecondquarterof2016respectivelywhilethedeliveryofthenewbuildDSVwillbeinthethirdquarterof2016.

Infrastructure

TheCompany’s announcement regarding plans to listPMThoresenAsiaHoldingsPlc.(“PMTA”)ontheStockExchange of Thailand reflects the increasingmarketvalueBaconcohasbeenbuildingandtheneedtofacilitateanacceleration ingrowth throughaccess toastrategicfinancialplatform.

INORGANIC

New strategic sector expansion

OneofthemostimportantannouncementsoftheyearwasTTA’s decision to enterChina’s fast-growing food andbeverage sector by announcing a strategic investmenttoacquire9%ofSinoGrandnessFood IndustryGroupLimited,aSingapore-listedcannedfoodandfruitbeverageproduceranddistributor inChina. Although thedeal issubject to approval by the regulator, upon completion,TTAwill become the second largest shareholderwithoneseatonSinoGrandness’Board.

TheinvestmentiswellalignedwiththeCompany’sstrategytoseekdiverseandhigh-potentialgrowthopportunitiesinhealthyandprofitablebusinesses. ItalsoaddsanotherbusinessenginetotheGroup’sexistingportfolioofdrybulkshipping,energy,andinfrastructurebusinesses.

Momentum for 2015 and beyond

Thefoundationsputinplacein2012and2013,alongwiththeinvestmentsandmomentumthathasbeengeneratedin2014havetrulysetTTAonthetrajectoryitneedstobeon to reach theCompany’sgoalofbecominga leadinginvestmentgroupinAsiaby2020.Themanagementteamwill continue to build upon the achievementsmade sofar andwill remain focused on striving for improvedperformanceandenhancingshareholdervalue.

BUSINESS OPERATIONS

TTA Investment Portfolio

TTA’s economic and financial performance ultimatelydependsonitsabilitytoprudentlyandefficientlymanageits diversified investment portfolio. Our investmentportfolio at theendofSeptember 2014 comprisedof 3primarybusinessgroupsasfollows:

GROUP TRANSPORT

Thoresen Shipping Singapore Pte. Ltd. (100%) Drybulk shipping services

GROUP ENERGY

Mermaid Maritime Plc. (57.42%) Subsea engineering and offshore drilling services

GROUP INFRASTRUCTURE

Baconco Co. Ltd. (100%) Fertilizer producer & warehouse services in Vietnam

Unique Mining Services Plc. (88.68%) Coal logistic services in Thailand

Fourmajor subsidiaries in TopTier generated around98.95%ofgrouprevenuesand106.59%ofgroupEBITDAin 2014. These four companies comprise of ThoresenShipping Singapore Pte. Ltd. (“Thoresen Shipping”),MermaidMaritimePlc (“Mermaid”), BaconcoCo., Ltd.(“Baconco”)andUniqueMiningservicesPlc.(“UMS”).

A key component in theGroup’s growth strategy is tostrengthenitsexistingportfolio.TTA’smanagementteamwillfocusonnurturingandsupportingthegrowthofitskeysubsidiariesbyensuringthattheyhaveanoptimalcapitalstructure,andtheyhaveadequatefinancialliquidityandareinastrongpositiontoservicedebt.

As theGroup seeks to further expand its geographicalfootprint,AsiaandtheMiddleEastarekeyfocusregionsfor new investment opportunities. Companies that areconsideredforinvestmentmustmeetthestringentcriteriaTTA’smanagementhasdefined,includingtheneedforacapablemanagement teamwith a proven track record,strong cash flows, prominent industry positions, andsignificantpotentialforgrowth.

The effective implementation of these strategies willenableTTAtoreachitslongtermgoalwhichistogrowitsmarket capitalization to THB 50 billion and become amemberoftheSET50bytheendof2016.


Competitive Strengths of the Group

TheCompany’sabilitytogrowthesediversifiedinvestmentstosufficientscalewhilesensiblymanagingtheCompany’slargercorebusinesshingesonthefollowingcompetitivestrengths:

Global business network: TTA, through its variousbusinessgroups,hasaglobalpresenceinmorethan20countries.ThroughThoresenShipping,ithasdevelopedstrongtieswithmanyinternationalports,wheretheGroupenjoys priority privileges to conduct its business. Theshipping Company’s newest commercial offices inCopenhagenandJohannesburgfacilitategreateraccesstoNorthAtlantic charterswith aUSoffice expected tofurther boost access to higher yielding dry bulk tradingroutes. ThroughMermaid, TTA has a presence in theMiddleEast andEurope, andenjoys relationshipswithmanyoftheworld’s largestandmostactiveoilandgascompanies.

Strong financial position: 2014wasastrongyear forTTAbothatthetopandbottomlines.TheGroupdeliveredpositivenormalizednetprofitofTHB1,028million.Strongperformance from Thoresen Shipping andMermaid,deliverednetcashflowofTHB2,583millionfromoperatingactivities during the year, a 126% improvement overthe previous year. As of 30 September 2014, TTA’sconsolidated cashand cashequivalents balance stoodatoverTHB6,290million.

Financial flexibility following successful fundraising:Capital raised in 2013 and 2014were partially usedtoaccelerate the fleetexpansionofThoresenShipping,addingsixnewvesselsduring thisyear. Inaddition,oilandgasservicessubsidiaryMermaidemployedadditionalfundsincommissioningtheconstructionoftwonewtenderrigs and one new dive support vessel, worth morethan THB 14 billion (USD 436million), as part of themanagementteam’scommitmenttoexpandingthesizeoftheCompany’sfleetofrigsandvesselsandtoenhancingoveralloffshoreservices.

Diversification strategy underway:2014sawTTAmakea strategic investment in SinoGrandness as part oftheGroup’s overarching diversification strategy. TheinvestmentwillprovideexposuretotheChinamarket,andto a new industry sector (food and beverages). TTAalsoseespotentialforSinoGrandnesstoleverageTTA’sglobalinfrastructureandexperiencetoextenditsbusinesstoothermarketsbeyondChina.

Strong knowledge of key commodities flows and trades:Withwell-establishedglobaldrybulk,coal,offshoreoilandgas,andfertilizerbusinesses,TTA’snetworkaffordsitauniquevantagepointfromwhichitcanobserveandactuponkeytrendsintheglobalcommoditiestrade.

Versatile and high quality owned fleet and services: TheGroupownsmostofitsassets,enablingittoprovideafullrangeofcustomizedservicestoitsclients.Fromthis,it canmaintainbetter control of its operating costs andprovidecompetitivemarketpricing,resultinginstrongbrandrecognitionandlong-termclientrelationships.Commercial,technicalandfinancialriskmanagementremainin-house,andGroup policy dictates that allmarine assets aremaintained in a condition that exceeds theminimumrequirementsimposedbyclassificationsocieties.

These competitive strengths, and the increasingmomentum that has been built over the last year,positionTTAwell for further stablegrowth in 2015andbeyond. TheCompany continues to deliver balancedand consistent growth across its existing portfolio, andexpectstoaccelerategrowthand increaseperformanceconsistency through further diversif ication. Themanagement team continues to identify and securestrategicopportunitiesthatgeneratelong-termreturnsoncapital.

FourkeystrategieslieattheheartofTTA’sgrowthstrategycomprising of further diversification, delivering strongand stable financial performance, prudent financialmanagementandbuildingsolidstakeholderrelationships.ThesekeystrategieswillbeappliedthroughouttheGroup’sinvestmentportfolio.


PremoShippingPlc.

ThoresenShippingSingaporePte.Ltd.

ThorFortuneShippingPte.Ltd.

ThoresenShippingDenmarkAPS

ThorFriendshipShippingPte.Ltd.

ThoresenShippingSouthAfrica(P

TY)Ltd.

ThorHorizonShippingPte.Ltd.

Thoresen&Com

pany(Bangkok)Ltd.

ThoresenShippingandLogistics

(Myanm

ar)Com

panyLimited

Thoresen-Vinam

aAgenciesCo.,Ltd.

Thoresen-Vinam

aLogisticsCo.,Ltd.

FearnleysShipbrokingPrivateLimited

ThoresenChartering(HK)Ltd.

ThoresenShippingGermanyGmbH

ThoresenChartering(Pte)Ltd.

ThoresenShippingFZE

ThoresenShippingandLogisticsLtd.

GulfA

gencyCom

pany(Thailand)Ltd.

Thoresen(Indochina)S.A.

Fearnleys(Thailand)Ltd.

PetroliftInc.

QingMeiPte.Ltd.(

3,5)

MertonGroup(Cyprus)Ltd.(5)

So

lead

o H

old

ing

s P

te. L

td.

MermaidMaritimePlc.(2)

MTR-1Ltd.

MTR-2Ltd.

MermaidDrilling(Malaysia)Sdn.B

hd.

MTR-1(Singapore)PteLtd.

MTR-2(Singapore)PteLtd.

MermaidInternationalVentures

PTSeascapeSurveysIndonesia

AsiaOffshoreDrillingLimited

MermaidSubseaServices(International)Ltd.

AsiaOffshoreRig3Limited

MermaidSubseaServicesLLC


SubseaSaudiArabiaLtd.


MermaidOffshoreServicesPte.Ltd.

SeascapeSurveysPte.Ltd.

SeascapeSurveys(Thailand)Ltd.

SKIE

nergyResourcesInc.

MermaidSubseaServices(Thailand)Ltd.

MermaidDrillingLtd.

MermaidDrilling(Singapore)Ptd.Ltd.

MTR-3(Singapore)Pte.Ltd.



MermaidMaritimeMauritiusLtd.

MertonInvestmentsNLBV

Zam

ilMermaidOffshoreServicesCom

panyLLC

UMSDistributionCo.,Ltd.

UMSLighterCo.,Ltd.

UMSPelletE

nergyCo.,Ltd.

UMSPortS

ervicesCo.,Ltd.

SharjahPortsServicesLLC

UniqueMiningServicesPlc.(

1)

BaconcoCo.,Ltd.(4)

BariaSerece

Chidlom

MarineServices&SuppliesLtd.

ThoresenShippingFZE

GACThoresenLogisticsLtd.

Ath

ene

Ho

ldin

gs

Ltd

.

GR

OU

P T

RA

NS

PO

RT

GR

OU

P E

NE

RG

Y

Th

ore

sen

Th

ai A

gen

cies

Plc

.

PM

Th

ore

sen

Asi

a H

old

ing

s P

lc.

GR

OU

P IN

FR

AS

TR

UC

TU

RE

57.4%

95%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

49%

95%

100%

33.8%

100%

100%

100%

100%

100%

49%

100%

40%

33.3%

13.7%

37.5%

100%

100%

100%

100%

88.7%

99.9%

99.9%

99.9%

99.9%

99.9%

51%

49%

100%

100%

100%

20%

40%

99.9%

49%

100%

49%

50%

51%

49%

70%

100%

100%

99.9%

100%

100%

100%

100%

100%

100%

100%

99.9%

99.9%

No

te:

(1)

Ath

ene

Hol

ding

s Lt

d. h

olds

a 8

8.68

% s

take

in U

niqu

e M

inin

g S

ervi

ces

Plc

.

(2

) T

TA

dire

ctly

hol

ds a

49.

54%

in

Mer

mai

d M

ariti

me

Plc

. an

d ho

lds

an i

ndire

ct s

take

thr

ough

S

olea

do H

oldi

ngs

Pte

. Lt

d. a

nd A

then

e H

oldi

ngs

Ltd.

of

whi

ch i

t ho

lds

6.44

% a

nd 1

.44%

re

spec

tivel

y.

(3

) E

ach

of S

olea

do H

oldi

ngs

Pte

. Lt

d. a

nd M

erto

n G

roup

(C

ypru

s) L

td.

hold

s a

33.3

3% s

take

in

Qin

g M

ei P

te. L

td.

(4

) P

M T

hore

sen

Asi

a H

oldi

ngs

Plc

. hol

ds 1

00%

sta

ke in

Bac

onco

Co.

, Ltd

. and

PM

Tho

rese

n

A

sia

(Sin

gapo

re)

Pte

. Ltd

.

(5)

The

Inv

estm

ents

wer

e cl

assi

fied

as a

sset

s he

ld f

or s

ale

unde

r cu

rren

t as

sest

in t

he c

onso

li

da

ted

finan

cial

sta

tem

ents

as

at 3

0 S

epte

mbe

r 20

14.

Co

rp

or

ATe

sTr

uC

Tur

e 2

014

PMThoresenAsia(Singapore)Pte.Ltd.(

4)


B u s i n e s s S e g m e n t 1 :

T h o r e s e n s h i p p i n g

drY bulK shIppInG


drY bulK shIppInGThoresen shIppInG

BUSINESS REVIEW

TTA operates its dry bulk shipping business undertheThoresenShippingbrandname.ThoresenShippingprovides trampservicesonaglobalbasis.Thevesselsmeet the requirements of ThoresenSpipping’s clientsin thespotmarketunder timechartersandcontractsofaffreightment (“COA”) in addition to short-term timecharters,voyagecharters.Inaddition,thecompanyuseshedgingservicestoreducevolatility.

Thoresen Shipping has delivered highly profitableresults due, at least in part to the company’s focus onprovendesignsthatallowittooperateaconsistentfleetwithmaximum efficiency. In particular, Supramaxeshave been and will continue to be the focus pointof ThoresenShipping’s fleet renewal plan,which aimsto reacha fleetsizeofapproximately30vessels in thenearfutureaspurchaseopportunitiesarise.Resultshavebeenmade possible bymaximizing revenues in nichetradesandgeographies,andminimizing technicalcostsincurredwithintheownershipmodel.

ThoresenShipping operated on a cash positive basisthroughout the year despite a continued environmentofdepressedfreightrates.Thecompanydeliveredagainstits vessel acquisition plans, adding six vessels atreasonable prices in 2014, bringing the total to 24owned vessels (as of 30September 2014),which arecomplementedbyan increasednumberof chartered invessels(18),aspartofacontinuingfleetgrowthinitiative.This represents335,011dwt inadditional fleetcapacitycomparedtothepreviousyear.

While the indexes that trackHandysize andSupramaxdry bulk shipping rates (BHSI and BSI) rose 24% in2014, Thoresen Shipping’s time charter equivalent(TCE)roseby12%implyingtradeatabout101%oftheindexed fleet. The improvement came as a result ofstronger customer relationships and an expandedclient base at Thoresen Shipping’s new commercialhubinSingapore,aswellasitsofficesinCopenhagenandCapeTown.Chartered-inactivityincreasedin2014with

an 18.1 vessel-equivalent compared to 13.1 in 2013.Thoresen’sTCE (owned vessels and chartered-in)wasUSD10,130perdayin2014comparedtoUSD8,681perdayin2013,whichresultedinthecompanyoutperformingtheadjustedBSIby1%.

Themanagement team is also keeping firm control onoperatingcosts.Onafullyearbasis,ThoresenShipping’sowner expenses averaged about USD 3,800 per dayagainstanindustryaverageofapproximatelyUSD5,100,placingThoresenShipping in thetopquartileofownersworldwideintermsofoperatingexpenses.

2014hasbeenanotherstrongyearforThoresenShippingintermsofstrategicdevelopment,withbothcapacityandgeographicalfootprintexpansion,andtheintroductionofthenewcommercialpoolservice.

Lookingaheadto2015,thebusinesswillbenefitfromanincreasednumberofvesseldays,throughtheadditionofthesixnewships,acquiredin2014whichwillberunningat an index fleet of 93% versus 91% in 2013). Thecompany also seeks to further build upon its strategicinitiatives including continued fleet optimization (vesselreplacements and additions), pursuing organic growththrough geographical expansion, and the introductionofthenewcommercialpoolservice.

A: Products and Services

FleetStructure&Services

ThoresenShipping currently owns 24 vessels in total,comprisingofeightHandymaxand16Supramaxvessels,with an average age of 10.43 years and an averageDWTof50,636tonnes.Approximately50%ofThoresenShipping’s vessels are positioned in higher-yieldingAtlantic routes, following theopeningof theCompany’schartering offices inCopenhagen,Denmark andCapeTown,SouthAfricaprovidingageographicalhedgeincaseofmarketfluctuationsbetweenbasins.


FleetStructure

1) Fleet StructureNumber of Vessels

Owned VesselsPeriod

Chartered-in VesselsNewbuild

Vessels on Order Total

Handymax 8 2 - 10

Supramax 16 16 - 32

TOTAL 24 18 - 42

2) DWT - Weighted Average AgeDWT-Weighted Average Age of Vessels

Owned VesselsPeriod

Chartered-in VesselsNewbuild

Vessels on Order Total

Handymax 17.23 13.65 - 14.77

Supramax 7.74 5.16 - 5.47

TOTAL 10.43 6.06 - 6.70

3) Bulk CarriersBULK CARRIERS

Vessel NameOriginal Delivery

Date DWT Age Design Classification

1 ThorDynamic 30/4/1991 43,497 23.44 Standard Bulk>40,000dwt BV

2 ThorWave 30/7/1998 39,042 16.18 OpenHatch/BoxShape <40,000dwt ABS

3 ThorWind 18/11/1998 39,087 15.88 OpenHatch/BoxShape Bulk(Box) ABS

4 ThorEnergy 16/11/1994 42,529 19.88 OpenHatch/BoxShape Bulk(Box) NKK

5 ThorEndeavour 11/4/1995 42,529 19.48 OpenHatch/BoxShape Bulk(Box) NKK

6 ThorEnterprise 28/7/1995 42,529 19.19 OpenHatch/BoxShape Bulk(Box) DNV

7 ThorHarmony 21/3/2002 47,111 12.54 OpenHatch/BoxShape Bulk(Box) DNV

8 ThorHorizon 1/10/2002 47,111 12.01 OpenHatch/BoxShape Bulk(Box) BV

9 ThorAchiever 22/7/2010 57,015 4.73 Standard Bulk>40,000dwt BV

10 ThorIntegrity 2/4/2001 52,375 13.50 Standard Bulk>40,000dwt BV

11 ThorIndependence 20/12/2010 52,407 12.94 Standard Tess-52 NKK

12 ThorInfinity 21/12/2010 52,383 12.66 Standard Tess-52 NKK

13 ThorInsuvi 2/7/2012 52,489 8.88 Standard Tess-52 NKK

14 ThorFriendship 13/1/2010 54,123 4.72 Semi-Open/BoxShape Oshima-53 NKK

15 ThorFortune 15/6/2011 54,123 3.30 Semi-Open/BoxShape Oshima-53 NKK

16 ThorFearless 6/6/2013 54,881 8.90 OpenHatch/BoxShape Oshima-53 NKK

17 ThorBrave 15/11/2012 53,506 1.87 OpenHatch/BoxShape Vinashin DNV

18 ThorBreeze 20/8/2013 53,506 1.11 OpenHatch/BoxShape Vinashin DNV

19 ThorMercury 20/1/2014 55,862 9.00 Standard Bulk>40,000dwt ABS

20 ThorMagnhild 19/2/2014 56,023 8.34 Standard Bulk>40,000dwt NKK

21 ThorMaximus 23/5/2014 55,695 9.00 Standard Oshima-53 KoreanClassed

22 ThorMenelaus 3/6/2014 55,710 8.08 Standard Oshima-53 KoreanClassed

23 ThorMadoc 13/6/2014 55,695 9.17 Standard Oshima-53 KoreanClassed

24 ThorMonadic 7/7/2014 56,026 8.08 Standard Bulk>40,000dwt NKK

TOTAL THORESEN FLEET 1,215,254 DWT

ABS:AmercianBureauofShippingBV:BureauVeritasDNV:DetNorskeVeritasNKK:NipponKaijiKyokai

Source: TTA


Chart: Thoresen Fleet 2006 - 2014

Tramp-TimeCharter

Tramp-VoyageCharter

75%

25%

Chart : Fleet Employment by Vessel Days

Source : TTA

Chart : FY 2014 Cargoes

10LargestCustomers

<USD1,000,000

USD0.5-1,000,000

<USD500,000

5%

12%

37%

46%

Chart : Freight Revenues

Source : TTA

FleetServices

ThoresenShipping’strampservicesderiverevenuesfrom:

Voyage,orspotcharters,whicharechartersbasedonthecurrentmarketrate;Timecharters,wherebyvesselsarecharteredtoclientsforafixedperiodoftimeatratesthataregenerallyfixed,butmaycontainavariablecomponent,suchasaninflationadjustment or a currentmarket rate component; andCOA’s,whichare forwarddeliverycontractsagreeingto thequantityofcargo tobecarried foraclientoveraspecifiedtraderoutewithinafixedperiodoftime.

45 45 44

36

27

15 16 18

24

1,230,5141,266,518 1,243,273

1,050,839

905,809

702,853755,342

880,243

1,215,254

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000DWT

0

5

10

20

25

30

35

40

45

15

50

2006 2007 2008 2009 20112010 2012 2013 2014

Number of Vessels

dwtNo. of Vessels

In connectionwith the charter of each of its vessels,Thoresen Shipping pays commissions to brokersassociatedwiththecharter,rangingfrom1.25%to2.5%ofthetotaldailycharterhirerate.Thecompany’strampbusiness fluctuateswith the supply anddemandof drybulk cargoes for charters on the basis of price, vessellocation,size,age,andconditionofthevessel,aswellasonitsreputationasanownerandoperator.

B: Marketing and Competition

I.Client&TargetCustomer,DistributionChannels

Clients & Target Customers

ThefocusforThoresenShippingin2014remainedoncorepremium cargoes with industrial majors coming intofocus during the year as a result of an increasinglycustomer-centricapproachoutofthecompany’sSingaporecommercialhub,aswellasitsnewofficesinCopenhagenandCapetown.Over the last year, ThoresenShippinghasalsoincreasinglytakenadvantageofspot-charteringopportunitiesforkeyclientswithimmediaterequirementsforshipsinkeymarketswherethoseclientshavecargobutnotmatchingassets.Thetopfivecargo-typesloadedduring 2014 included sand, coal,mineral/concentrate,agricultureproducts,andsteelproducts.

Throughout2014,ThoresenShipping’sbulkcarriervesselscontinuedtobedeployedintradeswhichservicetheneedsof clients in a blendofCOA’s, timeand spot charters.Thoresen Shipping’s box shaped vessels, which aresuitable for bulk cargoes but are specifically designedforunitisedbreakbulktradessuchaswoodpulp,windmills,steelandpipes,havealsobeendeployed inablendofCOA,periodcharter,andspottramping.

Geographically,thefleetisequallydistributedbetweentheAtlantic,IndianandPacificOceans.

Source : TTA

MACHINERY&EQUIPMENT

SAND

COAL

MINERALCONCENTERATE

AGRICULTURALPRODUCTS

STEELPRODUCTS

CEMENT

FERTILIZER

IRON

PAPERWOODENPRODUCTS

OTHERGENERALCARGOES

30.31%

19.41%16.07%

11.96%

8.74%

6.51%

3.41%2.38%

0.84% 0.31%0.06%

Source : TTA


ThoresenShipping hasmade strong progress towardsdeveloping relationships with industrial majors bymaintaining a strong ranking with Industry qualitycontrollers-Rightship.Thisactsasanindextomeasurethe key criteria for large industrial clients, such asBHP Billiton, Rio Tinto Shipping, and Cargill OceanTransportation.

Distribution Channels

ThoresenShippingboastshighlyskilledformermariners,managingboththetechnicalandcommercialoperationswithin the office in Bangkok. In Singapore, ThoresenShipping’s commercial team is experienced andknowledgeable, and has under its belt deep industryrelationships. While the companymaintained strongcontroloveroperationalcosts,italsofurtherstrengtheneditsglobal footprint in2014with theestablishmentofanofficeinCapeTown,SouthAfrica,followingtheopeningof its first European office in Copenhagen, Denmarkin2013.ThecompanyplanstoopenanofficeintheUnitedArabEmiratesinJanuary2015andeventuallytoestablishapresenceintheUnitedStates.

II.Industry&Outlook

Year in Review

The shipping industrywas generally healthy in 2014,showingsignsofrecoveryearlyintheyear,strengtheningin the second quarter, before showing some signs ofvolatility later in the year. Towards theendof the yearthe industry witnessed some temporary disruptionincludingadeclineinironoreexportsfromBrazil,adelayin grain exports fromSouth America, and an exportbanonIndonesia’snickeloreandbauxiteoutput.

Demand

Threesignificantfactorsplayedanimportantroleonthedemandsideofthedrybulkmarketin2014.ThesewereChineseironoreimports,Chinesesteamcoalimports,andIndonesia’sbanonmineraloreexports.

Fromthesecondquarteroftheyear,Chinesesteamcoalimportsfellfromanannualizedpaceof215milliontonnesinQ12014toapaceof176milliontonnesinthesecondquarter.Thisaffectedtheglobalsteamcoaltrade,whichdeclined5.5%betweenthefirstandsecondquartersof2014–itslargestquarterlydropin15years.Thishasbeenattributedtoslowerelectricitydemandgrowthandasharpincrease in production fromalternative energy sources.In particular, a large hydroelectric dam became fullyoperationalin2014,generatingthesameamountofpoweras a 40+million tonne coal plant. This new capacity,itappears,istoreplacecoal-generatedpower,whichhasresultedinascalingbackincoaldemand.

Incontrasttotheweaknessseeninrelationtocoaltrade,theironoreandsteelsegmentsclimbedtonewhighs.

Globaldemand forsteel isheavily influencedbyChina.China’s fixed asset investments grewmore than 16%year on year, to USD 5.83 trillion during the periodJanuary toSeptember 2014, on thebackof increasinginvestment in the railway, infrastructure, housing andconstructionsectors.Theassociatedgrowth indemandfromChina for imported iron ore is also likely to havehadapositive impacton thedrybulkshipping industry.IronoreimportstoChinaareexpectedtobe930milliontonnesduetorisingcrudesteeloutputinChina,accordingtotheMetallurgicalMines’AssociationofChina.

Over the last five years, steel production inChina hashad a compounded annual growth rate of 9.1%,comparedwith global production at 3.5% per annum,according to Fearnleys. As a result of this growth insteelproduction,Chinese importsof ironorehavealsoincreasedsubstantially.

This can be partially attributed to international iron orepriceshavingplummetedwithmorenewsuppliescomingonto themarket. This has created a strong demandforseabornetradeofironore,particularlyfromAustraliaandBrazilwhichhas led to longer shippingdistances,accordingtoFearnleys.

640

680

720

760

800

840

2012.1

Chinese Steam Coal Imports Chinese Iron Ore Imports

2013.1 2014.1

880

923

900 240

230

190

200

210

220

160

170

180Iron

Ore

Impo

rts,

m 1

ann

Coa

l Im

port

s, m

tann

Source: Marsoft

Chart : Chinese Iron Ore Imports

2006

World Steel Production million Tonnes (left axis)

Chinese Market Share (right axis)

0 0%

10%

20%

30%

40%

50%

60%

500

1,500

1,000

2,000

2007 2008 2009 2010 2011 2012 2013 9M2014

Source: Fearnleys

Chart : Steel Production


Thegraintradewasestimated(byMarsoft)tohavefallenback6% in tonne-mile terms, relative to its recordhighinthelastquarterof2013,showingalargerthannormalseasonal decline due toweakerSouthAmerican grainexports. US exports also fell back significantly in thesecondquarter,mainlyduetoasharpdropinshipmentstoChina.Chinaalsocontinuedtocancelsomecorncargoesduetoconcernsovergeneticallymodifiedseeds.

Supply

Deliveriesofnewdrycargovesselsintothemarkethasfor quite some time outpaced demand growth, andthisappearstohavecontinued.

Scrappinghasalsosloweddownasvesselsinthemarketarebecomingyounger.DrybulkscrappingrosefromthreemillionDWTinQ12014tofourmillionDWTinthesecondquarter,althoughfirsthalfscrappingtotalwasdown50%yearonyear.Drybulkorderingactivityalsoappearstohaveslowed.

Freight rates have remained low for themost of 2014,according to Fearnleys, although the larger segments,especiallyCapesizehavedemonstrated somevolatility.Fearnleys indicates that Capesize rates picked up inthefourthquarterbuthavenotbeenfollowedbyPanamaxincreases.SupramaxandHandysizerateshaveremainedmorestablethrough2014.

SupramaxspotearningsfellfromUSD11,700perdayatthestartoftheyeartoUSD9,100perdayinthesecondquarter,whileHandysizeratesfellfromUSD10,000perdaytoUSD7,500perdayoverthesameperiod.

In termsofutilization,after reachinga two-yearhighof89% in the fourth quarter of 2013,Marsoft expectsutilizationratestohavefallenbackto86.6%inthesecondquarterof2014beforereturningto88.7%byyear-end.

SecondhandpricesforHandymaxandSupramaxvesselsdipped in early 2014, although still rose 10-20% yearonyear.

Outlook

Strong iron ore trade and slower fleet growth shouldmoderatelyboostratesthrough2015,accordingtoMarsoft.

Demand

Thescalingbackofsteamcoaldemandislikelytocontinue,as theChinese government has called for increasedmarketsharefromnon-carbonenergysourcesby2015,aspart of its five yearplan.However,Marsoft believesthereremainsroomforChinesecoaldemandtorisebyafurther1-2%peryear,showingmodestgrowththrough2018.

TheWorldSteelAssociationhasforecastedglobalsteelusetorise2%in2015to1.594billiontonnes,itsaid,downfromapreviousforecastfor3.3%growth.

Globally,ironoretradeisexpectedtogrowatanannualpaceof7%from2015to2018.InChina,asdomesticironoreoutputisexpectedtofallbybetween10and20%peryearthrough2018,Marsoftexpectsmorenewsuppliesofironoretocomeintothemarket,which,itsays,wouldsetthestageforafurtherboominChineseimports.Thehighendoftheseprojectionswouldleadtoanadditional120milliontonnesofimportsby2018.

Chart: Chinese Iron Ore Imports: High case and Base case

2011.1600

700

800

900

1,100

1,200

1,300

1,400USD

1,000

m to

nnes

2012.1 2013.1 2014.1

High Case Base Case

2015.1 2016.1 2017.1 2018.1

Supply

Freightratesareexpectedtoremainfundamentallypositiveinmediumtolong‐runasaresultofcontinuedstronggrowthin demand andminimal global fleet growth, howeverMarsoft’soutlookhasbeenmutedsomewhat.

It is possible to gain some insight into future levels ofsupply by reviewing the relationship between the totalorderbookandtheexistingfleet.Fewercancellationsanddelaysofnewbuildingswerewitnessedin2014,accordingtoFearnleys,whoexpectmostofthecurrentorderbookto be delivered.As ofNovember 2014, the global drybulkorderbookamountedto144.6milliondwt,or19.3%of the existing dry bulk fleet. 61million dwt startedtradingin2013,whiledeliverieshavesloweddownin2014.Fearnleysexpectsdeliveriestopickupagainin2015.

Deliveriesin2016and2017couldbefewerthanoriginallyexpected,whichwouldlimittheimpactduringthatperiod.

Totalorderingactivity,acrossallship types isexpectedtopick-upagainoverthenextyeartoeighteenmonths,which combinedwith the rise in steel plate prices andfirm freight rates,will putupwardpressureonnewbuildvesselprices.

Source : Marsoft


Table : Dry Bulk Carrier Orderbook – November 2014

Size Category Deadweight Tonnes Number of VesselsTotal Capacity (million dwt)

% of ExistingFleet (dwt)

VLOC 200,000+ 155 35.0 35.8

Capesize 100,000–200,000 179 31.2 14.9

Panamax 70,000–100,000 325 26.6 14.7

Ultramax 60,000–70,000 488 30.7 115.6

Supramax 50,000–60,000 85 4.8 4.4

Handymax 40,000–50,000 49 2.2 5.6

Handysize 10,000–40,000 402 14.3 16.2

Total 1,683 144.6 19.3Source: Fearnleys

2011.16,000

7,000

8,000

9,000

10,000

11,000

US

D/D

AY

12,000

13,000

14,000

15,000

16,000

2012.1

Small Handy Supramax

2013.1 2014.1 2015.1 2016.1 2017.1 2018.1

0

10,000

20,000

2014 2015 2016 2017 2018

30,000

40,000

50,000

‘000

DW

T

60,000

70,000

10-25 2540 40-50 50-60 60-70 70-100 100-200 200+

Source: Fearnleys

Chart: Dry Bulk Carrier Orderbook by scheduled year of delivery - November 2014

Chart: One-year TC rate, Supramax (51,000 DWT) and Small Handy (27,000 DWT): Base case

SecondhandpricesforHandymaxandSupramaxvesselsareexpectedtofallbackbeforerisingmoderatelythroughearly2016.Afive-yearoldHandymaxisexpectedtobevaluedataboveUSD20millionin2015.ThesameageSupramax isexpected to fetchup toUSD24millionbyearly2016.

Spot ratesareexpected tomoveupmodestlyover thecomingyear,whilesomeindustryperiodcharterratesareprojectedtomovedownslightly,beforerecoveringattheendof the year and into2015.SupramaxearningsareexpectedtoaverageUSD10,500perdayoverthecomingyear,withMarsoft expecting the rate to peak atUSD13,000per day in the secondhalf of 2015.The rate isexpectedtofallbackmodestlyin2016beforesettlingatUSD11,200perday in2017,beforeedgingbackuptoUSD11,500 in 2018.SimilarlyHandysizeearningsareprojectedtoaverageUSD8,500perdayoverthecomingmonths,withapeakofUSD9,600perdayexpectedduringthesecondhalfof2015.HandysizeratesareprojectedtodipbelowUSD9,000perdayin2017,followedbyamildrecoveryin2018.

In 2015, fleet utilization is expected to average88.5%,compared toanaverageof87.5%for2014asawholeduetodemandgrowth(5.6%)outpacingfleetexpansion(4.4%)by1.2%.

Competitive Landscape

The dry bulk industry remains highly competitive andfragmented,with ownership of general cargo and drybulk vessels from15,000 to 59,999deadweight tonnesdividedamongstapproximately1,364independentownerswith5,983vessels.

Chart: Vessel Owners (15,000 – 59,999 dwt)

Source: TTA

1-4Vessels

5-9Vessels

10-14Vessels

15-19Vessels

>20Vessels

32%

21%10%

8%

29%

Source : Marsoft




offshore servICesm e r m a i d m a r i t i m e p u b l i c C o m p a n y l i m i t e d


offshore servICesmermAId mArITIme publIC CompAnY lImITed

BUSINESS REVIEW

The offshore services segment is primarily driven byMermaidMaritimePublicCompanyLimited(“Mermaid”),inwhichTTAholdsa57.42%stakeasof30September2014. Mermaid, commenced its operations in 1983,waspartiallyacquiredbyTTAin1995andwassuccessfullylistedon theSingaporeStockExchange (“SGX”)on16October2007.

Asarecognisedgloballeaderintheprovisionoftender-assisted rig drilling and sub-sea engineering servicesfor the offshore oil and gas industry globally,Mermaidprovides subsea engineering and offshore drillingservicestomajoroilandgascompaniesortheircontractorsprimarilyintheAsia-PacificandMiddleEastregions.

AlongsideitscorporateheadquartersinThailand,MermaidhasoperationalbasesinThailand,Singapore,Indonesia,Qatar, Saudi Arabia and theUnitedArabEmirates tosupport itsclients. Today,Mermaid isoneofahandfulofAsian-basedprovidersofoffshoreservices,withateamof over 1,000 professional divers, drillers, technicians,surveyors,managementandsupportstaff.

Inthe2014financialyear,Mermaidbuiltonthesuccessofthepreviousyearsandfurtherdevelopeditsplatformforgrowth,stabilityandmostimportantlyprofitability.Mermaidwonmultiple subsea contracts across various regions,achievedhighvesselutilizationandexpandeditsrevenuebasethroughthecharter-inofadditionalvesselstofulfilstrongdemandforitsservices.ThiscumulatedinMermaidachievinghistoricalnetprofitofUSD45.3millionwhichistripleofthepreviousyear2013.

In 2013,Mermaid successfully completed fundraisinginitiativesthatprovidedapproximatelySGD176.1million(USD140.8million)ofcapitalforfurtherinvestmentinthebusiness. Someof these fundswereput touseat thebeginningof2014,asMermaidenteredintoagreementstobuild twonewtenderrigsandonenewDiveSupportVessel (“DSV”)withChinaMerchants IndustryHoldingsCo.,Ltd.foranaggregatesumofUSD436million(USD149million for each tender rig andUSD 138millionforDSV).Thetwonew‐build tenderrigs,namedMTR-3andMTR-4,arescheduledtobedeliveredinthefirsthalf

of2016whilethenew‐buildDSV,namedMermaidAusana,isexpectedtobedeliveredinthethirdquarterof2016.

Thesenewadditions to the fleetwill not only enhanceMermaidMaritime’s market position in terms of themodernizationofitsfleet,butwillalsoexpandthesizeoftherigsandvessels inorder toenhance itsoffshoreoilandgassupportservicesandachievegreatereconomiesofscale.

With recent weakness in oil price, Mermaid has acautionary perspective on the oil andgas outlook overthenext12months,giventhattheoilandgascompaniesmay be reviewing their spending. In themean time,Mermaidcontinuestoseestabledemandfor itssubseavesselsandrelatedservicesontheseprojects.Mermaid’sfleet of subsea vessels and drilling rigs are shallowwaterbiasedwhich isknown tobemoredefensiveandlessaffectedbyloweroilprices.Thisisbecausebreakevencostsofsuch fieldsare reported tobe lower thandeeperwaterfieldsandthereforelesslikelytobesubjecttocontractioninservicedemand.

Inthismarketcondition,Mermaidretainslowgearingandsufficientcashreservesthusallowingtheabilitytocontinuetoremainagileandtobereadytotakeadvantageofanyopportunisticandorganicgrowththatmaypresentitselfinthepresenttime.


FleetStructureandServices

Subsea Services

Mermaid’s subsea engineering centres around divingand remote intervention by unmanned submersibles(“ROV”).ItssubseadivisionisrepresentedbyMermaidOffshore Services, Subtech, and Seascape Surveys.Allthreesubseaunitswereintegratedandnowoperateunderthesamenewcompanynameas“MermaidSubseaServices”. A wide range of subsea engineeringservices are provided, including inspection, repair andmaintenance, constructionand installation support, andcommissioningprojects.


Revenuegrowthfromoursubseabusinesswasbackedbyhigherdayratesofownedvesselswhichwereup10%yearonyear,whileaveragesubseavesselutilizationratein2014was66%,slightlylowerthan69%in2013.

Asof 30September2014, the subsea fleet consists of7subseasupportvessels(includingcharteredinvessels),3ofwhicharespecialiseddivesupportvessels,and15ROVsystems,includingdeepwaterandultra-deepwaterheavyconstructionclasssystems.Apartfromitskeyassets,theSubseaDivision sub-contracts up to 500 specialistandmarinepersonneltoworkonitssubseaengineeringprojectsinadditiontoapermanentworkforce.

Types of Subsea Vessels

Inbroadtermsthesubseavesselmarketcanbedividedintooffshoreconstructionvessels(OCV)andconstructionsupportvessels.

VesselsfallingundertheOCVcategoryarestableplatformswith large cargo decks, accommodation facilities andlarger tools such as larger active heave compensationsubseacrane(s),remotelyoperatedvehicle(ROV)handlingequipment,moonpool(s),winchesetc. Except from theheaviest installationwork,most of theOCVwork canbe performed by smaller, less expensive vessels alsoreferredtoasconstructionsupportvessels.

TheOCVwilloftenperformtheworkaspartofa largersubseacampaigns,butsubseacontractorsalsochartersmallerconstructionsupportvesselsforpartsofthework.Thesmallersupportvesselsarealsocharteredindirectlybytheoilcompaniesforinspection,maintenanceandrepairwork.Thesubseaconstructionsupportvesselsencompasssmaller multipurpose vessels, typically equippedwithmediumsizecranes,ROVandalsoaccommodationcapacity. Most subsea vessels are equipped with aDynamicPositioningsystem.

Thesubseaorderbookhasseenstablegrowthinrecentyears,butisexpectedtodecline.Therearenowalmost120subseavesselsunderconstruction.Severalsubseavesselswereorderedduringfirsthalfof2014,whilesecondhalfoftheyearhasbeenmuchquieterwithonlyahandfulofneworders,mostlydivingvessels.

Fleet and Diving Services

AllvesselsareclassifiedbyDNVorABS,whicharetwoof the leading classification societies. All vessels aresubjecttoregularinspectionbyclasssurveyors,inadditiontoregulardry-dockingandotherplannedmaintenance.

AnothercorecompetencyfortheSubseaDivisionisrunningitsdivingoperationstoworldclassstandards,especiallythose set by the InternationalOil andGasProducersAssociation (“OGP”). A number of newbids, includingtheonethatMermaidrecentlywonfromSaudiAramco,includeOGPcertificationasamainprecondition.

Table : Mermaid Subsea Fleet List

No. Name of Vessels Vessel Type Calendar Year

Build Year Purchase Year

1. MermaidCommander DP2DiveSupportVessel 1987 2005

2. MermaidEndurer DP2DiveSupportVessel 2010 2010

3. MermaidAsiana DP2DiveSupportVessel 2010 2010

4. MermaidSapphire DP2ROVSupportVessel 2009 2009

5. MermaidChallenger GeneralUtilityVessel 2008 2008

6. S.S.Barakuda GeneralUtilityVessel 1982 2010

7. Endeavour DP2ROVSupportVessel 2008 2012(Chartered-in)

8. Resolution DP2ROV/Divingsupportvessel 2013 2013(Chartered-in)

9. MubarakSupporter DP2constructionbarge 2014 2014(Chartered-in)

10. BourbonEvolution806

DP3multi-purposesubseasupportservicesvessel

2013 November2014(Chatered-in)

11. SiemDaya2 DP3offshoresubseaconstructionvessel 2013 November2014(Chatered-in)

12. Windermere DP2divingsupportvessel 2010 2014(Chatered-in)

13. NewDSVMermaidAusana*

DiveSupportVessel 2015/16 15%in201485%in2016

Note :*Underconstructionwithdeliveryin2016


ThefollowingdetailstheSubseaDivision’scoreservices:

Exploration services Pre-installation surveys; rig positioning and installation assistance, subsea equipmentmaintenance.

Development services Installationofsubseapipelines,flowlines,controlumbilicals,manifolds,risers,pipelayandburial, installationand tie-inof riserandmanifoldassembly;commissioning, testing,andinspection;andcableandumbilicallayandconnection.

Production Services Inspection,maintenance,andrepairofproductionstructure,risers,pipelines,andsubseaequipment.

Drilling Services

MermaidDrillingLtd.(“MDL”),a95%-ownedsubsidiaryofMermaid,ownstwotenderdrillingrigsandprovidesdrillingandaccommodationbargerelated-servicesinSoutheastAsia.

AsiaOffshoreDrilling(“AOD”),Mermaid’s33.8%‐ownedassociatecompanywhichownsandoperatesamodernfleetofhighspecificationjack-uprigs,addedthreejack‐uprigsAOD-I,AOD-II,andAOD-IIIin2013.In2014,AODenteredthesecondyearofa three-yearcontractwithSaudiAramcowith total revenuesofUSD220.9million. In2014,weachievedan94%utilizationrateonaverageforthethreenewjack‐uprigs.

Table : Drilling Rig Fleet List

No. Name of Rigs Rig Type Calendar Year

Build Year Purchase Year

1. MTR-1 AccommodationBarge 1978 2005

2. MTR-2 TenderAssistDrillingRig 1981 2005

3. AOR-1 PremiumJack-UpRig 2013 2010



6. NewtenderrigMTR3* Tenderrig 2015/16 15%in201485%in2016

7. NewtenderrigMTR4** Tenderrig 2015/16 15%in201485%in2016

Note :*ScheduledfordeliveryinQ1/2016 **ScheduledfordeliveryinQ2/2016

Bothjack-upandtenderdrillingrigsrequireclassificationfroma recognized classification society,which classifythembasedonstructuralintegrityandsafety.MDL’stenderdrillingrigsareclassifiedbyinternationalbodiessuchasDetNorskeVeritas(“DNV”),AmericanBureauofShipping(“ABS”), or BureauVeritas (“BV”).MTR-1 is classifiedbyABS, andMTR-2 is classified byBV.Classificationauthoritiesinspectthetenderdrillingrigsannually.Tenderdrillingrigsaredrydockedeveryfiveyearsandsubjecttoaspecialperiodicsurveybytheseclassificationsocieties.AOD’sjack-uprigsaresubjecttoclassificationbyABS.

Fleet Services

MDL’s contracts to provide offshore drilling servicesare individually negotiated and vary in their terms andprovisions.MDL obtainsmost of its contracts throughcompetitive bidding against other contractors. Drillingcontracts generally provide for payment on a day ratebasis,withhigherrateswhilethedrillingunitisoperatingandlowerratesforperiodsofmobilizationorwhendrillingoperations are interrupted or restricted by equipment

breakdowns,adverseenvironmentalconditions,orotherconditionsoftenbeyondMDL’scontrol.

Adayratedrillingcontractgenerallyextendsoveraperiodoftimecoveringeitherthedrillingofasinglewellorgroupofwellsorcoveringastatedterm.SomeofMDL’scontractswithclientsmaybecancellableattheoptionoftheclientupon payment of an early termination payment. Suchpaymentsmaynot,however, fullycompensateMDL forthelossofthecontract.

AOD’sthreejack-uprigsarefromtheModV–BClassdesign,which isunderstood tobe thepreferred jack-uprig design bymajor drilling companies andusedby oilcompanies inall shallowwaterareasof theworld.TherigsaredesignedforyearroundoperationsintheareasofGulfofMexico,IndianOcean,SouthernNorthSea,CoastofMiddleEast,OffshoreIndia,OffshoreAustralia,OffshoreNewZealand,andOffshoreSouthEastAsia. Intoday’senvironment, rigs are typically contracted for durationsof300daysorlonger.



I.ClientsandTargetCustomers,DistributionChannels

Subsea Services

Clients

Major and independent oil and gas producers andsuppliers,pipelinetransmissioncompanies,andoffshoreengineering and construction firms trustMermaid astheir partner. In 2014, subsea serviceswere providedtoover40clients.

Clients in theMiddleEast remain a significant part ofMermaid’sbusiness.Asignificantdivingcontractsecuredin2013throughtheCompany’sMiddleEastjointventure,Zamil,Mermaid continues to buoyMermaid’s revenuesandreturns,andwillcontinuetodosountilendof2017withanoptiontoextend.

InSeptember2014,MermaidwasawardedtwosaturationdivingcontractsintheMiddleEastwithatotalestimatedvalueofUSD45million.ThecontractsarebeingservicedbycharteringinDP3MultipurposeSupportVessel‘BourbonEvolution’due to the fleet high utilization rates onexisting contracts. BothContracts are estimated to beapproximately6‐8monthsindurationintotal.Thefirstofthese two Contracts has already commenced andthe secondwill start back‐to‐back upon completion ofthe first. Mermaidwill also deploy specialized divingequipment, remotely operated vehicles (“ROVs”),specialized divers and other project crew to provide afullintegratedserviceundertheseContracts.

InAsia, aUSD55million, two-year contract to provideoffshore inspection, repair, andmaintenance (“IRM”)services to amajor Indonesia-basedupstreamoil andgasoperator continues to run smoothly, andwill do sountil the contract end inSeptember 2015 (awarded toSeascape,asubsidiaryofMermaid).

Another recent contractwin includes a two-year,USD19million,contractfor“MOS’tosupplysubsearemotelyoperated vehicle services in Thailand, servingmajorupstreamoil&gasoperators.

In addition,Mermaid continues to implement its growthstrategy by expanding its revenue base throughchartering-in additional vesselsagainst confirmedclientcontracts as demand for its subsea services continuestoexperiencegrowthinitstargetedmarkets.

InDecember 2013,Mermaid took delivery of theDP2RSV ‘Resolution’ ona2+1year charter to servicenewcontractsinIndonesia.ThiswasfollowedinJune2014bya short term charter of theDP2PSV ‘LewekAtria’ forseveralmonthstoserveacontractintheGulfofThailand.

Inaddition,inAugust2014,MermaidtookdeliveryofDP2Construction(CLB)Barge‘MubarakSupporter’ona1+1+1year.

MermaidexpectstopaceregionalgrowthfortheSubseaDivisionacrosstheMiddleEast,SouthEastAsiaandtheNorthSeaoverthenextfewyears.

Mermaid also continues tomaximize vessel utilizationwhileatthesametime,focusingonvalue‐addedservicesto customers and longer contract durations in growtharease.g.SouthEastAsia,theMiddleEastandtheNorthSea.

Employees

The SubseaDivision relies on the high quality of itsspecializedworkforce.Asof30September2014,MermaidSubseaServiceshadover290personnelspreadacrossThailand,Qatar,SaudiArabiaandIndonesia.

Competition

Themarinecontractingindustryishighlycompetitive.Whilepriceisafactor,theabilitytoacquirespecializedvessels,attract and retain skilled personnel, and demonstratea proven safety record is also important. TheSubseaDivision’s competitors include a number of local firmsbased in Asia and theMiddle East aswell as largerinternational companies based inEurope and theUS,most of which aremajor Engineering, Procurement,Installation,andCommissioning(“EPIC”)contractors.

This doeshowever remaina nichemarket,with limitednumbers of providers and units globally, prospectsremainpositiveforsubseaengineeringservices.Mermaidcontinuestoseesoliddemandforitssubseavesselsandrelatedservicesasevidencedbycontractawardssecuredaswellasongoingadditionalrequirementsfrombothpo-tentialandongoingcustomers.

Drilling Services

Clients

MDLengagesinoffshoredrillingforleadinginternationaloilcompanies,includingthosethatarebothgovernment-controlled and independent. MTR-1 was standby forthe year and is beingmarketed as an accommodationsupportbarge.MTR‐2operatedat98%utilization in2014,and was deployed on a two‐year drilling contract inIndonesia withChevron. However, the unit has beenterminated early inDecember 2014 due to customer’sinabilitytosecuretheirowngovernmentpermits.ThesaideventshavealloccurredthroughnofaultofMermaid.

Three ofAOD’s jack-up rigs continued to serveSaudiAramco, the world’s largest oil and gas company intheworld,with its current contract ending inQ4 2016


(withanoptiontoextendto2017).Asaresult,AODwasable to achieve an outstanding utilization rate of 94%onaverage for these three jack-up rigs in linewith theCompany’s target.Thiswasprimarilydue toall jack-uprigs experiencing high operating performance withlimiteddowntime. TheCompany isconfident thatAODwill continue to serve the same customer beyond thisterm as observed by short tomedium term contractextensionsawardedbythesamecustomertootherjack-uprigcontractorswhosetermshadrecentlyexpired.

Employees

MDL requires highly skilled personnel to operate itsdrilling rigs. As a result, MDL conducts extensivepersonnel recruiting, training and safety programmes.As of 30 September 2014, MDL had 42 staff andpersonnel.

Competition

MDL’s primary competitors include global or regionaloffshoredrillingcompanies,includingMalaysianoffshoreservices company Sapura Kencana. The deal willmakeSapuraKencana the largest operator of tenderrigsintheworld.

Themajority (80%)of the tender rigs operate inSouthEastAsia,oncontractsrangingbetweenonetofiveyears.Themarketfortenderrigsisanichemarketthatgenerallyexperiencethesamecyclesasthemarketforothermobileoffshore drilling units in general, andwith jack-ups inparticular.ThereisalsogrowinginterestintheareajustoffWestAfrica.

Thetenderingfleetisagingwithalmosthalfoftheglobalfleet over 30 years old. There are 25 available unitsgloballywith 15 on contract,mostly being newer rigs,and 10 off contract either stacked orwaiting for nextcontract,beingolderrigs.Ofthe15oncontract,10arelocated in South East Asia and five are located inWestAfrica. There are also an additional seven newbuildtenderrigsunderconstructionwhicharescheduledfordeliveryin2015and2016.

II.Industry&Outlook

Summary Overview

Thedemandfordrillingandsubseaengineeringservicesisdrivenbythelevelofactivityinexploration,developmentandproduction of crude oil and natural gas. Importantinfluencing factors are theaccess to available offshorefields for development and the oil companies’ ability todrill and develop the fields based on their cash flow,revenuesand financing.Themost important influencingfactor for theactivity level is theoil andgasprices, astheydeterminethenetpresentvalueofthedevelopmentsolutions.

Exploration and production budgets saw double-digitgrowthfrom2003to2008,whichledtoexceptionallyhighlevels of activity in the drilling and subseaengineeringservicesmarkets.Aftermanyyearsofheavyinvestment,explorationandproductionspendingsawadecrease in2009,whenspendingsloweddownduetoasharpdecreaseinoilprices,expensivefinancingandgeneralslowdownintheglobaleconomy.Theresultingreductioninexplorationspendingin2009didn’tlastforlonghoweverandby2010theactivitylevelwasabove2008levelsandhascontinuedtoincreaseeveryyearsincethen.

Chart: Year-on-Year Increase in E&P Spending and Increase in Offshore Services Demand

700 250

200

150

100

50

0

600

500

400

300

200

100

0

($ billion)

Vessel Y

ears

E&P Spending Demand

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

1995

Source: Strategic Offshore Research

Thatsaid,thepastyearhasbeenincreasinglychallengingfortheoffshoreindustrywithoilmajorcontinuouslyreviewE&Pspendingthroughout2014duetoescalatingcosts,geopoliticalfactorsandfinallytherecentweaknessinoilprice.

Inanycase,E&Phastocontinuetokeepupwithglobaldemand,settoriseby1.1millionbarrelsperday(“bpd”)in2015.Depleting reservesandanaging fleetensuresthat the industry fundamentals should remain strong.Offshoreoilproductionhasbeendominatedbyshallowwaterdrillingandmorerecentlyresourcesandexplorationdrillingindeepwaterareasthatrepresentthenewgrowthareas. This is due to both technological developmentsthat havemade exploration feasible andmore costeffective,andhighoilandgasprices.Althoughinternationaloilcompanies(“IOCs”)maybereviewingtheexpenditureplans, at some point they are expected to resumespendingtoreplenishreserves.Atthesametime,nationaloil companies (“NOCs”) steered by their respectivegovernmenttodrivegrowthshouldcontinuetoraisetheirexpenditure andmake up for any temporal shortfallinspendingbytheIOCs.


Subseaserviceshaveremainedindemandinallphasesoftheoil/gasfields,withsurveyandinstallationduringthefield development phase,maintenance and repair inthe production phase and support services in thedecommissioningphase.Thedemandforsubseacapacityisexperiencingsteadygrowthworldwide,andAsiaPacificisoneoftheregionsdemonstratingthelargestgrowth.

Drillingserviceshavealsoexperiencedincreasedutilizationandstrengtheningofdayrates.IntheAsiaPacificregion,there has been continueddemandwithin the premiumjack-upandtenderrigmarketsegment.

Offshore Market Drivers

OilpriceshavebeeninsteepdeclinesinceJune2014.TheInternationalEnergyAgency(“IEA”)opinedthattherootcauseofthefallinpriceswasasurgeinnon-OPECsupplytoitshighestgrowtheverandcontractionindemandgrowthtofive‐yearlows.Severalyearsofhighoilpricesprompteddrillers around theworld to developnewoil fields.Theresultisthatnewsupplyisnowsurpassingdemand.

Chart: Brent Spot Price FOB

Tothisend,OPEChadreportedinDecember2014thatshouldthecurrentfallincrudepricescontinueoveralongperiod, itwill impact thenon-OPECsupply forecast for2015,especiallyanticipatedgrowthintightcrude(i.e.shaleoil).

As for the effect onE&P activity, FearnleysOffshoreexpects reduction in E&P activity in the coming year2015,andcontinuetowaitforthefulleffectoftheongoingcost cutting schemes already implemented throughout2014, asmanyof the service areasbeing cutwill takesometimetophaseout.

Apartfromoilprices,themarketisalsobeingaffectedbyoperators’ underlying continued focus on cost savingsfollowing a period of significant increasedexpendituresthroughouttheindustryoverthepastnumberofyears.

Chart: Historical E&P Spending and Oil Price

19900

50

100

150Dollars per Barrel

1995 2000 2005 2010 2015

Europe Brent Spot Price FOB

Dollars per Million Btu

01998 2000 2002 2004 2006 2008 2010 2012 2014

10

5

15

Henry Hub Natural Gas Spot Price

Source: Fearnleys

This decline in oil pricewill likely further increase oilcompanies’tendencytopostponenewdevelopments,andthusprolongthecurrentmarketdownturnbeyond2015,putting particular pressure on frontier and higher costexploration companies. Exploration projects in harsherenvironmentssuchastheArcticwilllikelybeabandonedorpostponedasthecashbreakevenatthecurrentoilpricewillleavetheseprojectsinthered.Oilcompanieswillmostlikely continue to develop the existing fields whereinfrastructure is already in place, where additionalproductionislessfinanciallystraining.

Whilemanycommentatorsexpectthat2015willrepresentanotherchallengingyearfortheindustryasawhole,manyhavealsoidentifiedseveral‘brightspots’intheindustry.Inparticular,FearnleysOffshorereportedthattheyremainoptimisticthatMermaidisideallypositionedasoneofthose‘brightspots’thatarepresentingthemselves.

2014wasabusy year for the subsea contractors,withstrong tenderingactivity for newsubsea contracts.Themarkets with the most momentum were the NorthSea,MiddleEast,SouthEastAsia,BrazilandtheGulfofMexico.

Source: U.S. Energy Information Administration

Chart: Henry Hub Natural Gas Spot Price

Source: U.S. Energy Information Administration

E&

P s

pe

nd

ing

(U

Sd

bn

)

0 -20%

-10%

0%

10%

20%

30%

40%

2003 2004 2005 2006 2007 2008 2009 2010 2012 2013e 2014e2011

50

100

150

200

250

300

350

400

450based on 52 oil co’s-preliminary for 2013, CS for 2014

E&P spending Growth rate

gro

wth

ra

te(%

)


Theincreaseddemandforsubseaconstruction,andveryfewnewsubseavesselsenteringthemarketintherecentyears,hadalsoputanupwardpressureonthevesseldayrates.

InStrategicOffshoreResearch’s“GlobalSubseaMarketto2017”publishedinFebruary2014,StrategicOffshoreforecastedsubseademandgrowth tobe incremental in2015andthentoaccelerateagainin2016and2017.

Chart: Forecasted Subsea Demand to 2017

Themajority of the tender rigs operate in SouthEastAsia,oncontractsrangingbetweenonetofiveyears.Themarket for tender rigs is a nichemarket that generallyexperiencethesamecyclesasthemarketforothermobileoffshore drilling units (“MODUs”) in general, andwithjack-uprigsinparticular.

Tenderrigsprovideproductiondrillingcapabilitiesandcanwork in any seabed condition including areaswherejack-uprigsmaynotbeabletoaccess.Thedayratesoftenderrigsarealsolowerthanjack-uprigs,offeringalowcostproductiondrillingsolutiontocustomers.ThelevelofactivityfortenderrigsinSouthEastAsiahastraditionallyremainedrelativelystablewithutilizationfornewerunitsremainingcloseto100%,ascustomersindicatepreferencefornewertenderrigsoverolderones.

Dayrates for tenderrigshavestrengthenedsince2010and now reported at aroundUSD124,000 per day onaverage.Furthermore,itisexpectedthatmoretenderrigswillberequiredtosatisfyfuturepotentialdemandandassubstitutestothephasingoutofoldrigs.

Jack-Up Drilling Rig Market

There are 476 jack-up rigs globally of which 421 arecontractedandtheremaining55eitherwarmstackedorcoldstacked.Historicalsupplyanddemanddynamicsforjack-uprigsisreportedtobetightwithutilizationaround90percentandutilizationfornewerandhigherqualityunitsremainingcloseto100%.

Demand isexpected to remainstableevidencedby theincreaseinnumberofopentenders,upwardpressureondayratesnowreportedataroundUSD160,000perdayonaverageandincreasedcontractdurationsworldwide.

Althoughcontinueddemandisexpectedoverthenextfewyears,on thesupply side themarket isexpected tobechallengingin2015and2016whenanestimated100newbuild jack-up rigs are scheduled for delivery withoutcontracts.Pressureondayratesareanticipatedbutwithmore impactonolder jack-uprigsasopposedtonewerones.AsiaPacific and theMiddleEast continue to bethe primary source of demand for high specificationjack-uprigsbutthemarketwilltaketimetoadjusttotheover-supply.

Newbuildsupplyisalsoexpectedtoattempttopartiallyreplaceolderrigs.Duringthenextdecade,morethan50percent of theglobal contracted fleet, or approximately200units,areexpectedtobecomelessmarketableandeventually even phased out. This attrition rate wasprevioulsynotedtobeslowbutisexpectedtoaccelerate.Therearepresently290jack-upsthatareover30yearsoldcomparedtocurrently138newbuildjack-upsunderconstruction.When this takes place, the demand andsupplydynamicsshouldcomebackintobalance.

Source: Strategic Offshore Research

However, given the recent weaknesses in oil prices,StrategicOffshoreResearch has posited inNovember2014 an alternative case involving potential delay orpostponementofprojectsanddemand.Intheiralternativescenario, demand growth is either flat-line followed byslowrecoveryoritwillexperienceashort,sharpdemandcontractionbeforeeventualrecovery.

The Offshore Drilling Market

Demand for drillingand related servicesare influencedbyanumberoffactors,includingthecurrentandexpectedprices of oil andgas, aswell as the level of activity inoilandgasexplorationandproduction.Drillingoperations(both exploration and production) are geographicallydispersedthroughouttheworld.

Tender Drilling Rig Market

In the tender rigmarket, there is a finite number ofclients and rigs.Drilling programs require amulti-wellplatform development and calmwaters thus reducingthegeographicaloperationsoftherigstoSouthEastAsiaandWestAfrica. Ten newbuild rigs have entered themarketsince2000andtheyhavemostlyreplacedolderrigs.Oilmajorshavecontinuedtoshowapreferencefornewerrigsduetotheirsuperiortechnicalcapabilitiesandoperationalefficiency.

North Sea Rest of the World

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017





b a c o n c o C o . , l t d .ferTIlIzer & WArehouse


ferTIlIzer And WArehousebAConCo Co., lTd.

BUSINESS REVIEW – FERTILIzER

Based in Vietnam approximately 70 kilometers fromHoChiMinhCity, Baconco’s primary operation is inthe agrochemical industry, providing agrochemicalproductsfordistributioninbothVietnamandoverseas.Thecompany’s agrochemicals products are sold under the“STORK” trademark which was established in 1939andhasbecomerenownedforhavingsuperiorqualityinbothdomesticandexportmarkets.

Baconco’s trademark, STORK, was registered in Vietnam in 2005.

In 2014,Baconco invested in a brandnewgranulationproductionlineadding100,000metrictonnesofcapacity,increasingtheline’stotalproductioncapacityto450,000metric tonnes,making it the largest single producer inonelocationinVietnam.Thisinvestmenthasbeenmadetomeetgrowingdemandfromcustomers.

Baconco commands a strong market share ofapproximately 25% in the premiumNPKmarket, andboasts the biggestNPKproduction facility inVietnam,generatingUSD110millioninannualturnover.Thecompanyseeks to run a very lean operation, with aminimalinventory of rawmaterials and finished goods andoperatingacash-onlypaymentpolicy.


Baconcodevelops,manufactures,marketsanddistributescompound fertilizers and single fertilizers (collectivelyreferred to as “Fertilizers”) through a state-of-the-artblending, granulation/compaction and bagging plant,

withatotalproductioncapacityofapproximately450,000metric tons per year. The company has a packagingcapacityofapproximately550,000metrictonsperyear.

Baconco provides bespoke services for its mostsignificantcustomers,providingover90distinctformulasandcustomized formulas. The company has continuouslymade a push to boost exports, which increased 8%year-on-year to 74,145 tonnes in 2014, establishinga strong reputation for its distinctive “STORK”brand inmarkets suchasAfrica,Taiwan,Korea,Cambodia andLaos.

Someofthemostpopularformulasarelistedbelow.

Fertilizers

NPK Compound Fertilizers

NPKcompoundfertilizersareBaconco’smainproducts.TheyaresoldbothinVietnamandoverseas,andaccountedfor95%ofBaconco’stotalsalesrevenuesasendof30September2014.

NPK compound fertilizers are composed of all threemain nutrients, namely, nitrogen (N), phosphate (P

2O

5)

whichprovidesphosphorus(P),andpotash(K2O)which

providespotassium(K)forplants.TheN-P-Kmixmayvaryaccordingtotheusagepurposeandeachcrop’sbiologicalneeds.Other Fertilizers

The other fertilizers segment includes single fertilizerswhichcontainasinglenutrient;andcompound fertilizercomposingofatleasttwonutrients.Thesefertilizersareusedduetotheflexibilitytheyofferenduserstomixasdesired.As end of 30September 2014, other fertilizerproductsaccountedfor0.2%oftotalsalesrevenues.

Nitrogen-based(N)fertilizersspeedupphotosynthesisandtheproductionofseeds.Phosphorus-based(P)fertilizershelps developing the plant’s stems and roots. Potash(K)infertilizerscreateandtransportnutrientstodevelopgrowing parts, improving fruit quality and increasingproteincontentstopreventinfection.


Raw Materials (ex. DAP, MOP, Urea, Ammonium Phosphate)

Finished Products (granular, compacted or bulk blended)

Bulk Blending

Steam Granulation Compaction

USP

Bio Stimulant

Other Agrochemical Products

Other agrochemical products include pesticideswhichBaconco outsources and repackages for sales underits trademark; aswell as foliar fertilizers.This groupofproducts accounted for 4.8%of Baconco’s total salesrevenuesasendof30September2014.

1) Pesticides

Pesticides are biochemical or chemically-synthesizedsubstancescreatedtodestroy,deterordiscouragepests.Themost commonpests are insects, plant pathogens,weeds andmicrobes that spread disease, damageagricultural products and reduce production. Baconcodistributes itspesticideproducts inVietnamonly,undertheSTORKtrademark.

2) Foliar

Foliar fertilizersare liquid fertilizerssprayedontoplantstobe consumed through leaveswhichabsorbnutrientsfasterthanthroughroots.FoliarofferssimilarnutrientstotheNPKcompoundfertilizer;forthisreasonfoliarfertilizersarecommonlyusedwithfruitsandvegetablesforhigherandbetterproductivity.

Diagram of Baconco Fertilizer Production Processes


I.Client&TargetCustomers,DistributionChannels

Clients

Baconco’sprimarycustomersaremillionsofVietnamesefarmers. Beyond Vietnam’s border, Baconco exportsproducts across Asia to the Philippines, Cambodia,Thailand, Indonesia,Korea,Taiwan,andalso toAfrica,reflecting the strong reputation its distinctive “STORK”brand has established in thesemarkets.At present, itexports fertilizers to 26 countries worldwide with aparticularlystrongcustomerbaseinAfrica.Due to the different business nature of domestic andinternationalmarkets,Baconco has different groups oftargetcustomersineachmarket.InVietnam,Baconco’sdirectandmajorcustomersarewholesalerswhodistributeproductstoretailersandendusers,withanemphasisonNPK compound fertilizers, single fertilizers, compoundfertilizers,foliarandpesticides.


In export markets, Baconco’s direct customers aretraders,withafocusonNPKcompoundfertilizers,singlefertilizers, compound fertilizers and foliar. In thesemarkets,BaconcoactsasamanufacturerandBaconcoproductsarenotsoldunderitsSTORKtrademark.

Distribution Channels

The company has a strong network, of more than300wholesalers,whodistributeBaconco’s products tomorethan5,000nationwideretailers,undertheSTORKtrademarkinVietnam,LaosPDRandCambodia.

For domestic markets, Baconco has sales teamsconsistingof49salespersonscoveringsalesareasdefinedby different crops.Meanwhile, Baconco’s internationalcustomersaretradingcompanieswhocontractBaconcotomanufacturefertilizers.Competition

CompetitionissignificantintheVietnammarketwithover500producers,manyofthemstate-owned.Thelargest,PetroVietnamhascompletedbuildingitsureaproductionfacilityinPhuMyindustrialpark.PreviousplansbyPetroVietnamtobuildanNPKfactoryinSouthVietnamhavebeendiscontinued.

TheNPK fertilizer segment,however, isa consolidatedmarketwhereover80%of themarketshare isheldbythe top five companies, namely Lam Thao FertilizerandChemical,BinhDienFertilizerCompany,SouthernFertilizerCompany, JapanVietnamFertilizerCompanyandBaconco.

Fertilizers inVietnam can be classified into three tiersbased on their quality as low-quality,medium-qualityand premium-quality.While Lam Thao Fertilizer andChemical, BinhDienFertilizerCompany andSouthernFertilizerCompanycontrolthelow-tomedium-endmarkets,JapanVietnamFertilizerCompany,BinhDienFertilizerCompany,Yara andBaconco compete in the high-endpremiumqualitysegment.Fertilizergradeisdeterminedby content purity and precision to its formula declaredonthepackaging.

II.Industry&Outlook

Industry Overview

BaconcooperatesinVietnam,andassuchitsbusinessperformance is correlated to the country’s economy,due to the country’s current relianceon theagriculturalsector.With70%ofitspopulationemployedinagriculture,Vietnamisnowtheworld’ssecondlargestexporterofriceandcoffee,andithasbecometheworld’slargestexporterofpepper.

Fertilizer consumption benefits from this success inbuilding a large agricultural market. Such a strongagriculture sector demands significant volumes offertilizer, with approximately ten million tonnes offertilizer being consumed per annum, a level thatindustry experts believe will remain stable, growingmodestlyforthenexttwotothreeyears.

According to the Ministry of Agriculture and RuralDevelopment, the Vietnam fertilizermarket remainedresilient,withtotaldemandreachingsevenmilliontonnesin 2014. The increased use of single fertilizer (directapplication) as opposed toNPK is dependent on rawmaterialprices.

Fertilizer Market

Global Fertilizer Market

AccordingtotheInternationalFertilizerAssociation(IFA),Asiaisthelargestconsumerofchemicalfertilizers.Asianmarketsaccountfor58.7%ofthetotalmarketshare,mostofwhichisconsumptionfromEastandSouthAsiawherethere are deficits of nitrogen, phosphate and potash.A totalof threemillionmetric tonnes, twomillionmetrictonnes and sevenmillionmetric tonnes, are thereforeconsumedrespectively.

According to the InternationalFertilizerAssociation, theglobal fertilizer industrywill continue to see an overallsurplusin2014,2015and2016duetoopeningsofnewfertilizerplants.However,Asiawillcontinuetoexperienceashortageofphosphateandpotashwhiletherewillbeasurplusofnitrogenfrom2015onwardsasnewnitrogenfertilizerplantswillstartrunningthatyear.

Vietnam’s Fertilizer Industry

According to InterControl, an independent researcherandauditorwhostudiesVietnam’sfertilizerindustry,thecountry has three harvest seasons, namely, winter,winter-spring and summer-autumn. Cultivation landremains stable at 7,600 hectares while productivity(metric ton per hectare) is gradually increasing 69%of cultivated lands are in southern Vietnam,makingtheregionthecountry’sbiggestfertilizermarket.Moreover,farmers in the South and their counterparts in theNorth have different patterns of fertilizer consumption.Southern farmers consider quality and efficiency offertilizerasmajorfactorswhenbuyingtheproductwhilethoseintheNorthtendtobemoreprice-conscious.Demand remains strong however. InterControl expectsVietnamto importapproximately450,000metric tonsofNPKcompoundfertilizersin2014.


InterControlbelievesthatthefertilizerindustryinVietnam

will not be affected by adverse economic conditions,

andexpects fertilizermanufacturers to continue to see

their businesses thrive.Moreover, the opening of new

plants producing urea and phosphate which are raw

materials in theproductionofNPKcompound fertilizers

willaddasurplusofnitrogenandphosphatenutrientsfor

Vietnam.Ineffect,thiswillbenefitNPKcompoundfertilizer

producers as rawmaterialswill become cheaper. As

aresult,manufacturingcostsshouldseepositivedownward

movement. Theopeningofnewplantsproducingurea

andphosphatewilloutputasurplusofrawmaterialssuch

as nitrogenandphosphates, used in the production of

NPK compound fertilizers, and thiswill put downward

pressureonthecostofrawmaterials.

The graphic below details (1) actual production

volumes(inmetrictons)and(2)marketshares(%)oftheNPKcompoundfertilizerinVietnam.

13%

26%

19%

13%

11%

9%

22% LamThao

BinhDien

SFC

JVF

Baconco

Others

Source: Fertilizer Market Overview 2013, InterControl

1,000,000

2,000,000

3,000,000

4,000,000

2002 2005 2006 2007 2008 2009 2010 2011 2012

-25%

+10%

+3%

2013 2014 2015 2016 2017

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

-

Total fertilizer Total NPK

Chart: Vietnam Fertilizer Consumption (2002-2017)

Source: Baconco

BUSINESS REVIEW : WAREHOUSES

Baconco’sportoperationwascreatedthroughSoleado’s

acquisitionofa20%stakeinBariaJointStockCompany

ofServiceforImportandExportofAgroForestryProducts

andFertilisers(“BariaSerece”)fromYaraAsiaPte.Ltd.in

2010.BariaSereceownsandoperatesPhuMyport in

SouthVietnam,situatedontheThiVaiRiver,approximately

17miles from theopenseaand isadjacent toPhuMy

industrialpark,70kilometresfromHoChiMinhCity.The

portisVietnam’slargestdrycargodeep-waterport,andis

abletoreceiveuptosevenmilliontonnesofagricultural

products,coal,andfertilizerperyear.

ThePhuMyindustrialParkisoneofVietnam’skeyexport

centres in the South. The industrial estate therefore

benefits fromdemand for storage andwarehousing of

goodspriortoshipping.

TTA’s vision to create a fully integrated professional

logisticsserviceproviderinSouthernVietnamwasfurther

realizedduringtheyear.Our2013investmentsinBaconco,

Thoresen-Vinama Logistics, andBaria Serece, which

added53,000squaremetres,bringingcapacitytoalmost

190,000metrictonnes,meantweentered2014uniquely

positionedtoofferafullrangeoflogisticssolutionincluding

seaandlandtransport,warehousing,bagging,forwarding,

andcustomsclearance.This investmentpaiddividends

withsignificantgrowthinourwarehousebusinessin2014.


Today,Baconco’s storage facilities are of international

standardsandbuilt for longtermusewithfloorstrength

capableofsupportingupto10metrictonnespersquare

metre. The facilities are highly flexible and can be

segmented to different sizes to suit each individual

customers’uniquerequirements.Thereisalsoasuiteof

value-added services such as offices for clients’

supervisors, parking facilities for trucks, security guard

services and other infrastructure-based services

(electricity,waterandventilationsystems).

• BaconcoI(“BCCI”)andBaconcoIII(“BCCIII”)areusedby the fertilizer business for storage of rawmaterials,

finishedproducts,partsandotherstoragerequirements

foritsagrochemicalbusinesswhileredundantareasmay

beleasedtotenantsonashort-termbasis.

• Baconco V (“BCC V”) was built specifically forwarehousingleasingwhere75%oftheleasesarelong-term

contracts(2+years)andtheremaining25%isleasedout

onashort-termbasis.

(600)(500)

(200)

(250)

(300)

(450)


WhileBaconcoitselfisrestricted,duetoaregulationon

foreign investment, fromconductinganyretailcustomer

activity, the company signed an agreement in 2010 to

lease space to Thoresen-VinamaAgenciesCo., Ltd.

(“TVA”),aholderofalogisticsbusinesslicensewhocan

alsoleasewarehousingspacetoretailersunderVietnam’srelevantlawsandregulationssubjecttopricingandotherconditions.

Clients

Itswarehouse clients aremade up of its own fertilizerwholesalers, bottlers, rawmaterial importers and steelpipemanufacturers.

Competition

Warehouses residing outside of the strategic locationsinwhichBaconco’s facilitiesare located tend todeliverlowerstandards.

Thereisverystrongdemandforprofessionalwarehousesand logistics services within the PhuMy industrialzone,whereBaconco’swarehouses are located. Thisdemand will only grow as additional factories andportscontinuetobebuiltinthearea.

B: Marketing & Competition

IndustryReview

The industrialmarket in Vietnam is divided into threekey economic zones, the Northern Key EconomicRegion (“NKER”), theCentral Key EconomicRegion(“CKER”) and the Southern Key Economic Region(“SKER”),with the greatest concentration of industrialparks found in the latter.Thereare ten industrial parksinthevicinityofBariaandPhuMyPortalone.

Vietnam’s port systems are going through significantupgrading, particularly those that are state-owned butinfrastructureremainsabarrierforyardsandwarehousingsystemstoaccommodatebothcontainersandbulkcargos.

Warehouse development and availability, as well asprofessional logisticsmanagement, are expected to bekey factors in supportingVietnam’s port infrastructureandindustrialsector.





u n i q u e m i n i n g s e r v i c e s p u b l i c C o m p a n y l i m i t e d

CoAl loGIsTICs


CoAl loGIsTICsunIque mInInG servICes publIC CompAnY lImITed

BUSINESS REVIEW

UMSprovidesend-to-endand just-in-timecoal logisticssales anddistribution services inThailand. It owns twocoalscreeningfacilitiesinSamutSakornandAyudhayarespectively and 12 barges, which are used to servethe increasing local coal demand of small andmedium-sized industrial clients that use coal-firedboilers.

Thejust-in-timesupplymodelmeansthatUMSmanagesacoalsupplychainincludingstockpilemanagementandstorage,ensuringcoalsupplysecurityforitscustomers.Therefore, customers’ lead time for ordering is onlyone day in advanceon averageandmost importantly,customersare not required tomanage their own stockpilesandstorage.

2014 has continued to be challenging forUMS. TheCompanyhasbeenfocusingonsellingdownits0-5mmcoal inventories to rebalance its capital structurewhile limiting the production of classified coals due tooperational inefficiencies in its Suan Som facilitieswhichhavearisenfromtheprohibitionofcoaltransportationinMaeKlongriver.

UMS’SamutSakorn operationwas shut down due toenvironmentalconcernsintheareaadjacenttoUMS’plantinJuly2011.Toresumeoperations,UMShasimprovedtheplant’sfacilitiesandwaste-watertreatmentsystemtomeet thegovernment’s preconditions for reopening theplant.Followingthesemovesandothers,UMSwasallowedtoresumeoperationsat itsSamutSakornplant inJune2013, albeitwithout full logistics efficiency.Meanwhile,UMShassuccessfullypelletizedcoaltosolvelong-termproblemsrelatedto0-5mmcoal.TodaythepelletizationcapacityofUMS’plantis3.3tonnesperhour.UMSplanstoacquiremorepellet-makingmachinestoincreasecoalpelletproduction.Itisexpectedthattheplantwillproduceupto6.6tonnesperhourwithinthenearfuture.ByAugust2014theplantinAyutthayahadsuccessfullydoubled itsmachinecapacity, increasing theproductionlinefrom100tonnesperhourto200tonnesperhour.Itsupportsupto35,000tonnesofcoalpermonth,importedfromabroad.

Furtherexpansionwassought througha jointoperationcontractsignedinJuly,betweenUMSandTrimextoimportcoal for domestic customers. The first shipment wasimportedinSeptember2014.

Atthesametime,UMSwillcontinuetofocusonregainingaccess to its Samut Sakorn port and is exploring anentryintointernationalcoaltrading.


UMS imports only Sub-Bituminous and BituminouscoalsintoThailand.

Coal is a natural fuel in solid state primarily composedofCarbon.Ingeneral,coalappearsinbrownorblackandcanbeclassifiedintoseveraltypes.Thedegreeofchangeundergonebyacoalasitmaturesfrompeattoanthraciteisknownascoalification.Coalificationhasanimportantbearingoncoal’sphysicalandchemicalpropertiesandisreferredtoasthe‘rank’ofthecoal.Rankingisdeterminedbythedegreeoftransformationoftheoriginalplantmaterialto carbon. The ranks of coals, from those with theleast carbon to thosewith themost carbon, are lignite,sub-bituminous,bituminousandanthracite.

UMS focusesonSub-BituminousandBituminouscoalsas thesearegoodqualitywithmoderatecalorificvalue,suitable levels of ash andmoisture, and low sulphurcontent,comparedwithfuel-oil(fuel-oilhasasulfurcontentofabout0.1-3.0percent)whichmeanstheygeneratelessairpollution.

UMS imports coals according to spot orders of largecustomerssincethecostofBituminouscoalisexpensive.UMS does not import Anthracite due to its high cost.Lignite is also notwidely used in Thailand as it is thelowestrankinqualityandhashighsulphurcontent,whichmayaffectthequalityoftheenvironment.


B: Marketing & Competition

I.Clients&TargetCustomer,DistributionChannels Clients

UMS’ core clients typically use low calorific value coal(sub-bituminouswithheatingvalue4,000-4,200kcal/kgatgross,asreceived),whichitsecuresfromnolessthantenreputablesuppliersinIndonesia.UMSsellscoaltoclientsinseveraldomesticindustries,includingpulpandpaper,textile,foodprocessing,andcement.

UMS’ coal import andproduction strategies havebeenadapted tomatch the engineering specifications of theboilersusedbyeachtypeofindustrialclientitserves.

Competition

Thailand’scoaldistributionbusinesshasapproximately20operators.Ofthese,approximatelyeightcompetedirectlywithUMSinthesmallandmediumsizedenterprise(“SME”)segment.UMShasamarketshareofalittleunder10%and isworking to regainmarket share back to reachpreviouslevelsofapproximately35%.

II.Industry&Outlook

The impacts of the global economic slow-downdo notappear to have had a noticeable effect on domesticcoal demand,which is expected to continue to trendupward. Global coal consumption is expected to riseby1.1%peryearuntil2035,accordingtoBP.Thisgrowthwillbe ledbynon-OECDcountries,whichareexpectedtogrowat1.6%.ChinaandIndiaareexpectedtodrive87%ofthisgrowth.

AccordingtotheOECD/IEA2013WorldEnergyOutlook,demand for coal is set to triple in theASEAN region,growingat 4.8%per year onaverage, over theperiod.Coalisexpectedtorepresenta28%shareofSouthEastAsia’senergymixin2035.

Lookingatthedomesticmarket.AlthoughcoaldemandinThailandhasbeenhistorically lowerthanmostSouthEastAsianandNorthAsiancountries,thecountry’scoaldemandforbothindustryandelectricitygenerationissettoincreasesignificantlyoverthenexttenyears,assuppliesofnaturalgasdecreaseintheGulfofThailand.Thailand’sprojected economic growth and energy demandswillthereforeincreasinglybemetbycoal.

Chart : ASEAN primary energy demand by source

Source: OECD/IEA World Energy Outlook 2013

350Mtoe

300

250

200

150

100

50

01980 1990 2000 2010 2020 2030

Oil Coal Gas BioenergyHydro NuclearOther renewables

According toOxfordBusinessGroup,coal isseenasapotentialreplacementforat leastsomeofThailand’soilandgasconsumption,withusageexpectedtoriseby4%peryeartoreach47milliontonnesofoilequivalent(“TOE”)by 2035 andmost of thiswill be consumed by powerstations,asdemandforelectricitycontinuestoincrease.WhilenaturalgasisstillfairlylimitedinThailand,oilpricesremain volatile, and bio-fuel supplies have proveninconsistent, there is a strong case for coal as anincreasinglyreliable,costeffective,andefficientsourceofenergy.

Thissaid,China’scoaldemandgrowthisexpectedtoslowandeventuallydeclineafter2030,drivenbyarebalancingof China’s economy toward services and domesticconsumption, improvements in efficiency andmorestringentenvironmentalcontrolsfromthegovernmentasitseekstocontrolpollution.India’sgrowthindemandwillcontinue togrowhoweveras itcontinues togo throughindustrialisation.

UMSseesapositiveoutlookforcoalpricesandwilllookto capitaliseon this cyclical upturn if it is able to beginoperatingnormallyacrossbothplants.However,thereisstillsomeuncertaintywhethertheSamutSakornplantcanresumenormalfunction.


Policies on Corporate Social Responsibility and Sustainability Development

Thoresen Thai Agencies Plc. (“TTA”), is committed to becoming the leading and most-trusted strategic investment holding company in Asia through the principles of good governance, care for the environment and surrounding communities, and genuine contributions to society. The company is determined to deliver positive experiences to all internal and external stakeholders – including shareholders, employees, business partners, customers, and the broader communities, and society as a whole – and to achieving sustainable business development by positively impacting the economy, society, and the environment.

CSR & SUSTAINABILITy dEVELOPmENT POLICIES


Related Activities in 2014



TTA’s ApproACh To susTAInAble busIness developmenT

SustainableDevelopmentfortheEconomy

TTA’s ultimate goal is to create sustainable value forshareholders, business partners, employees, andall stakeholders in a balancedmanner. Returns oninvestment deliver common benefits for all parties asweforgeaheadasone,onthepathtosustainablegrowth.

Maintaining a balanced investment portfolio that contributes to business growth

We aim to drive an investment strategy that focuseson the creation of a balanced portfolio and achievingsustainable development for every investment. Thiscanbeachievedthroughthoroughanalysisofoperationalstrengthsandweaknesses,appropriateriskmanagement,and creation of added value and optimal benefits forallstakeholdersinaconsistent,stablemanner.

Seeking out investment opportunities in new businesses in accordance with the circumstances

Weseekoutinvestmentopportunitiesinnewbusinessesthat present high potential for revenue generation andrapid returns.Adopting an agile strategy and ensuringreadinessforchangeanduncertainty,wedevelopcarefulandconsideredinvestmentplans,particularlyintheareasof financial and risk management, with the goal ofenhancingthecompany’sfinancialstrengthandstability.

To achieve sustainable development, TTA has developed a management framework based on internationally-accepted principles. This framework addresses economic, social, and environmental aspects of good governance, providing the entire organization with common guidelines and goals to work towards.

Activitypicture;Trainingon“ConnectedTransaction”



TTA’s ApproACh To susTAInAble busIness developmenT

Developing human resources to foster an innovative organization

Wedevelop employees and foster a corporate culturecenteredoninnovation.Wedothisbycreatingaworkingenvironment in which all employees are encouragedto thinkoutside thebox, to voice their opinions, and tolisten to the perspectives of others. We activelyengageinlearningandself-development,andsupportingdevelopmentinitiativesthatbenefitstakeholders.

SustainableDevelopmentfortheEnvironment

Werecognizethatsomeofourportfoliocompaniesrelyonnatural resources.Theorganization thereforeconsidersefficient use of natural resources to be a key priorityandwe consistently strive tominimize environmentalimpact throughadvanced technologiesandeco-friendlyoperatingprocedures.Additionally,employeesareurgedtobemindfuloftheenvironmentalimpactoftheirwork.

SustainableDevelopmentforSociety

We support society-focused initiatives, develop humancapabilitiesandtrytoimprovethequalityoflifeofpeopleinthecommunitieswithinwhichweoperate.

Internally,theCompanyconsidersitsemployeestobethemostvaluableandimportantasset.Weseektodevelopemployees’ expertise in their respective lines ofworkwhilealsoencouragingthemtotakepartinactivitiesthatbenefit communities, society, and the environment.Throughtheseregularactivities,thecompanyisabletoexpandthescopeofitsdevelopmenttoaddresscommunityandsocialneeds.

Corporate Social Responsibility Policies for Sustainable Business Development

TTAholdstheviewthatabusinesscanonlyadvanceandgrowinasustainablemannerifitiscapableofdevelopingboth itsowncapabilitiesandmeeting its responsibilitiesfor society and the environment. Every person in theorganization is expected to recognize the value andimportanceoftheiractionsandtotangiblyconsidertheirsocialresponsibilityinalignmentwiththecompany’svisionandmission.Regardless of business or country, TTAstrives to work with integrity and in compliance withlawsandregulations.

Tobuildconfidenceamongstakeholders,TTAhasoutlineditscorporatesocialresponsibilitypoliciesforsustainablebusiness development in linewith generally acceptedCorporateSocialResponsibilityDevelopmentGuidelinesasfollows:

1.GoodGovernance

TheCorporateGovernanceCommittee reviewed theCompany’s Corporate Governance Policy, whichwasapprovedbytheBoardofDirectorson24December2012,andreiteratedTTA’scorporategovernanceprinciplesasfollows:

• Rules of law Management and operations shall beconductedinlinewithrelevantlaws,charters,regulationsandboardresolutions.• Accountability Allconcernedpartiesmustbeawareoftheirdutiesandresponsibilities.• Transparency Businessactivitiesandoperationsshallbeauditableandtransparent.• Participation Shareholdersandstakeholders’rightstoparticipateincompanyactivitiesshallberecognized.• Value for money All investments and resourceutilizationmustmeet targeted financial and economicreturns.

Themain components of TTA’s corporate governancepolicyaresetinaccordancewiththeguidelinesoftheStockExchangeofThailandandareasfollows:

1.Rightsandequitabletreatmentofshareholders2.Rightsofstakeholders3.Informationdisclosureandtransparency4.StructureandresponsibilitiesoftheBoardofDirectors5.Businessethicsandcodeofconduct

Detailsofthecompany’soperationsundertheseprinciplescanbefoundinthe“CorporateGovernanceReport”sectionofthisannualreport.

Activitypicture;Retellafabletochildren



2.FairBusinessPractices

1.Operate and invest under strongmoral principles –ensuring transparency, comply with agreed terms,anddistributebenefitsfairlyforallinvolved.

2.Support fair trade practices in the procurementprocess to prevent collusion. Business partnersmustbefairlycompensated,andallagreedpayments–includ-inginterestsanddebts–mustbepaidinatimelymannerasagreedbyallparties.

3.Encourage directors, executives, and employees torealizetheimportanceofthefightagainstcorruption.


• Atrainingsessiononthecodeofbusinessconductandwhistleblowingguidelines.• Atrainingsessiontofosteremployees’understandingoftheauthorizationpolicyandconnectedtransactions–e.g.transactionsbetweenthecompanyanditssubsidiariesorassociatedcompanies.

3.HumanRightsandFairLaborPractices

1.Supportandrespecthumanrights.Businessesthatthecompanyinvestsinarebarredfromviolationsofhumanrights–e.g.unfairlaborpracticesoruseofchildlabor.

2.Promoteenvironmentalprotection,andhealthandsafetyintheworkplace,includingelementssuchasanti-pollutionmeasures andprovision of safeworkingareas that areprotectedfromdisastersandhealthrisks.

3.Develop the skills and capabilities of employees,providingthemwithopportunitiestolearnandgrowintheircareers.

4.Offerfairemploymenttermsforemployeesandprovideappropriatecompensation.

5.Respectemployees’righttoexpresstheiropinionsandensuretheyreceiveinformationorlearnofothers’opinionsthroughpublicrelationsmaterialsandwebsites,andaccesstoopinionsorcommentsfromstakeholdersthroughvariouscommunicationchannels.

6.Encourageemployeestoachieveawork-lifebalance,providingthemwithopportunitiestomakecontributionstosocietyandengageinthepracticesoftheirchosenreligion.

7.Set-up aWelfareCommittee to provide advice andsuggestionsonemployeewelfare.

8.Setupacomplaintchannel foremployeeswhohavebeenunfairlytreated.

9. Set upOHSC (Occupational, Health and SafetyCommittee) to ensure that employees areworking insafe environments, and employees are required toreport inappropriate safety conditions atwork to theirsuperiors along with any suggestions to remedy thesituation.

10.Takeappropriatecareofemployeebenefits,suchasannualholidays,maternityleave,vacationdays,overtimepay,medical expenses, provident fund, life insurance,personalhealthinsurance,andannualhealthcheck-up.


Human Resources Development

• HumanresourcesstafftookpartinapersonalfinancialmanagementtrainingprogramheldbytheStockExchangeof Thailand to subsequently pass on their knowledgeto other employees, allowing everyone to realize theimportanceofplanningtheirfinancesandsavings.• “Townhall” activitiesare regularly heldonaquarterlybasistoinformemployeesofcompany’sfinancialresultsanddirections–sotheycanadjusttheirworkperformanceunderthegivencircumstances.• Employeesweregivenupdatesoninvestmentsthroughtheprovidentfund,keepingthemwellinformedofthefund’sinvestment policy andhelpingensure theyare capableofchoosingtherightinvestmentsforthemselves.

Quality of Life and Pleasant Workplace

• Freeannualhealthcheck-upswereprovidedalongwithseminarsonhealthandhowtoavoidofficesyndromes.• Specialbenefitsforemployeehappiness-e.g.quarterlymovieday forallemployeesunder theTTAumbrella inThailand.• Internalactivitieswereheld foremployees in theTTAgrouptobridgegapsandestablishpositiverelations–e.g.NewYearactivitiesandSportsDay.• Employeeswereencouragedtostayhealthywithregularexercisethroughaerobicdanceandyogasessions,whichweremadeavailabletwiceaweekandfeatureprofessionaltrainers.

Educational Support

• ThoresenShippingorganizedthe10thMaritimeAwardstoaward14scholarshipsofTHB5,000tochildrenofthecompany’s ship crews in recognition of their academicexcellence.CrewTopPerformanceAwardswere alsogivenouttofurtherraisemoraleamonghigh-performingcrewmembers.• Thoresen Shipping awarded four scholarships ofTHB 25,000 to students of Kasetsart University andBuraphaUniversity that had achievedGPAs of 3.0 orhigher.



Health, Hygiene, and Safety at Work

• Annual firedrillandcall treeperformanceevaluationswereconductedtohelpemployeeslearnthedosanddon’tsincaseofafireandensuresafety.

4.Responsibility toShareholders andBusinessPartners

1.Investinavarietyofdifferentbusinessestomaintainabalancedportfolioandspreadrisk.Identifyandinvestinbusinessesthatcreateaddedvalueandstablerevenuestreams, resulting in sustainable, consistent short-andlong-termreturns.

2.Nurtureallbusinessventurestogrowandsucceedinasustainablemanner.

3.Makeanadequateamountofoperatingandfinancialdataavailable toshareholdersandbusinesspartners inanaccurateandtransparentmanneronwebsites,annualreports,andotherpubliclyavailablematerials.

4. Allow general shareholders to voice their opinionsthroughthewebsiteorduringAnnualGeneralMeetings.


• HeldAnnualGeneralMeetings• HostedQuarterlySETOpportunityDayevents• ProvidedreportsonbusinessinvestmentsandvariousmovementstotheStockExchangeofThailandaswellasonthecompany’swebsite• Publishedanannualreport• Offered shareholders an opportunity to submitsuggestions or complaints regarding the company’soperationsordirectionsviathecompanywebsiteorPObox• Organized analystmeetings on a quarterly basis, aswellasontheoccasionofanewbusinessinvestment,tofoster understanding and confidence in the company’smanagementanddirection.

5.CommunityandSocialDevelopment

1. Regularlysupportactivities thatcontribute tosociety.Thecompanysetsasidepartof its incomeasabudgetforCorporateSocialResponsibility (CSR) programs –focusingespeciallyoncommunityandsocialdevelopment.

2. Encourage employees to take good care of theenvironment,communitiesandsocietyasawholeandtodedicatetimetoactivitiesforpublicbenefitorcharitablecauses.


Religious Support

• Participated in “Be BuddhawajanaWorld 2014” – aprogramorganizedbytheBuddhawajanaGlobalPromotionFund tospread the teachings of Buddha to peoplearoundtheworld.TTAmadeadonationofTHB200,000totheprogram.

Illness and Disaster Relief

• Worked with the Stock Exchange of Thailand toprovideTHB200,000infinancialaidtovictimsofTyphoonHaiyaninthePhilippines.• Took part in the “Ice Bucket Challenge” campaignandmade donationsworth THB100,000 in total,witheach half of THB 50,000 going to the Foundation fortheWelfare of theMentallyHandicapped of ThailandandtheFundforALSPatients.

Public Service

Continued to organize activities under the “Born toBeGood” program, which was initiated in 2013 to offeremployees opportunities to do good deeds and bringhappinesstothoseinneed.In2014,threeactivitieswereheldunderthisprogram:

• Employees donated books andmoney to theMirrorFoundationinsupportof its“ReadforThailand”project,whichproceededtogivebookshelvesto30communitiesinneed.• Employees volunteered to donatemoney, food, andmedicalsuppliesfordogsandcatsresidingattheHomeforAnimalsFoundation.• VolunteersfromthecompanyalsovisitedBaanKruNoitoretellafabletitled“TheUnusualWolf”tochildren,in-spiringthemtoseethevalueofreading.Childrenalsogottotakepartinarelayraceactivitydesignedtopromotetheimportanceofpersonalsavingsbeforeenjoyinglunchandscholarshipdonations.

6.EnvironmentalCare

1. Encourage employees across all departments andcompaniestobemindfuloftheenvironmental impactoftheirwork.

2. Promotetheconceptofreducing,reusing,andrecyclingitems– e.g. printing on both sides of the paper, usingelectronic documents insteadof paper, reusing variousmaterials,andmore.

3.Implementenergy-savingmeasuresintheworkplace–e.g.useofenergy-efficient lighting, turningoff lightsandairconditioningunitswhennotinuse,duringbreaks,oroutsideofworkinghours.



4.Implement policies across the entire TTA group ofcompaniestoencourageactiveeffortsincombatingglobalwarming throughmeasures designed to curtail thegreenhouseeffect.


As an example, ThoresenShipping has implementedseveralmeasurestofightagainstthegreenhouseeffectandreducethecompany’simpactontheatmosphereandmarineecosystems:

• Full compliancewithMARPOLAnnex VI regulationthrough the use of low-sulfur fuel to power every shipinthefleetwhileoperatinginregulatedwatersworldwide.Full support is provided to ensuremaximumefficiencyinenergyconsumptionandreductionsincarbondioxideandnitrogenoxideemissions.• Fullcompliancewithenergyefficiencyandemissionlevelguidelines as defined by the International MaritimeOrganization.• Full compliance with regulations on water ballasttreatment topreservemarineecosystemsandminimizethespreadofhazardouslifeformsintheballastwaterintoecosystemsaroundtheworld.

7.CSRInnovationInitiatives

The company is investing in business ventures in theshippingindustry,whichbyitsnatureposesriskstotheenvironment–includingpotentialissuessuchasenergyconsumption, air pollution, and damage to marineecosystems.Thecompany is fully supportingThoresenShipping’ssearchforsolutionsthatmitigateenvironmentalimpactandencouragefleetcrewstoreduceenergyusageat sea.Additionally, carbondioxide andnitrogenoxideemissions are to be kept at aminimum,whilemarineecosystems must be kept naturally balanced andsustainablyprotected.

Thoresen Shipping sees environmental andmarineecosystem protection as a top priority. In addition tocompliancewithMARPOLAnnexVIandIMOregulations,the company has introduced new innovations in itsoperationsforthispurpose.


Measures to reduce pollution and greenhouse gas emissions

• Usedlow-sulfurfuelandspecialfueladditivetoenhancecombustionefficiency.• RetrofittedAlpha Lubricator retrofit to reducewastedlubricationoil,plusinstallationofMewisDuctstoincreaseefficiencyofthemainpropulsionofthedieselengineandreducefueloilconsumption.

Energy preservation measures

• Installedsoftwaretoolstoaccuratelycalculateaship’swaterlineinaccordancewithdepthlevelsineachoperatingarea,resultinginmoreefficientuseofenginepower.• Increasedhullandpropellercleaning.• Initiatedfullblastingandhighslippaintsystemtrial.• ConductedSkySailfeasibilitystudytohelppropelships• Continuedtorunshipsinenergy-efficientmode.• AppliedTin-Freebaseantifoulingpainttothevessel’shullduringdrydocking.

These new innovations represent the company’sdedicationtosocialresponsibility,andtheirusehasbeencommunicatedtostakeholdersthroughvariousdirectandindirect channels – including the company’s website,annual report, public relations materials to ensurewidespreadawareness.

8. Corporate Social ResponsibilityReport

Throughout the years, the company has supportedand promoted clear policies on social responsibility,enablingexecutivesandemployeesaliketogainadeeperunderstanding of its importance. Information on thecompany’scontributionstosocietyandtheenvironmentisalsomadeavailableonaregularbasisthroughinternalmediaaswellastheofficialcompanywebsite.



fInAnCIAl hIGhlIGhTs

Year Ended 30 September2014 2013

Restated2012**

(Baht in millions, except share, per share data, and ratios)Income Statement Data:Voyagerevenues 6,887.49 4,746.61 3,528.46Voyageexpenses* 4,543.36 3,250.20 1,778.90Vesseloperatingexpenses-ownerexpenses* 1,072.70 864.30 829.50Offshoreservicesrevenues 10,088.18 8,243.40 5,721.17Offshoreservicesexpenses 7,494.80 5,989.00 3,751.88Sales 4,201.60 5,140.74 6,781.51Costofsales* 3,324.86 4,561.94 6,021.35Revenuesfromservicecompaniesandothersources* 353.63 440.62 478.07Depreciationandamortisation 1,534.26 1,595.21 1,556.35Generalandadministrativeexpenses* 2,057.88 1,864.51 1,522.55Interestexpenses 475.76 487.47 567.88Interestincome 55.37 38.38 67.11Equityincomefromassociatesandjointventures 1,186.09 254.66 129.43Foreignexchangegains 181.47 71.20 63.94Net income (losses) 1,015.23 (5,119.06) (4,494.43)Per Share Data:

Netincome(losses)-basic 0.88 (5.91) (6.35)Cashdividendsdeclared 0.00 0.00 0.00Netbookvalue 24.43 25.65 33.75Balance Sheet Data (at end of year):Cashandshort-terminvestments 7,632.30 7,961.59 4,392.34Vessels,rigs,machinery,andequipment-netofdepreciation 22,840.47 18,997.00 20,216.05Totalassets 49,330.73 43,297.81 40,797.23Totalliabilities 17,731.34 17,856.29 16,904.16Issuedandpaid-upsharecapital 1,293,234,815 991,837,961 708,004,413Totalshareholders’equity 31,599.38 25,441.52 23,893.07Other Financial Data:Netcashflowsprovidedby(usedin)operatingactivities 2,582.63 1,142.99 1,968.96Netcashflowsprovidedby(usedin)investingactivities (7,477.25) (2,671.71) (1,605.57)

Netcashflowsprovidedby(usedin)financingactivities 3,852.97 5,405.63 (676.58)Capitalexpenditures:Property,plantandequipment,andintangibleassets 6,958.03 2,411.73 1,689.19Financial Ratios:Returnonshareholders’equity(%) 4.85% -27.82% -21.16%Returnontotalassets(%) 2.19% -12.17% -10.32%Netprofitmargin(%) 4.74% -27.73% -27.49%Totaldebttototalcapitalisation 0.30 0.36 0.37Netdebttototalnetcapitalisation 0.16 0.19 0.29Note : * : Exclude one-off items ** : Financial highlights for the year 2012 is the restated figures which presented in the 2013 financial statements.

fINANCIAL hIghLIghTS


mAnAGemenT dIsCussIon And AnAlYsIs

ThoresenThaiAgenciesPublicCompanyLimited(“TTA”)reports 12-month normalized net profits of Baht 1,028millionfortheperiodended30September2014(“FY14”),increased507%yoyfromBaht(253)millionnetlossfortheperiodended30September2014(“FY13”).

Income statement restated

Baht millions FY13 FY14 %yoy

Revenues 18,463 21,431 16%

Costs (14,548) (16,548) 14%

Gross profits 3,915 4,883 25%

Equityincome 255 1,186 366%

Otherincome 147 155 6%

SG&A (2,121) (2,354) 11%

EBITDA 2,196 3,870 76%

Depreciation&Amortisation (1,595) (1,534) 4%

Financecosts (510) (492) -3%

EBT 91 1,844 1918%

Incometaxes (235) (314) 34%

Non-recurringitems (4,843) (86) 98%

Forextranslation 71 181 155%

Net profit (4,916) 1,625 133%

Net profits (losses) attributable to

-Non-controllinginterest 203 610 200%

- Owner of the Company (5,119) 1,015 120%

Breakdown of Net Profit to Onwer of the Company

Impairmentchargesandwrite-offs

(4,866) (13) 100%

Normalised Net Profits (253) 1,028 507%

Netprofits (5,119) 1,015 120%

No.ofshares(million) 992 1,293

BasicEPS(Baht) (5.16) 0.79

Executive Summary

Performance Overview

TTA ended FY14 with the best net profits in 5 years. Key business units, namely Mermaid Maritime, Thoresen Shipping, and Baconco delivered solid performance while net loss in UMS narrowed with significant improvement in capital structure. Thoresen Shipping: Ending year with Baht 355 million net profits, compared to Baht (277) million net loss excluding one-off item in FY13. Thedrybulkshipping market showed signs of recovery sinceSeptember2013.ThoresenShippingcontinuedtooperatewith advantage cost structure and outperformed themarketontherevenuesideby5%intermofTimeCharterEquivalent(“TCE”).

Mermaid Maritime: Net profit FY14 surged 165% yoy to stand at a record-high of Baht 832 million.Significantperformance improvements were attributable to bothsubsea and drilling divisionmainly from secured high-margin long-term contracts. Equity income, generatedmainlyfromthedrillingservicescontractwithSaudiArabianOilCompany(“SaudiAramco”)forall3jack-uprigsunderits33.8%-ownedassociate,AsiaOffshoreDrilling(“AOD”)increaseddrasticallyby687%yoy.

UMS: Net loss reduced 64% yoy to Baht (120) million with financial status strengthened. Financial statusimprovedsignificantlyduetotheplantoselldowncoalfineinventory to readjust capital structure.Net bank debtreducedtoBaht537millionfromBaht1,250millionattheendofFY13.

Baconco: Continued to make new record performance with net profit of Baht 345 million, up 36% yoy. Solidperformance in fertilizer businesswith highermargindue to ability tomaintain selling price despite decliningrawmaterial cost. The proportion of exportmarket vsdomestic market in term of revenue expanded to31:69.Warehouserentalrevenuesup69%yoyfollowinga 100% capacity utilisation,more rental spaces, andincrementalrentalfee.

mANAgEmENT dISCUSSION ANd ANALySIS


Transport Energy Infrastructure

Thoresen Shipping Mermaid Maritime UMS Baconco

Baht millions FY13* FY14 FY13* FY14 FY13* FY14 FY13* FY14

Revenues 4,747 6,887 8,243 10,088 1,931 1,038 3,229 3,192

EBITDA 495 1,150 1,520 2,495 19 23 365 457

EBITDAmargins 10% 17% 18% 25% s1% 2% 11% 14%

Net profits (4,194) 355 539 1,459 (378) (136) 253 345

Netprofitmargins -88% 5% 7% 14% -20% -13% 8% 11%

Net profits to TTA (4,194) 355 314 832 (335) (120) 253 345

Outperform industry in revenue

and cost.

Solid performance from high-margin

long-term contracts.

Rebalance capital structure and

excessive inventories.

Solid sale volumewith improved profit margins.

Consolidated Performance Summary

Consolidated revenues increased 16% yoy to record at Baht 21,431 million. Higher revenuesatThoresenShipping(+45%yoy)andMermaidMaritime(+22%yoy),and stable revenues atBaconco (-1% yoy)more thanoffsetlowersalesatUMS(-46%yoy).ThoresenShippingacquired and chartered-inmore vessels, coupledwithrecoveryindrybulkshippingindustry,resultinginhighervessel days and stronger freight revenues.MermaidMaritimesawmorecontributionsfromitsthedivingservicescontractwithSaudiAramcoandotherclientsaswellasmorechartered-inactivitiestoserveclients.

Gross profits increased 25% yoy to Baht 4,883 million. BettergrossmarginwaswitnessedatThoresenShipping,Baconco,andUMS.ThoresenShipping’smarginimproved from fleet expansion, sustained cost controlefforts, andmore charter-in activities to accommodategrowing commercial relationships. Baconco’s fertilizerbusinessdeliveredhighersalesvolumesandsustainedhighsellingpricedespitecostofrawmaterialsreduced.UMShadmuchbettercostofsalesinFY14.Meanwhile,MermaidMaritimehadstablemargin.

EBITDA &

Net Profits

* Restated

Equity income increased 366% yoy to Baht 1,186 milliondueprimarilytoanincreaseinprofitsharingfromMermaidMaritime’sinvestmentinAOD.AODgeneratedBaht 1,005million of equity income, up fromBaht 135millionlastyear.

As a result, FY14 EBITDA increased 76% yoy to record at Baht 3,870 million, from Baht 2,196 million in FY13. Consolidated normalized net profits were recorded at Baht 1,028 million, up 507% yoy, compared with net losses of Baht (253) million the same period last year.Ifincludingnon-cashaccountingadjustment,theFY14netprofitswereBaht1,015million,comparedtonetlossesofBaht(5,119)millioninFY13,inwhichassetimpairmentsofBaht4,866millionwererecorded.

Of note, FY13’s net losses were restated due to the adoption of TFRS No. 12 (Deferred Tax). The adoption of this accounting standard caused FY13’s net losses to increase by Baht 39 million.

FY13* FY14 FY13* FY14

1,150

1,520(4,194)

539

1,434

FY13* FY14

23

(378)

(136)

FY13* FY14

253

345

495 355 2,495

19

365

457



Performance Overview by Business GroupRevenue contribution by business line restated


Transport 4,812 6,902 43%

Infrastructure 5,408 4,441 -18%

Energy 8,243 10,088 22%

Corporate* - -

Total revenues 18,463 21,431 16%

Net profit contribution by business line restated


Transport (4,042) 511 113%

Infrastructure (55) 208 477%

Energy 292 817 180%

Corporate* (1,314) (521) 60%

Net profits (5,119) 1,015 120%* Corporate = TTA, the holding company, and inter-company eliminations

Key Ratiosrestated

Profitability ratios FY13 FY14 %yoy

Grossmargin 21% 23% 2%

EBITDAmargin 12% 18% 6%

Netmargin -28% 5% 32%

Summary of Statement of Cash Flowsrestated


Cashflowsfromoperatingactivities 1,143 2,583 126%

Cashflowsfrominvestingactivities (2,672) (7,477) -180%

Cashflowsfromfinancingactivities 5,406 3,853 -29%

Netincreaseincashandcashequivalentsduringtheperiod 3,877 (1,041) -127%

Currencytranslationdifferences (13) (119) -815%

Cashandcashequivalentsatthebeginningoftheperiod 3,582 7,446 108%

Cashandcashequivalentsattheendoftheperiod 7,446 6,286 -16%

Thoresen Shipping

Highlilghts

Market continued on uptrend despitetemporaryratevolatilities

In FY14, dry bulk shippingmarket showed signs ofrecovery since late 2013despite some volatility duringthe year. Themarket was driven by Chinese importdevelopmentasChineseironore,coal,andgrainimportssoaredtorecord-highlevelsinlate2013andearly2014but slowed sinceApril 2014. The slower trade growth

pushedfleetutilizationdownfrom88%inlate2013/early2014tolessthan87%inApril–September2014,(Marsoft,November2014).TherewereseveraltemporarydisruptionsincludingironoreexportsfromBrazildeclined,grainexportsfromSouthAmerica delayed, Indonesia’s nickels andbauxiteexportban,ongoingcredit issues inChina,andMonsoon duringMay-June in India.However, industryfundamentalsremainhealthyinmediumtolong-runbackedbytheexpectedstrongdemandgrowthwithminimalglobalfleetgrowth.



Despitetheslipinfreightratesince3QFY14,theaverageBalticDryIndex(“BDI”)forFY14wasat1,284points,up30%yoy.ThelargestincreasewasseenintheSupramaxsegmentwithanaverageof1,038points, increasedby25%yoy.TheBalticSupramaxTCrates(“BSI”)averagedUSD10,852perdaycomparingwithUSD8,715perdayinFY13.FollowingbytheBalticCapesizeTCrate(“BCI”)roseby22%yoytoaverageUSD2,228perdayandtheBalticPanamaxTCrates(“BPI”)increasedby20%yoytoaverage USD 1,145 per day. The Baltic HandysizeTCratesaveragedatUSD8,388perday,up16%yoy.

According to the latest report fromMarsoft (November2014),drybulktradevolumesareexpectedtoslowduetothe slowdown in iron ore trade, mine expansion,steel products trade, and grain trade, but rising coaltrade.Overall, the tonne-miles demand for bulkers isexpectedtoslowoverthenextfewyears,aftergrowingby an average of 6.1%per year in 2014 and 5.2% in2015, the slowdown is due to the iron ore trade andslowergrowthinthesteelproductstrade,whilethecoaltrades should do better.Meanwhile, the fleet growthis projected to expandby5.1% in 2014, bottomingoutat 4.2% in 2015, and picked up again to an averageof 5.2% in 2016 - 2018. Supramax spot rates areanticipated toaverageatUSD10,500perday in2015,andUSD11,500perdayfrom2016-2018.

Global fleet growth

Global ton mile demand growth

0%

-5%2009

-1.7%

6.2%

14.9% 15.3%

12.6%

6.5%5.1% 4.2%

11.8%

7.4%

6.0%6.4% 6.1% 5.2%

2010 2011 2012 2013 2014e 2015e

5%

10%

15%

20%

Source: Marsoft, November 2014

ThoresenShippingcontinuedtooutperformthemarket fromeffective revenueandcostmanagement

ThoresenShipping’sFY14freightrevenuesofBaht6,887million,up45%yoy,mainlyduetohigheroperatingdayandmoreownedvesselsaswellaschartered-inactivity.DuringFY14,ThoresenShippingoperatedanaverageof38.0vessels(20.0ownedvesselsand18.0chartered-invessels),upfromanaverageof29.2vessels(16.1ownedvesselsand13.1chartered-invessels)inFY13.

ThoresenShipping’scombinedTCEwasUSD9,887perdayinFY14,18%yoyimprovementfromUSD8,364perday in FY13. In comparison to the Supramaxmarket(“BSI”), which is ThoresenShipping’s benchmark, byadjusting for the fleet’s revenue capacity (91%ofBSI),ThoresenShipping’sTCEoutperformed theBSIby5%during FY14. The chartered-in TCE improved fromUSD152perdayinthepreviousyeartoUSD576perdayinFY14.

Thoresen Shipping continued to operate with costadvantages.Owner’s expenses, the largest portion ofcashoperatingexpenses,wereatUSD3,921per day,reduced by 4% yoy and significantly well below theindustryaverageofUSD5,121perday(basedonMoore

4,747

FY13 FY14

(4,194)

335

6,8878,000

6,000

4,000

2,000

0

-2,000

-4,000

-6,000

Freight revenues Net profits

FY13 FY14

2,000

4,000

6,000

8,000

10,000

12,000

0

Cash OPEX Depreciation Thoresen’s TCE

Cash OPEX Includes:- Owner’s expenses - Dry-docking expenses- Administrative expenses

USD/day

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

USD/day

0

500

1,000

1,500

2,000

2,500

BDI & TC rates

Jul-13

Oct-

13

Jan-1

4

Apr-

14

Jul-14

BDI (LHS) TC Avg BCI TC Avg BSI TC Avg BHSI

4QFY14

1QFY14

2QFY14

3QFY14

4QFY14

Source: Marsoft



Stephens 2013).Dry docking expenses declined 18%yoytoUSD611perdayduetoourfleetreconfigurationstrategy and diligent on-boardmaintenance.Generaland administrative expenses of USD 1,285 per day,decreased 22% yoy. The total per-day costs stood atUSD8,077perdayinFY14,down18%yoy.

Asaresult,ThoresenShippingreportedEBITDAofBaht1,150million,up132%yoy.ThoresenShippingreportednetprofitsofBaht355million,up228%yoyfromnetlossesofBaht(277)million,whichexcludedBaht3,917millionnon-cashimpairmentagainstitsfleetinFY13.

Thoresen Shipping’s income statement* restated

Baht millions FY13 FY14 %yoy Total revenues 4,747 6,887 45%Totalcosts (4,115) (5,616) 36%Gross profits 632 1,271 101% Grossmargins(%) 13% 18% 5%Otherincomes 158 183 16%SG&A (295) (304) 3%EBITDA 495 1,150 132% EBITDAmargins(%) 10% 17% 13%Net profits (4,194) 355 108% Netprofitmargins(%) -88% 5% 94%

*asconsolidatedonTTA’sP&L

Average Daily Operating Results (USD/Day)USD/Day FY13 FY14 %yoyUSD/THBRate(DailyAverage) 30.46 32.23 6%Time charter equivalent (TCE Rate)* $8,364 $9,887 18% TCERateofOwnedFleet $8,212 $9,311 13% TCERateofChartered-In $152 $576 279%Vesseloperatingexpenses(Owner’sexpenses) $4,087 $3,921 -4%Dry-dockingexpenses $744 $611 -18%Generalandadministrativeexpenses $1,647 $1,285 -22%Cash costs $6,478 $5,817 -10%Financecosts,net -$217 -$67 -69%Depreciation $3,563 $2,327 -35%Total costs $9,824 $8,077 -18%

*TCErateincludedmarginfromcharteringinactivities

Fleet data summary

4Q FY13 3QFY14 4QFY14 %yoy %qoq FY13 FY14 %yoyAverageDWT 48,902 50,401 50,636 4% 0% 48,902 50,636 4%Calendardaysforownedfleet(1) 1,606 1,904 2,201 37% 16% 6,032 7,495 24%Availableservicedaysforownedfleet(2) 1,550 1,840 2,173 40% 18% 5,874 7,344 25%Operatingdaysforownedfleet(3) 1,549 1,822 2,146 39% 18% 5,864 7,288 24%Ownedfleetutilisation(4) 99.9% 99.0% 98.8% -1% -0% 99.8% 99.2% -1%Voyagedaysforchartered-infleet 1,318 1,688 1,655 26% -2% 4,797 6,596 38%Averagenumberofvessels(5) 31.2 38.8 41.8 34% 8% 29.2 38.0 30%

Avg DWT-LHS

Avg # of vessels (owned fleet)-RHS

Avg age (years)-RHS

00

10,000

Owned fleet

20,000

30,000

19.2

26,401

50,63640.5

23.6

11.0

40,000

50,000

60,000

5

10

15

20

25

30

35

40

45

50

1Q F

Y09

3Q F

Y09

1Q F

Y11

3Q F

Y11

1Q F

Y12

3Q F

Y12

1Q F

Y13

3Q F

Y13

1Q F

Y14

3Q F

Y14

1Q F

Y10

3Q F

Y10

Note:(1) CalendardaysarethetotalcalendardaysTTAownedthevesselsin

ourfleetfortherelevantperiod,includingoffhiredaysassociatedwithmajorrepairs,drydockings,orspecialorintermediatesurveys.

(2)Availableservicedaysarecalendardays(1)lessplannedoffhiredaysassociatedwithmajorrepairs,drydockings,orspecialorintermediatesurveys.

(3)Operatingdaysaretheavailabledays(2)lessunplannedoff-hiredays,whichoccurredduringtheservicevoyage.

(4)Fleetutilisationisthepercentageoftimethatourvesselsgeneratedrevenuesand isdeterminedbydividingoperatingdaysbyavailableservicedaysfortherelevantperiod.

(5)Averagenumberofvesselsisthenumberofvesselsthatconstitutedour fleet for therelevantperiod,asmeasuredby the totaloperatingdaysforownedfleetplusvoyagedaysforcharteredinfleetduringtheperioddividedbythenumberofcalendardaysintherelevantperiod.



24ownedSupramax&Handymaxfleetreadytooperateforprofit

DuringFY14,ThoresenShippingtookdeliveryofsixsecond-handSupramaxdrybulkvessels,JapaneseBuilt,detailsofwhichareasfollows;

Name of Vessel Delivery Date Year BuiltPrice (million)

USD THB

1.M.V.ThorMercury 20-Jan-14 2005 19 639

2.M.V.ThorMagnhild 19-Feb-14 2006 22 730

3.M.V.ThorMaximus 23-May-14 2005 23 7504.M.V.ThorMenelaus 3-Jun-14 2006 24 7925.M.V.ThorMadoc 13-Jun-14 2005 23 752

6.M.V.ThorMonadic 7-Jul-14 2006 22 708

AttheendofFY14,ThoresenShipping’sownedfleetconsistsof24vessels(8Handymaxand16Supramax)withaDWT-weightedaverageageof11.0yearsandaveragesizeof50,636DWT.Tosupportdemand fromcustomers,ThoresenShippingalsochartered-intotalledequivalentto18.0vesselsinFY14.

Mermaid Maritime

Highlights

Bestyearever

TheconsolidatednetprofitfromMermaidMaritimetotalledBaht832million,upfromBaht314millioninFY13or165%yoy.Thisisattributedtosoliddemandforsubseavesselsandrelatedservicesdrivenbysteadyoilandgasoffshoreproduction and exploration activities. Additionally, thedemand-supplydynamicsofthetenderrigmarketappearsto remain favourableas indicatedby industryday ratesandutilization,andtheoveralldemandforjack-updrillingrigshasimprovedglobally.

Improvedutilizationanddayratesfromhigh-margin long-term contracts inSubseaandDrilling

Total revenue of Baht 10,088 million, up 22% yoyprimarilyduetohighercontributionsfromsubseabusinessasmorefullservicecontracts,suchastheSaudiAramcodiving services contract, led to higher average dayrates of 31% yoy. The average subsea own vesselsutilizationratewas66%inFY14,similartoFY13.MermaidMaritime also chartered-inmore vessels in FY14 toservecustomersresultingtohigherincome.

1Q

55%

81%

51%

66% 66%64%

78% 80%

2Q 3Q 4Q

FY13 FY14

*Utilization rate per calendar days

*Utilization rate per calendar days

Subsea vessel utilization*

Drilling rig utilization*

Revenue from drilling businesswas drivenmainly byMTR-2, operating at 98% average utilization rate.TheMTR-2 is currently on 2-year drilling contract inIndonesia withChevron. However, the unit has beenworkingaswork-overunitwithChevronsince3QFY14ata reduced rateona limited timeuntilChevron receivespermit required by Indonesia government.MTR-2 isexpected to resume its normal drilling and recoveritsoriginaldayratesoonandtocontinueworkingtowardtheendof thecontractat theendof2015.Meanwhile,MTR-1hasbeenunemployedsincetheaccommodationbargeservicecontractendedinJuly2013.

Equity incomesurged fromBaht128million inFY13 toBaht1,010millioninFY14duetocontributionfromMermaidMaritime’s33.8%-ownedassociatecompanyAsiaOffshoreDrilling (“AOD”).AOD’s threehigh-specification jack-uprigshavecommencedtheirthree-yearcontractswithSaudiAramcosince4QFY13.Grossprofit increased15%yoybutgrossmarginswasdownslightlyto26%comparedwith27%inFY13resultingfromoneofsubseavesselswasstandbysince3QFY14,whileSG&Aroseby28%yoytoBaht1,131millionduetoincreased personnel in theMiddleEast region. All in,EBITDAincreasedby64%yoytoBaht2,495million.

1Q

76.2%73.9% 76.4%

78.8%

27%

20%

39.8%

58%

2Q 3Q 4Q

FY13 FY14



Mermaid’s income statement*


Total revenues 8,243 10,088 22%

Totalcosts (5,989) (7,495) 25%

Gross profits 2,254 2,593 15%

Grossmargins(%) 27% 26% -6%

Equityincomes 128 1,010 687%

Otherincomes 23 23 2%

SG&A (885) (1,131) 28%

EBITDA 1,520 2,495 64%

EBITDAmargins(%) 18% 25% 34%

Net profits 539 1,459 171%

Netprofitmargins(%) 7% 14% 121%

Net profits to TTA 314 832 165%*as consolidated on TTA’s P&L

Newrigandvesselorders

InJanuary2014,MermaidMaritimeenteredintotheagreementstobuildtwonewtenderrigsandonenewDiveSupportVessel(“DSV”)withChinaMerchantsIndustryHoldingsCo.,Ltd.,detailsofwhichareasfollows;

New assets Price (USD million) Delivery schedule

Tenderrig–MTR3 149 1QFY16

Tenderrig–MTR4 149 2QFY16

DSV 138 3QFY16

Outlook remains optimistic: Currentdeclining oil price no effect on E&Pspending

Althoughglobaloilpriceshaveexperiencedweaknessesrecently, Mermaid Maritime continues to observecontinuing requirement for its assets and services.MermaidMaritime operates in shallow water fieldswhich ismoredefensiveand lessaffecteddue to lowerbreak-even costs by oil and gasmajors as comparedtodeeperwater projects.MermaidMaritimealsohasapresenceincabotageandrestrictedmarketsthusmakingit a beneficiary of local expansion. Furthermore, thesubsea and drilling assets are all deployed in theproductionphaseoftheoilandgasvaluechainwhichisless exposed to capital expenditure constraints, withdemandsofarobservedtoberelativelyintact.

Subseacontractscontinuetobegenerallyshort-termandremainsubjecttochangesinclientrequirementsonshortnotice.MermaidMaritimewill continue its product andgeographicalexpansionplanswithfocusontheSouthEastAsian andMiddleEastmarketswhich enjoys strongerdemand.Most of subsea assets are expected to begainfullyemploymentin2015basedonexistingcontractbacklogwithtenderingactivityalsoappearingtoremainstable.MermaidMaritimehadalsorecentlychartered-inanumberofadditionalsubseavesselstosupportexistingandpotentialworkrequirementsandhadplacedanorderfor onenewbuild dive construction and support vesselscheduledfordeliveryin2016.

Thetenderrigmarket isanichemarketwitharound30unitsglobally,includingthoseunderconstruction.Locatedpredominantly inSouthEastAsia andWestAfrica, thedemand-supply dynamics of the tender rig marketappeartoremainfavourablewithcustomerscontinuingtoshowpreferencefornewerrigs.MermaidMaritime’stenderrig drilling fleet is expected to enter a transition phasewitholderrigssuchasthe‘MTR-1’and‘MTR-2’seekingcontinuedemploymentuntil theendof theiruseful livesand the new build rigs ‘MTR-3’ and ‘MTR-4’ underconstruction pursuing long-term contract opportunities.Duringthistime,theinvestmentinAsiaOffshoreDrilling,withthreehighspecificationjack-updrillingrigs,isexpectedtocontinuetoperformitsdrillingcontractsintheMiddleEastthroughto2016.

Overall,MermaidMaritimecontinuestoobservethatthelong-termfundamentalsintheoilandgasindustryremainstrongandwilldriveongoinggrowthinthesegmentsthatMermaidMaritimeoperatesin.Theyear-on-yearearningsgrowthsignifiesaproventrackrecord that theMermaidMaritimeplanstobuildfurtheronin2015.Tomaintain its competitive position,MermaidMaritimecontinues to focus on optimizing performance andmaximizing cost efficiencies in its business whilstalso seekingopportunistic growth in order tomaximizeshareholderreturns.



UMS

Highlights

Nowreadytoresumenormaloperations

After threequartersof rebalancingcapitalstructureandexcessiveinventories,nowUMSisreadytoresumenormaloperations.UMSreportednetlossesofBaht(120)million,reducedfromBaht(335)millioninFY13.Thecashflowpositionandfinancialstatussignificantlyimprovedresultingfromtheinventoryreadjustmentplan.

In FY14, UMSmanagement had been focusing onsellingdownits0-5mmcoalinventoriesandlimitingtheproduction of classified coals to rebalance its capitalstructure.UMSsoldapproximately511,100tonnesofcoalinFY14,down35%from791,100tonnesofcoalinFY13.Theproportionoflow-margin0-5mmcoalinUMS’stotalsalesvolumewasaccountedfor60%comparingwith27%inFY13.Grossmarginimprovedto24%duetolowercostofsales.

Improvecashandcapitalstructurestatus;NetbankdebtreducedtoBaht537million

Thesaleof0-5mmcoalinventories,althoughcreatedanetloss,generatedsignificantcashflowwhichenableUMSto rebalance itscapitalstructureandregain its financialstrengths,whichareaprerequisite foran furtherbusinessimprovement.UMS’snetbankdebtreducedfromBaht1,250millionattheendofFY13toBaht537millionattheendofFY14.

UMS’ income statement* restated


Total revenues 1,931 1,038 -46%

Totalcosts (1,581) (785) 50%

Gross profits 350 253 -28%

Grossmargins(%) 18% 24% 34%

Otherincomes 5 3 -39%

SG&A (336) (233) 31%

EBITDA 19 23 22%


Net profits (378) (136) 64%

Netprofitmargins(%) -20% -13% 33%

Net profits to TTA (335) (120) 64%

*as consolidated on TTA’s P&L

306580

206

211

18% 24%

Coal: Other sizes

Coal: 0-5mm

Gross margins

FY130

200

400

600

800

1,000Thousand Tonnes

10%

40%

70%

Volume

Gross Margins

FY14



Baconco

Highlights

Continuedtomakenewrecordperformance

BaconcomadeanothernewrecordhighofBaht345millionnetprofits,up36%yoyfromFY13,drivenbysolidfertilizersalevolumeinVietnamandexportmarketwithimproveprofitabilitymargins.RevenuesofBaht3,192millionweredownonly1%yoyonlowerfertiliserpriceswhiletotalcostsreduced7%yoyfromdecliningrawmaterialprices.Grossmargin increased to 20% in FY14 from15% in FY13.EBITDAincreased25%yoytorecordatBaht457millioninFY14,withEBITDAmarginsof14%,up from11%inFY13,despite61%yoyincreaseinSG&A.

196 206

15%20%

Sales volume Gross margins

FY130

50

100

150

200

10%

0%

20%

30%

Gross Margins

FY14

Thousand TonnesVolume

SolidperformanceinbothFertilizerandWarehousebusinesses

1) Fertilizer business Baconcosold201,800tonnesinFY14,up3%yoy.NPKfertilizermadeup99%oftotalvolumesoldinFY14,similartothatofFY13.However,revenuesweredownslightlyonlowerfertilizerprices.Baconcofocuseditssalesonhighmarginformulaandanewgranularproductionunitwasaddedin3QFY14toboostitsproductioncapacitybyabout100,000metrictonnestototal450,000metrictonnes.NewproductionlineforexportmarketsstartedoperationsinAugust2014.ExportsalesvolumesinFY14totalled74,145metrictonnes,accountedfor37%oftotalsalesvolumes,generating31%oftotalfertilizerincome,rosefrom30%inFY13.Profitabilitymarginsincreasedasaresultofefficientcostmanagementandeffectivesalesandmarketingplans.

Baconco’s income statement* restated


Total revenues 3,229 3,192 -1%

Totalcosts (2,759) (2,559) -7%

Gross profits 470 633 35%

Grossmargins(%) 15% 20% 36%

Otherincomes 24 31 26%

SG&A (129) (207) 61%

EBITDA 365 457 25%


Net profits 253 345 36%

Netprofitmargins(%) 8% 11% 38%*as consolidated on TTA’s P&L

2) Warehouse business

InFY14,warehouserentalrevenueswasBaht29millioncomparingwithBaht17millioninFY13,drivenbyfullyearoperationofBaconco5warehouseaswellasincrementalrentalfees.However,suchrevenueisstillaccountedfora fractionofBaconco’s top-line compared to fertilizers.Capacity utilization continued to be strongat 100%onaverageinFY14versus92%onaverageinFY13.Baconcocurrentlyoperatestotalwarehousespaceof31,000sq.m.,withcapacityforalmost124,000metrictonnesofcargoes.



PMTAlisting:Filingeffective.TolaunchtheIPOinbeginning2015.100%pre-emp-tiverighttoTTAshareholders

TheSECalreadyapprovedPMThoresenAsiaHoldingsPlc.,(“PMTA”)onfilingandsecuritiesofferinginNovember2014.Currently,theIPOpreparationprocessiscompletedandexpectedtolaunchtheIPOwith100%pre-emptiverighttoTTAshareholdersinthebeginningof2015.

Corporate

Highlights

Investmentin2014

Business entity Investment transactionValue

(Baht mn)

ThoresenShipping Acquired6Supramaxvessels 4,371

MermaidMaritime Ordered2tenderrigsand1DSV 14,052

Baconco Builtexportproductionline 125

TTA Purchased0.44%sharesofMermaidMaritime 60

TTA Acquiring9%inSinoGrandnessFoodIndustryGroupLimited 785

Financial Status

Assets totaledBaht49,331million, increased14%yoy.Non-currentassets increased14%yoy resultingmainlyfromanincreaseinland,buildingandequipmentfromBaht20,935milliontoBaht26,924millionasThoresenShippinginvestedinadditional6second-handSupramaxvesselsacquisitionin2014.InvestmentinassociatecompaniesalsoincreasedfromBaht3,732milliontoBaht4,861millionattributable to contribution fromAsiaOffshoreDrillingLimitedheldbyMermaidMaritime.

Total liabilities stood at Baht 17,731million, close tolastyearfigureofBaht17,856million.During2014,theCompany repaid long-term loans and finance leaseliabilitiesofBaht1,454million,anddrawndownlong-termloansfromfinancialinstitutionstotaledBaht1,525million.Reductionofnon-current liabilities in termofnetbondswasbecause the first trancheofThaiBahtBondswithnetbookvalueofBaht1,999millionwasreclassified tocurrent portion as of 30September 2014 based on itsmaturitydate.

Total equitywasBaht 31,599million, rose24%yoy, inwhichequityattributabletoownerofthecompanytotaledBaht 23,726million, increased31%yoy. In 2014,TTAincreased the authorized share capital by 411,299,416sharesresultingtothenewauthorizedsharecapitalofBaht1,544million.Additionally,theCompanyissuedandoffered

securities,including298,110,588newordinarysharesand99,370,196units ofwarrants to purchasenewordinaryshares of the CompanyNo. 4 (TTA-W4), to existingshareholdersinproportiontotheirshareholdingpercentage(RightOffering:RO),resultinginproceedsofBaht4,174million. During the year ended 30 September 2014,TTA-W3 and TTA-W4were exercised and registeredaspaid-upsharecapitalby3millionshareswithproceedsofBath57million.Capital Structure

MostofTTA’sliabilitieswerelong-termdebtstotalingBaht7,156million,increasedby8%yoy,duetoanincreaseoflong-termloansfromfinancialinstitutionstoacquireassets.Attheendofthefiscalyear2014,debttoequityratiostoodat0.43times,similartotheyearbeforeat0.45times.

Liquidity

CashflowfromoperatingactivitiesincreasedcomparedtolastyearduetotheCompanyintheyear2013recordedimpairmentandwrite-offonproperty,plantandequipmentamounting toBaht3,925million.While in recent years,therewasonlyBaht 15million recordedof impairmentcoupledwith significant improvement inperformanceofall business.While the changes in the cash flow frominvestment activities, coming from investment of the 6Supramaxvesselsintheshippingbusiness.



sTATemenT of The boArd of dIreCTors responsIbIlITIes for The fInAnCIAlsTATemenTs

26November2014

To:TheShareholdersofThoresenThaiAgenciesPublicCompanyLimited

TheBoardofDirectorsrealisesthesignificanceofitsdutiesandresponsibilitiesinsupervisingTTA’sbusinesstoensuregoodmanagementwithintegrityandprudenceinaccordancewithlaws,detailedobjectives,ArticlesofAssociation,andresolutionsof theshareholdersmeetings.TheBoardofDirectorsprotects thebenefitsof thecompanyand itsstakeholders by ensuring that TTA’s financial report contains accurate and full accounting records that reflect itsactualfinancialstatusandoperationalresults.

TheBoard ofDirectors has established theAuditCommittee comprising independent directors fully qualified inaccordancewiththerequirementsoftheStockExchangeofThailandtoreviewandensureaccuracyandsufficiencyofthe financial report, to review the internal control systems including compliancewith securities law, regulationsof the Stock Exchange of Thailand or laws relating to the business of the company. In this regard, the AuditCommitteehasalreadyreporteditsperformancetotheBoardofDirectors.

TheBoardofDirectorsisoftheopinionthatthefinancialstatementsfortheyear2014ofTTAanditssubsidiaries,whichhavebeen reviewedby theAuditCommittee in conjunctionwith themanagement, andauditedbyTTA’s auditor,accurately reflect the financial status andoperational results in allmaterial aspects in accordancewith generallyacceptedaccountingstandards.

Mr.PrasertBunsumpunChairman

Mr.ChalermchaiMahagitsiriPresident&ChiefExecutiveOfficer

STATEmENT Of ThE BOARd fOR ThE fINANCIAL STATEmENTS

ANNUAL REPORT 2014 083Consolidated and Company finanCial statementsANNUAL REPORT 2014

I n d e p e n d e n t A u d I t o r ’ s r e p o r t

Independent Auditor’s Report To the Shareholders of Thoresen Thai Agencies Public Company Limited I have audited the accompanying consolidated and separate financial statements of Thoresen Thai Agencies Public Company Limited and its subsidiaries (the “Group”) , and of Thoresen Thai Agencies Public Company Limited (the “Company”), respectively, which comprise the consolidated and separate statements of financial position as at 30 September 2014, the consolidated and separate statements of income, comprehensive income, changes in equity and cash flows for the year then ended, and note, comprising a summary of significant accounting policies and other explanatory information. Management’s Responsibility for the Consolidated and Separate Financial Statements Management is responsible for the preparation and fair presentation of these consolidated and separate financial statements in accordance with Thai Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated and separate financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility My responsibility is to express an opinion on these consolidated and separate financial statements based on my audit. I conducted my audit in accordance with Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated and separate financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

T H O R E S E N T H A I A G E N C I E S P L C084 Consolidated and Company finanCial statements

2

Opinion In my opinion, the consolidated and separate financial statements present fairly, in all material respects, the financial position of the Group and the Company, respectively, as at 30 September 2014 and their financial performance and cash flows for the year then ended in accordance with Thai Financial Reporting Standards. Emphasis of Matter Without qualifying my opinion, I draw attention to note 3 to the financial statements which describe the effect of the Group and the Company’s adoption from 1 October 2013 of certain new accounting policies. The corresponding figures presented for the consolidated and separate financial statements are based on the audited consolidated and separate financial statements as at and for the year ended 30 September 2013 after making the adjustments described in note 3. (Veerachai Ratanajaratkul) Certified Public Accountant Registration No. 4323 KPMG Phoomchai Audit Ltd. Bangkok 26 November 2014

ANNUAL REPORT 2014 085Consolidated and Company finanCial statements

Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of financial position

1 October 1 OctoberAssets Note 2014 2013 2012 2014 2013 2012

(restated) (restated) (restated) (restated)

(in thousand Baht)Current assets

Cash and cash equivalents 6 6,289,847 7,458,387 3,589,424 2,052,840 650,977 123,271

Short-term investments 7 1,342,450 503,207 802,920 66,393 60,207 88,618

Trade accounts receivable 5, 8 4,243,971 3,966,227 2,665,169 - - -

Other accounts receivable 9 428,153 841,457 426,494 12,799 3,035 2,301

Receivables from related parties 5 6,774 5,222 62,062 495,690 515,189 592,175

Short-term loans to related parties 5 - - - 2,083,753 4,732,061 4,030,978

Current portion of long-term

receivables from a related party - - 31,251 - - -

Current portion of long-term

loans to related parties 5 2,073 2,573 3,323 607,723 2,573 3,323

Deferred contract costs 10 203,385 261,202 277,459 - - -

Inventories 11 659,058 1,336,210 1,601,787 - - -

Vessel supplies and spare parts 696,790 419,736 610,583 - - -

Prepayments 195,651 182,394 139,484 4,591 5,933 6,040

Assets held for sale 12 149,416 - - - - -

Other current assets 368,125 378,352 306,671 2,377 516 764

Total current assets 14,585,693 15,354,967 10,516,627 5,326,166 5,970,491 4,847,470

Non-current assets

Long-term loans to related parties 5 - - - 734,876 2,232,763 1,911,820

Investments in subsidiaries 13 - - - 27,733,152 21,265,656 18,947,210

Investments in associates 14 4,861,412 3,732,203 2,599,551 42,368 42,368 42,368

Investments in joint ventures 15 1,110,618 1,306,463 1,256,472 17,968 19,781 19,984

Goodwill 16 978,620 968,661 1,478,996 - - -

Property, plant, and equipment 17 26,924,236 20,934,537 23,984,537 182,404 198,524 204,184

Intangible assets 18 246,558 316,428 497,506 53,396 69,577 90,739

Deferred tax assets 19 178,083 213,047 193,157 80,275 65,893 41,306

Other non-current assets 20 445,506 471,502 457,638 511 698 247

Total non-current assets 34,745,033 27,942,841 30,467,857 28,844,950 23,895,260 21,257,858

Total assets 49,330,726 43,297,808 40,984,484 34,171,116 29,865,751 26,105,328

Consolidated

financial statements

Separate


30 September 30 September

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

3

s t A t e m e n t o f f I n A n c I A l p o s I t I o nthoresen thAI AgencIes publIc compAny lImIted And Its subsIdIArIes




1 October 1 OctoberLiabilities and equity Note 2014 2013 2012 2014 2013 2012


(in thousand Baht)Current liabilities

Bank overdrafts 21 4,244 12,140 7,230 - - -

Short-term loans 21 284,044 1,168,349 1,263,004 - - -

Trade accounts payable 1,229,828 1,382,044 1,269,526 9,686 13,332 13,341

Other accounts payable 152,607 71,835 64,493 61 28 1,121

Payables to related parties 5 7,576 14,314 11,632 365,001 208,783 97,053

Advances from customers 171,248 166,686 225,776 - - -

Short-term loans from related parties 5,21 - - - 5,816,657 5,916,004 5,660,905

Current portion of long-term loans 21 2,272,635 2,279,612 3,318,265 360,000 220,000 40,000

Current portion of bonds 21 1,999,445 - - 1,999,445 - -

Current portion of finance lease liabilities 21 6,264 4,239 5,373 - - -

Current portion of share

subscription payable 66,047 34,408 33,792 - - -

Accrued income taxes 154,030 158,174 62,826 - - -

Accrued expenses 1,580,745 1,432,126 880,555 102,685 73,855 59,733

Other current liabilities 363,114 170,646 90,729 137,308 40,359 13,362

Total current liabilities 8,291,827 6,894,573 7,233,201 8,790,843 6,472,361 5,885,515

Non-current liabilities

Long-term loans 21 7,156,341 6,627,589 5,387,990 580,000 940,000 1,160,000

Bonds, net 21 1,998,569 3,996,772 3,995,530 1,998,569 3,996,772 3,995,530

Finance lease liabilities 21 9,186 9,604 11,193 - - -

Share subscription payable - 42,786 42,020 - - -

Deferred tax liabilities 19 163,757 176,325 133,914 - - -

Employee benefit obligations 22 111,663 108,640 100,473 12,343 11,121 20,371

Total non-current liabilities 9,439,516 10,961,716 9,671,120 2,590,912 4,947,893 5,175,901

Total liabilities 17,731,343 17,856,289 16,904,321 11,381,755 11,420,254 11,061,416

Consolidated


Separate




4







1 October 1 OctoberLiabilities and equity Note 2014 2013 2012 2014 2013 2012


(in thousand Baht)Equity

Share capital

Authorised share capital 23 1,544,106 1,132,807 783,004 1,544,106 1,132,807 783,004

Issued and paid-up share capital 1,293,235 991,838 708,004 1,293,235 991,838 708,004

Premium on ordinary shares 9,161,644 5,232,142 1,540,410 9,161,644 5,232,142 1,540,410

Retained earnings

Appropriated - legal reserves 24 98,830 93,500 93,500 98,830 93,500 93,500

Unappropriated 12,308,809 11,298,910 16,417,969 12,243,423 12,142,298 12,713,148

Other components of equity 863,262 507,048 140,594 (7,771) (14,281) (11,150)

Equity attributable to owners

of the Company 23,725,780 18,123,438 18,900,477 22,789,361 18,445,497 15,043,912

Non-controlling interests 7,873,603 7,318,081 5,179,686 - - -

Total equity 31,599,383 25,441,519 24,080,163 22,789,361 18,445,497 15,043,912

Total liabilities and equity 49,330,726 43,297,808 40,984,484 34,171,116 29,865,751 26,105,328

- - - - - -


Consolidated


Separate



5



s t A t e m e n t o f f I n A n c I A l p o s I t I o nthoresen thAI AgencIes publIc compAny lImIted And Its subsIdIArIesfor the years ended 30 september 2014 and 2013 (restated)

Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of income For the years ended 30 September 2014 and 2013 (restated)

Note 2014 2013 2014 2013

(restated) (restated)

Revenues

Revenues from services

Freight charges 6,887,489 4,746,612 - -

Offshore service income 10,088,183 8,243,401 - -

Service and commission income 253,963 332,336 - -

Revenues from sales 4,201,603 5,140,740 - -

Total revenues 26 21,431,238 18,463,089 - -

Costs

Cost of providing services

Vessel operating expenses 6,219,423 4,742,727 - -

Offshore service expenses 8,233,895 6,668,705 - -

Service and commission expenses 132,790 144,128 - -

Cost of sales 3,386,129 4,385,064 - -

Total costs 17,972,237 15,940,624 - -

Gross profits 3,459,001 2,522,465 - -

Other operating income 27 339,593 289,611 760,061 476,538

Profits before expenses 3,798,594 2,812,076 760,061 476,538

Selling expenses 315,222 280,705 - -

Administrative expenses 2,213,049 2,057,388 334,141 318,511

Impairment charges and write-offs 24,927 4,894,819 2,847 412,276

Total expenses 2,553,198 7,232,912 336,988 730,787

Operating profits (losses) 26 1,245,396 (4,420,836) 423,073 (254,249)

Share of profits in associates and joint ventures 14, 15 1,186,091 254,662 - -

Profits (losses) before finance costs

and income tax expenses 2,431,487 (4,166,174) 423,073 (254,249)

Finance costs 491,859 509,625 332,627 340,406

Profits (losses) before income tax expenses 1,939,628 (4,675,799) 90,446 (594,655)

Income tax expenses (benefits) 29 314,353 240,151 (16,009) (23,805)

Net profits (losses) for the year 1,625,275 (4,915,950) 106,455 (570,850)

Net profits (losses) attributable to:

Owners of the Company 1,015,229 (5,119,059) 106,455 (570,850)

Non-controlling interests 610,046 203,109 - -

1,625,275 (4,915,950) 106,455 (570,850)

Earnings (losses) per share

Basic earnings (losses) per share (in Baht) 30 0.88 (5.91) 0.09 (0.66)

Diluted earnings per share (in Baht) 0.85 - 0.09 -

(in thousand Baht)

Consolidated Separate

financial statements financial statements


6



s tAt e m e n t o f c o m p r e h e n s I v e I n c o m ethoresen thAI AgencIes publIc compAny lImIted And Its subsIdIArIesfor the years ended 30 september 2014 and 2013 (restated)

Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of comprehensive income

For the years ended 30 September 2014 and 2013 (restated)

2014 2013 2014 2013


Net profit (losses) for the year 1,625,275 (4,915,950) 106,455 (570,850)

Other comprehensive income (expenses)

Translation adjustments for investments

in subsidiaries 579,458 473,801 - -

Net change in fair value of available-for-sale

investments 8,137 (27,704) 8,137 (3,913)

Share-based payment reserves 462 462 - -

Income tax on other comprehensive income (1,627) 782 (1,627) 782

Other comprehensive income (expenses)

for the year 586,430 447,341 6,510 (3,131)

Total comprehensive income (expenses)

for the year 2,211,705 (4,468,609) 112,965 (573,981)

Total comprehensive income (expenses)

attributable to:

Owners of the Company 1,389,781 (4,752,605) 112,965 (573,981)

Non-controlling interests 821,924 283,996 - -

2,211,705 (4,468,609) 112,965 (573,981)

(in thousand Baht)




7


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Stat

emen

t of c

hang

es in

equ

ity

For t

he y

ear e

nded

30

Sept

embe

r 201

4 an

d 20

13 (r

esta

ted)

and

1 O

ctob

er 2

012

(rest

ated

)

Cons

olid

ated

fina

ncia

l sta

tem

ents

Oth

er c

ompo

nent

s of

equ

ity

Cap

ital

Tran

slatio

nFa

ir va

lue

rese

rves

-C

hang

e in

adju

stm

ents

chan

ge in

adju

stm

ent

pare

nt's

Shar

e-Eq

uity

Issu

ed a

ndPr

emiu

mR

etai

ned

earn

ings

for i

nves

tmen

tsav

aila

ble-

arisi

ng fr

omow

ners

hip

base

dTo

tal o

ther

attri

buta

ble

Non

-

paid

-up

shar

eon

ord

inar

yLe

gal

in o

vers

eas

for-s

ale

busin

ess

inte

rest

s in

paym

ent

com

pone

nts

to o

wne

rs o

fco

ntro

lling

Tota

l

Not

e c

apita

lsh

ares

rese

rves

Una

ppro

pria

ted

subs

idia

ries

inve

stm

ents

rest

ruct

urin

gsu

bsid

iarie

sre

serv

esof

equ

ityth

e C

ompa

nyin

tere

sts

equi

ty

(in th

ousa

nd B

aht)

Bala

nce

at 1

Oct

ober

201

2 - a

s re

porte

d70

8,00

4

1,54

0,41

0

93

,500

16,1

88,5

95

(2,2

99,5

12)

9,

853

(50,

030)

2,48

8,79

0

36

6

149,

467

18

,679

,976

5,21

3,09

2

23

,893

,068

Impa

ct o

f cha

nges

in a

ccou

ntin

g po

licie

s 3

(a)

--

-22

9,37

4

2,

205

2,78

8

-

(13,

866)

-

(8,8

73)

220,

501

(33,

406)

18

7,09

5

Bala

nce

at 1

Oct

ober

201

2 - r

esta

ted

708,

004

1,

540,

410

93,5

00

16

,417

,969

(2

,297

,307

)

12,6

41

(50,

030)

2,47

4,92

4

36

6

140,

594

18

,900

,477

5,17

9,68

6

24

,080

,163

Tran

sact

ions

with

ow

ners

, rec

orde

d di

rect

ly in

equ

ity

Cont

ribut

ions

by

owne

rs o

f the

Com

pany

Issu

e of

ord

inar

y sh

ares

23

283,

834

3,

691,

732

--

--

--

--

3,97

5,56

6

-3,

975,

566

Div

iden

ds p

aid

from

a s

ubsid

iary

to n

on-c

ontro

lling

inte

rest

s-

--

--

--

--

--

(9,2

16)

(9,2

16)

Con

tribu

tion

from

non

-con

trollin

g sh

areh

olde

rs o

f a s

ubsid

iary

-

--

--

--

--

--

1,86

3,61

5

1,

863,

615

Tota

l con

tribu

tions

by

owne

rs o

f the

Com

pany

283,

834

3,

691,

732

--

--

--

--

3,97

5,56

6

1,85

4,39

9

5,

829,

965

Com

preh

ensi

ve in

com

e (e

xpen

ses)

for t

he y

ear

Net

pro

fit (l

osse

s) fo

r the

yea

r-

--

(5,1

19,0

59)

-

--

--

-(5

,119

,059

)

203,

109

(4

,915

,950

)

Oth

er c

ompr

ehen

sive

inco

me

(exp

ense

s)

--

--

39

2,91

4

(26,

922)

-

-46

2

366,

454

36

6,45

4

80

,887

447,

341

Tota

l com

preh

ensi

ve in

com

e (e

xpen

ses)

for t

he y

ear

--

-(5

,119

,059

)

392,

914

(2

6,92

2)

--

462

36

6,45

4

(4,7

52,6

05)

28

3,99

6

(4,4

68,6

09)

Ba

lanc

e as

at 3

0 Se

ptem

ber

2013

991,

838

5,

232,

142

93,5

00

11

,298

,910

(1

,904

,393

)

(14,

281)

(5

0,03

0)

2,

474,

924

828

50

7,04

8

18,1

23,4

38

7,

318,

081

25,4

41,5

19

Bala

nce

at 1

Oct

ober

201

3 - a

s re

porte

d99

1,83

8

5,23

2,14

2

93

,500

11,1

08,3

77

(1,9

06,7

89)

(1

7,85

0)

(50,

030)

2,48

8,79

0

81

4

514,

935

17

,940

,792

7,35

9,98

1

25

,300

,773

Impa

ct o

f cha

nges

in a

ccou

ntin

g po

licie

s 3

(a)

--

-19

0,53

3

2,

396

3,56

9

-

(13,

866)

14

(7,8

87)

182,

646

(41,

900)

14

0,74

6

Bala

nce

at 1

Oct

ober

201

3 - r

esta

ted

991,

838

5,

232,

142

93,5

00

11

,298

,910

(1

,904

,393

)

(14,

281)

(5

0,03

0)

2,

474,

924

828

50

7,04

8

18,1

23,4

38

7,

318,

081

25,4

41,5

19

Tran

sact

ions

with

ow

ners

, rec

orde

d di

rect

ly in

equ

ity

Cont

ribut

ions

by

owne

rs o

f the

Com

pany

Issu

e of

ord

inar

y sh

ares

23

301,

397

3,

929,

502

--

--

--

--

4,23

0,89

9

-4,

230,

899

Div

iden

ds p

aid

from

a s

ubsid

iary

to n

on-c

ontro

lling

inte

rest

s-

--

--

--

--

--

(159

,361

)

(159

,361

)

Con

tribu

tion

from

non

-con

trollin

g sh

areh

olde

rs o

f a s

ubsi

diar

y -

--

--

--

--

--

4,11

8

4,

118

Dilu

tion

of n

on-c

ontro

lling

shar

ehol

ders

of a

sub

sidia

ry-

--

--

--

5,08

0

-

5,08

0

5,

080

(4

7,04

1)

(41,

961)

Cha

nge

in p

aren

t's o

wne

rshi

p in

tere

sts

in s

ubsid

iarie

s-

--

--

--

(23,

418)

-

(23,

418)

(2

3,41

8)

-

(23,

418)

Dec

onso

lidat

ion

of a

sub

sidia

ry-

--

--

--

--

--

(64,

118)

(6

4,11

8)

Tota

l con

tribu

tions

by

owne

rs o

f the

Com

pany

301,

397

3,

929,

502

--

--

-(1

8,33

8)

-(1

8,33

8)

4,21

2,56

1

(266

,402

)

3,94

6,15

9

Com

preh

ensi

ve in

com

e fo

r the

yea

r

Net

pro

fits

for t

he y

ear

--

-1,

015,

229

-

--

--

-1,

015,

229

61

0,04

6

1,62

5,27

5

Oth

er c

ompr

ehen

sive

inco

me

--

--

367,

580

6,

510

--

462

37

4,55

2

374,

552

211,

878

58

6,43

0

Tota

l com

preh

ensi

ve in

com

e fo

r the

yea

r-

--

1,01

5,22

9

367,

580

6,

510

--

462

37

4,55

2

1,38

9,78

1

821,

924

2,

211,

705

Tran

sfer

to le

gal r

eser

ves

24-

-5,

330

(5

,330

)

--

--

--

--

-Ba

lanc

e as

at 3

0 Se

ptem

ber 2

014

1,29

3,23

5

9,

161,

644

98,8

30

12

,308

,809

(1

,536

,813

)

(7,7

71)

(50,

030)

2,45

6,58

6

1,

290

863,

262

23

,725

,780

7,87

3,60

3

31

,599

,383

The

acco

mpa

nyin

g no

tes

are

an in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

8

st

At

em

en

t o

f c

hA

ng

es

In

eq

uIt

yth

or

esen

th

AI A

gen

cIe

s pu

blIc

co

mpA

ny

lIm

Ited

An

d It

s su

bsId

IAr

Ies

for t

he y

ear e

nded

30

sept

embe

r 201

4 an

d 20

13 (r

esta

ted)

and

1 o

ctob

er 2

012

(rest

ated

)

The

acc

ompa

nyin

g no

tes

are

an in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Stat

emen

t of c

hang

es in

equ

ity

For t

he y

ear e

nded

30

Sept

embe

r 201

4 an

d 20

13 (r

esta

ted)

and

1 O

ctob

er 2

012

(res

tate

d)

Issu

ed a

ndPr

emiu

mFa

ir va

lue

chan

ge in

Tota

l oth

erpa

id-u

p sh

are

on o

rdin

ary

Lega

lav

aila

ble-

for-s

ale

com

pone

nts

ofTo

tal

Not

e c

apita

lsh

ares

rese

rves

Una

ppro

pria

ted

inve

stm

ents

equi

tyeq

uity

Bal

ance

as

at 1

Oct

ober

201

2 - a

s re

porte

d70

8,00

4

1,

540,

410

93

,500

12

,674

,629

(13,

937)

(13,

937)

15

,002

,606

Impa

ct o

f cha

nges

in a

ccou

ntin

g po

licie

s 3(

a)-

--

38,5

19

2,

787

2,78

7

41

,306

Bal

ance

as

at 1

Oct

ober

201

2 - r

esta

ted

708,

004

1,54

0,41

0

93,5

00

12,7

13,1

48

(1

1,15

0)

(1

1,15

0)

15,0

43,9

12

Tran

sact

ions

with

ow

ners

, rec

orde

d di

rect

ly in

equ

ity

Con

tribu

tions

by

owne

rs o

f the

Com

pany

Issu

e of

ord

inar

y sh

ares

23

283,

834

3,69

1,73

2

--

--

3,97

5,56

6

Tota

l con

tribu

tions

by

owne

rs o

f the

Com

pany

283,

834

3,69

1,73

2

--

--

3,97

5,56

6

Com

preh

ensi

ve in

com

e (e

xpen

ses)

for t

he y

ear

Net

loss

es fo

r the

yea

r-

--

(570

,850

)

--

(570

,850

)

Oth

er c

ompr

ehen

sive

expe

nse

--

--

(3,1

31)

(3

,131

)

(3

,131

)

Tota

l com

preh

ensi

ve in

com

e (e

xpen

ses)

for t

he y

ear

--

-(5

70,8

50)

(3

,131

)

(3,1

31)

(573

,981

)

Bal

ance

as

at 3

0 Se

ptem

ber 2

013

991,

838

5,23

2,14

2

93,5

00

12,1

42,2

98

(1

4,28

1)

(1

4,28

1)

18,4

45,4

97

Bal

ance

as

at 1

Oct

ober

201

3 - a

s re

porte

d99

1,83

8

5,

232,

142

93

,500

12

,079

,974

(17,

850)

(17,

850)

18

,379

,604

Impa

ct o

f cha

nges

in a

ccou

ntin

g po

licie

s 3(

a)-

--

62,3

24

3,

569

3,56

9

65

,893

Bal

ance

as

at 1

Oct

ober

201

3 - r

esta

ted

991,

838

5,23

2,14

2

93,5

00

12,1

42,2

98

(1

4,28

1)

(1

4,28

1)

18,4

45,4

97

Tran

sact

ions

with

ow

ners

, rec

orde

d di

rect

ly in

equ

ity

Con

tribu

tions

by

owne

rs o

f the

Com

pany

Issu

e of

ord

inar

y sh

ares

23

301,

397

3,92

9,50

2

--

--

4,23

0,89

9

Tota

l con

tribu

tions

by

owne

rs o

f the

Com

pany

301,

397

3,92

9,50

2

--

--

4,23

0,89

9

Com

preh

ensi

ve in

com

e fo

r the

yea

r

Net

pro

fits

for t

he y

ear

--

-10

6,45

5

--

106,

455

Oth

er c

ompr

ehen

sive

inco

me

--

--

6,51

0

6,

510

6,51

0

Tota

l com

preh

ensi

ve in

com

e fo

r the

yea

r-

--

106,

455

6,

510

6,51

0

11

2,96

5

Tran

sfer

to le

gal r

eser

ves

24-

-5,

330

(5,3

30)

--

-B

alan

ce a

s at

30

Sept

embe

r 201

41,

293,

235

9,

161,

644

98

,830

12

,243

,423

(7,7

71)

(7

,771

)

22

,789

,361

Sepa

rate

fina

ncia

l sta

tem

ents Oth

er c

ompo

nent

s of

equ

ityR

etai

ned

earn

ings

(in th

ousa

nd B

aht)

The

acco

mpa

nyin

g no

tes

are

an in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.

9

st

At

em

en

t o

f c

hA

ng

es

In

eq

uIt

yth

or

esen

th

AI A

gen

cIe

s pu

blIc

co

mpA

ny

lIm

Ited

An

d It

s su

bsId

IAr

Ies

for t

he y

ear e

nded

30

sept

embe

r 201

4 an

d 20

13 (r

esta

ted)

and

1 o

ctob

er 2

012

(rest

ated

)

The

acc

ompa

nyin

g no

tes

are

an in

tegr

al p

art o

f the

se fi

nanc

ial s

tate

men

ts.


stAtement of cAsh flowsthoresen thAI AgencIes publIc compAny lImIted And Its subsIdIArIesfor the years ended 30 september 2014 and 2013 (restated)

Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of cash flows


Note 2014 2013 2014 2013


Cash flows from operating activities

Net profits (losses) for the year 1,625,275 (4,915,950) 106,455 (570,850)

Adjustments for:

Depreciation 17 1,443,406 1,484,461 17,491 27,567

Amortisation on deferred dry-docking expenses 17 324,877 270,221 - -

Amortisation on intangible assets 18 90,858 110,747 16,181 21,545

Amortisation on prepayments 3,611 3,432 - -

Bad and doubtful debts expense 8 9,967 83,785 - -

Reversal of allowance for doubtful accounts

and provision for unrecoverable value added tax (52,368) (108,818) - -

Impairment on short-term loans to related parties 28 - 10,123 - -

Impairment on long-term loans to related parties 28 - - 506,901 -

Allowance for (reversal of) impairment on inventories (289,168) 243,294 - -

Net (reversal of) impairment on investments in subsidiaries 28 - - (505,867) 412,276

Impairment on investments in an associate and a joint venture 28 - 120,245 1,813 -

Impairment on goodwill 28 - 516,031 - -

Impairment and write-off on property, plant, and equipment 15,017 3,925,266 - -

Impairment on intangible assets - 79,839 - -

Finance costs 491,859 509,625 332,627 340,406

Income tax expenses (benefits) 314,353 240,151 (16,009) (23,805)

Losses from write-off on withholding taxes 9,910 - - -

Net gains on disposals of property, plant,

and equipment, and intangible assets 27 (5,247) (45,969) (612) -

Net gains on compensation for termination of

property, plant, and equipment contract 27 - (14,882) - -

Dividend income from short-term investments 27 (1,606) (1,795) (1,606) (1,795)

Dividend income from associates 14,27 - - (9,800) (7,350)

Dividend income from subsidiaries 13,27 - - (507,749) (307,612)

Net losses (gains) on disposals of investments in

a subsidiary and an associate 27 9,249 - 10,144 (144)

Net gains on disposals of short-term investments 7, 27 (110) (32,284) (110) (8,224)

Share of profits of associates and joint ventures 14, 15 (1,186,091) (254,662) - -

Unrealised losses (gains) on exchange rates from

short-term investments and loans 29,421 (46,704) (37,498) (65,234)

Realised (gains) losses on exchange rates from loans and

convertible bonds (1,411) - 18,903 (3,838)

Losses (gains) from settlement of cross currency and

interest rate swap agreements 27 4,865 (11,653) 4,865 (11,653)

Expenses for share based payment 462 462 - -

2,837,129 2,164,965 (63,871) (198,711)



(in thousand Baht)


10





Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of cash flowsFor the years ended 30 September 2014 and 2013 (restated)

Note 2014 2013 2014 2013


Cash flows from operating activities

Changes in operating assets and liabilities

Trade accounts receivable (1,268,223) (697,755) - -

Other accounts receivable (152,977) (15,749) - -

Receivables from related parties 1,069,992 (536,918) 19,499 76,780

Inventories 1,007,186 22,283 - -

Vessel supplies and spare parts (303,492) 196,146 - -

Prepayments (9,938) (39,770) 1,342 107

Other current assets 93,569 (63,050) (9,875) (484)

Other non-current assets 28,334 (12,961) 187 (452)

Trade accounts payable - others (184,711) 91,116 (3,646) (9)

Payables to related parties (6,951) 2,578 60,592 (10,193)

Other accounts payable (124,441) 1,239 (142) -

Advances from customers 55,030 (47,073) - -

Accrued income taxes 94,079 (17,321) - -

Accrued expenses 116,462 524,875 31,706 16,350

Other current liabilities 188,860 77,404 97,036 29,159

Employee benefit obligations 6,960 8,317 1,223 (9,250)

Exchange difference from translation of overseas companies 33,198 97,976 - -

Cash generated from (used in) operating activities 3,480,066 1,756,302 134,051 (96,703)

Finance costs paid (495,112) (504,752) (238,636) (221,628)

Income taxes paid (402,325) (108,559) (1,751) -

Net cash from (used in) operating activities 2,582,629 1,142,991 (106,336) (318,331)

Cash flows from investing activities

Purchases of property, plant, and equipment

and intangible assets (6,757,408) (1,651,519) (1,196) (23,179)

Payments for dry-docking (200,625) (760,214) - -

Payments for short-term loans to related parties - (9,209) (1,550) (1,314,892)

Payments for long-term loans to related parties - - (15,000) -

Payments for investments in subsidiaries,

associates, and joint ventures (113,144) (1,122,228) (4,528,827) (2,085,824)

Dividends received from short-term investments 1,606 1,795 1,606 1,795

Dividends received from subsidiaries - - 401,246 7,612

Dividends received from associates 64,844 36,855 9,800 7,350

Dividends received from joint ventures 173,075 119,644 - -

Proceeds from disposals of property, plant, and

equipment and intangible assets 8,590 367,501 612 -

Net proceeds from (payments for) short-term investments (816,935) 313,668 2,717 32,951

Proceeds from disposals of investments

in subsidiaries and associates 49,328 - 49,328 36,500

Proceeds from settlement of long-term loans 112,924 - 112,924 -

Proceeds from settlement of short-term loans to related parties - - 1,155,969 248,790

Proceeds from settlement of business co-operation

to a related party - 31,251 - -

Proceeds from settlement of long-term loans to related parties 500 750 318,211 750

Net cash used in investing activities (7,477,245) (2,671,706) (2,494,160) (3,088,147)



(in thousand Baht)


11



Thoresen Thai Agencies Public Company Limited and its SubsidiariesStatement of cash flows


Note 2014 2013 2014 2013


Cash flows from financing activities

Proceeds from long-term loans 1,525,219 1,037,951 - -

Net repayments of short-term loans (681,630) (96,715) - -

Repayments of short-term loans from related parties - - - (11,662)

Repayments of long-term loans and finance lease liabilities (1,453,904) (978,010) (220,000) (40,000)

Dividends paid from a subsidiary

to non-controlling interests (159,361) (9,215) - -

Dividends paid to shareholders (88) (1) (88) (1)

Proceeds from increase of share capital 23 4,230,899 3,975,566 4,230,899 3,975,566

Proceeds from increase of investment from non-controlling interests

of a subsidiary 396,698 1,464,401 - -

Net (repayments) proceeds from settlement of cross currency

and interest rate swap agreements (4,865) 11,653 (4,865) 11,653

Net cash from financing activities 3,852,968 5,405,630 4,005,946 3,935,556

Net (decrease) increase in cash and cash equivalents (1,041,648) 3,876,915 1,405,450 529,078

Cash and cash equivalents as at 1 October 7,446,247 3,582,194 650,977 123,271

Effect of deconsolidation (90,560) - - -

Effect of exchange rate changes on balances

held in foreign currencies (28,436) (12,862) (3,587) (1,372)

Cash and cash equivalents as at 30 September 6,285,603 7,446,247 2,052,840 650,977

Cash and cash equivalents as at 30 September comprise:

Cash and cash equivalents 6,289,847 7,458,387 2,052,840 650,977

Bank overdrafts (4,244) (12,140) - -

6,285,603 7,446,247 2,052,840 650,977

Non-cash transactions

Unpaid liabilities from dry-docking 8,440 21,525 - -

Unpaid liabilities from purchase of property, plant,

and equipment and intangible assets 255,981 12,085 409 233

Offsetting dividend income with short-term loans from subsidiaries - - 106,503 -

Offsetting dividend income with long-term loans to a subsidiary - - - 300,000

Dividend payables 3,985 4,073 3,985 4,073

Additional investment in a subsidiary by offsetting

with short-term loans to subsidiaries 13 - - 1,492,274 681,051

Settlement of short-term loan from related parties by offseting

with short-term and long-term loan to related parties - - 29,046 271,487

Private placement receivables - 399,214 - -


(in thousand Baht)




12



Thoresen Thai Agencies Public Company Limited and its Subsidiaries Notes to financial statements

13

Note Contents 1 General information 2 Basis of preparation of the financial statements 3 Change in accounting policy 4 Significant accounting policies 5 Related parties 6 Cash and cash equivalents 7 Short-term investments 8 Trade accounts receivable 9 Other accounts receivable 10 Deferred contract costs 11 Inventories 12 Assets held for sale 13 Investments in subsidiaries 14 Investments in associates 15 Investments in joint ventures 16 Goodwill 17 Property, plant, and equipment 18 Intangible assets 19 Deferred tax 20 Other non-current assets 21 Interest-bearing liabilities 22 Employee benefit obligations 23 Share capital and warrants 24 Legal reserves 25 Share-based payment 26 Segment information 27 Other operating income 28 Expenses by nature 29 Income tax expense 30 Earnings (losses) per share 31 Dividends 32 Promotional privileges 33 Financial instruments 34 Commitments and contingent liabilities 35 Events after the reporting period 36 Change of the Company’s accounting period 37 Thai Financial Reporting Standards (“TFRS”) not yet adopted

n o t e s t o f I n A n c I A l s tAt e m e n t sthoresen thAI AgencIes publIc compAny lImIted And Its subsIdIArIes

T H O R E S E N T H A I A G E N C I E S P L C096 Consolidated and Company finanCial statementsThoresen Thai Agencies Public Company Limited and its Subsidiaries Notes to financial statements

14

These notes form an integral part of the financial statements. The financial statements issued for Thai statutory and regulatory reporting purposes are prepared in the Thai language. These English language financial statements have been prepared from the Thai language statutory financial statements, and were approved and authorised for issue by the Board of Directors on 26 November 2014.

1 General information Thoresen Thai Agencies Public Company Limited (the “Company”) is incorporated in Thailand and has its registered office at 26/26-27 Orakarn Building, 8th Floor, Soi Chidlom, Ploenchit Road, Lumpinee, Pathumwan, Bangkok 10330. The Company was listed on the Stock Exchange of Thailand (the “SET”) on 25 September 1995. The principal business operations of the Company and its subsidiaries (the “Group”) involve the ownership of dry bulk vessels, certain shipping services, offshore oil and gas services, production and sales of fertilisers, coal trading, and warehouse and logistics services. The Group’s activities can be separated into four main categories, namely transport, infrastructure, energy, and the holding company. Details of the Company’s subsidiaries, associates, and joint ventures as at 30 September 2014 and 2013 are given in notes 13, 14, and 15.

2 Basis of preparation of the financial statements

(a) Statement of compliance The financial statements are prepared in accordance with Thai Financial Reporting Standards (“TFRS”); guidelines promulgated by the Federation of Accounting Professions (“FAP”); and applicable rules and regulations of the Thai Securities and Exchange Commission.

The FAP has issued the following new and revised Thai Financial Reporting Standard (“TFRS”) relevant to the Group’s operations and effective for annual accounting periods beginning on or after 1 January 2013. TFRS Topic TAS 12 Income Taxes TFRS 8 Operating Segments The adoption of these new TFRS with effect from 1 October 2013 has resulted in changes in the Group’s accounting policies. The effects of these changes are disclosed in note 3. In addition to the above new and revised TFRS, as at 30 September 2014, the FAP issued a number of other new and revised TFRS and announcements which are effective for financial statements beginning on or after 1 January 2014 and have not been adopted in the preparation of these financial statements. Those new and revised TFRS and announcements that are relevant to the Group’s operations are disclosed in note 37.

(b) Basis of measurement

The financial statements have been prepared on the historical cost basis except as stated in the accounting policies.

(c) Functional and presentation currency

The financial statements are presented in Thai Baht, which is the Company’s functional currency. All financial information presented in Thai Baht has been rounded in the notes to the financial statements to the nearest thousand unless otherwise stated.

ANNUAL REPORT 2014 097Consolidated and Company finanCial statementsThoresen Thai Agencies Public Company Limited and its Subsidiaries Notes to financial statements

15

(d) Use of estimates and judgements

The preparation of financial statements in conformity with TFRS requires management to make judgements, estimates, and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, income, and expenses. Actual results may differ from estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which estimates are revised and in any future periods affected. Information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements is included in the following notes: Note 13, 16, and 17 Key assumptions used in discounted cash flow projections Note 22 Measurement of defined benefit obligations Note 25 Measurement of share-based payments Note 33 Valuation of financial instruments Note 34 Commitments and contingent liabilities

3 Change in accounting policy Details of the new accounting policies adopted by the Group/Company are included in note 3(a) to 3(b) below. Other new and revised TFRS did not have any impact on the accounting policies, financial position or performance of the Group/Company.

3(a) Accounting for income tax The principal change introduced by TAS 12 is the requirement to account for deferred tax liabilities and assets in the financial statements. Deferred tax liabilities and assets are the amounts of income taxes payable and recoverable, respectively, in future periods in respect of temporary differences between the carrying amount of the liabilities or assets in the statement of financial position and the amount attributed to those liabilities or assets for tax purposes; and the carryforward of unused tax losses. The accounting policy for deferred tax is described in note 4(v). The Group/Company adopted TAS 12 with effect from 1 October 2013. The effects of the change are recognised retrospectively in the financial statements. The impact of the change on the financial statements is as follows:


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Not

es to

fina

ncia

l sta

tem

ents

16

C

onso

lidat

ed

finan

cial

sta

tem

ents

Sepa

rate

fin

anci

al s

tate

men

ts

Stat

emen

t of f

inan

cial

pos

ition

as

at

30 S

epte

mbe

r

30 S

epte

mbe

r

1 O

ctob

er

30

Sep

tem

ber

30

Sep

tem

ber

1

Oct

ober

2014

2013

2012

2014

2013

2012

(in th

ousa

nd B

aht)

Incr

ease

in

defe

rred

tax

asse

ts

178,

083

21

3,04

7

193,

157

80

,275

65,8

93

41

,306

D

ecre

ase

in o

ther

non

-cur

rent

ass

ets

-

(6,6

28)

(5

,899

)

-

-

- D

ecre

ase

in o

ther

cur

rent

liab

ilitie

s 92

,311

110,

652

13

3,75

1

-

-

- In

crea

se in

def

erre

d ta

x lia

biliti

es

(163

,757

)

(176

,325

)

(133

,914

)

-

-

- In

crea

se in

net

ass

ets

106,

637

14

0,74

6

187,

095

80

,275

65,8

93

41

,306

In

crea

se (d

ecre

ase)

in o

ther

com

pone

nt o

f equ

ity

(9,7

90)

(7

,887

)

(8,8

73)

1,

943

3,

569

2,

787

Incr

ease

in re

tain

ed e

arni

ngs

157,

286

19

0,53

3

229,

374

78

,332

62,3

24

38

,519

In

crea

se in

equ

ity a

ttrib

utab

le to

own

ers

of th

e C

ompa

ny

147,

496

18

2,64

6

220,

501

80

,275

65,8

93

41

,306

In

crea

se in

non

-con

trollin

g in

tere

sts

(40,

859)

(41,

900)

(33,

406)

-

-

- In

crea

se in

tota

l equ

ity

106,

637

14

0,74

6

187,

095

80

,275

65,8

93

41

,306


17

Statement of income for the year Consolidated Separate ended 30 September financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Decrease in other operating income (18,369) (25,082) - - (Increase)/decrease in income tax expense (13,850) (22,181) 16,009 23,805 (Decrease)/increase in profit for the year (32,219) (47,263) 16,009 23,805 Increase (decrease) in earnings per share - Basic earnings (losses) per share (in Baht) (0.03) (0.04) 0.01 0.03 - Diluted earnings per share (in Baht) (0.03) -* 0.01 -* * Diluted losses per share

There was no potential dilution in losses per share from the warrant for the year ended 30 September 2013, because the average share price during that period was lower than the exercise price.

3(b) Presentation of information on operating segments

From 1 October 2013, the Group has adopted TFRS 8 Operating Segments. The new policy for presentation of information on operating segments, together with information on the previous policy, is given below. The new policy has been applied retrospectively and segment information included in the financial statements for the year ended 30 September 2013, which are included in the Group’s financial statements for the year ended 30 September 2014 for comparative purposes. TFRS 8 introduces the “management approach” to segment reporting which is based on the presentation and disclosure of segment information according to the internal reports regularly reviewed by the Group’s Chief Operating Decision Maker in order to assess each segment’s performance and to allocate resources to those segments. The adoption of the new policy does not change the basis at presentation and disclosure of segment information and does not have significant impact on the segment information reported in the Group’s financial statements.

4 Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements, except as explained in note 3, which addresses changes in accounting policies.

(a) Basis of consolidation The consolidated financial statements relate to the Company and its subsidiaries, associates, and jointly-controlled entities (together referred to as the “Group”) and the Group’s interests in associates and jointly-controlled entities. Business combinations The Group applies the acquisition method for all business combinations other than those with entities under common control. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the Group takes into consideration potential voting rights that currently are exercisable. The acquisition date is the date on which control is transferred to the acquirer. Judgment is applied in determining the acquisition date and determining whether control is transferred from one party to another. Consideration transferred includes the fair values of the assets transferred, liabilities incurred by the Group to the previous owners of the acquiree, and equity interests issued by the Group. Consideration transferred also includes the fair value of any contingent consideration and share-based payment awards of the acquiree that are replaced mandatorily in the business combination. If a business combination results in the termination of pre-existing relationships between the Group and the acquiree, then the lower of the termination amount, as contained in the agreement, and the value of the off-market element is deducted from the consideration transferred and recognised in other expenses.


18

A contingent liability of the acquiree is assumed in a business combination only if such a liability represents a present obligation and arises from a past event, and its fair value can be measured reliably. The Group measures any non-controlling interest at its proportionate interest in the identifiable net assets of the acquiree. Transaction costs that the Group incurs in connection with a business combination, such as legal fees, and other professional and consulting fees are expensed as incurred. Acquisitions from entities under common control Business combinations of entities or businesses under common control are accounted for using a method similar to the pooling of interest method and in accordance with the guideline issued in 2009 by the FAP. Subsidiaries Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting policies of subsidiaries have been changed where necessary to align them with the policies adopted by the Group. Losses applicable to non-controlling interests in a subsidiary are allocated to non-controlling interests even if doing so causes the non-controlling interests to have a deficit balance. Loss of control Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in the statement of income. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently, it is accounted for as an equity-accounted investee or as an available-for-sale investment depending on the level of influence retained. Associates and jointly-controlled entities (equity-accounted investees) Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Significant influence is presumed to exist when the Group holds between 20% and 50% of the voting power of another entity. Jointly-controlled entities are those entities over whose activities the Group has joint control, established by contractual agreement and requiring unanimous consent for strategic financial and operating decisions. Investments in associates and jointly-controlled entities are accounted for in the consolidated financial statements using the equity method (equity-accounted investees) and are recognised initially at cost. The cost of the investment includes transaction costs. The consolidated financial statements include the Group’s share of the statement of income and other comprehensive income of equity accounted investees after adjustments to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group’s share of losses exceeds its interest in an equity accounted investee, the Group’s carrying amount of that interest is reduced to zero and recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee. Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income or expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with associates and jointly-controlled entities are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.


19

(b) Foreign currencies

Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currency of the Group entities at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to Thai Baht at the foreign exchange rates ruling at that date. Foreign exchange differences arising on translation are recognised in the statement of income. Non-monetary assets and liabilities measured at cost in foreign currencies are translated to Thai Baht using the foreign exchange rates on the dates of the transactions. Foreign operations The assets and liabilities of foreign operations are translated to Thai Baht at the foreign exchange rates on the reporting date. Goodwill and fair value adjustments arising on the acquisition of foreign operations are stated at exchange rates on the reporting date. The revenues and expenses of foreign operations, excluding foreign operations in hyperinflationary economies, are translated to Thai Baht at rates approximating the foreign exchange rates on the dates of the transactions. Foreign exchange differences arising on translation are recognised in other comprehensive income and presented in the translation adjustments for investments in subsidiaries in equity until disposal of the investment.

(c) Hedging

Hedge of future foreign currency transactions Gains and losses from forward exchange contracts and currency swaps used to hedge anticipated future currency transactions are deferred until the forecasted transaction occurs. Where the hedged item is a recognised asset or liability, it is translated at the contracted forward rates. Foreign currency assets and liabilities hedged by forward exchange contracts are translated to Thai Baht at the contracted forward exchange rates. Hedge of interest rates Interest differentials under swap arrangements are accrued and recorded as adjustments to the interest expense relating to the hedged loans. For interest rate forward contracts, the amounts received or paid on cash settlements, representing the gain or loss, are deferred and recognised over the life of the underlying monetary asset or liability as an adjustment to interest income or expense. For purchased interest rate options, the premiums paid are included in the statement of financial position under other assets or other liabilities. The premiums are amortised to interest income or expense over the life of the agreements. Hedge of bunker prices and freight rates Differentials under bunker swap arrangements are accrued and recorded as adjustments to the cost of bunker relating to the hedged bunker. For forward freight agreements, the amounts received or paid on cash settlements, representing the gain or loss, are deferred and recognised over the life of the underlying monetary asset or liability as an adjustment to revenues from freight charges. For purchased freight rate options, the premiums paid are included in the statement of financial position under other assets or other liabilities. The premiums are amortised to interest income or expense over the life of the agreements.


20

(d) Cash and cash equivalents Cash and cash equivalents comprise cash balances, call deposits, and highly liquid short-term investments. Bank overdrafts that are repayable on demand are a component of cash and cash equivalents for the purpose of the statement of cash flows.

(e) Trade and other accounts receivable Trade and other accounts receivable are stated at their invoice value less allowance for doubtful accounts. The allowance for doubtful accounts is assessed primarily on analysis of payment histories and future expectations of customer payments. Bad debts are written off when incurred.

(f) Inventories Inventories are measured at the lower of cost and net realisable value. Cost is calculated using the weighted average cost principle and comprises all costs of purchase, costs of conversion, and other costs incurred in bringing the inventories to their present location and condition. In the case of manufactured inventories and work-in-progress, cost includes an appropriate share of production overheads based on normal operating capacity. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs to complete and to make the sale.

(g) Vessel supplies and spare parts

Vessel supplies and spare parts mainly comprise bunker, vessel supplies, and spare parts. Bunker supplies are stated at cost, determined on the first-in, first-out basis. Vessel supplies and vessel spare parts are stated at cost, determined on the weighted-average basis. Rig supplies and rig spare parts are stated at historical cost, determined on the specific identification basis. The vessel and rig supplies and spare parts purchased to replace those used during the year are reported as vessel operating expenses and offshore service expenses in the statement of income.

(h) Assets held for sale Assets (or disposal groups comprising assets and liabilities) that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale. The assets (or disposal group) are measured at the lower of their carrying value and fair value less cost to sell. Any impairment loss on a disposal group is first allocated to goodwill, and then to remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets and investment properties. Impairment losses on initial classification as held for sale and subsequent gains and losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss.

(i) Investments Investments in subsidiaries, associates, and jointly-controlled entities Investments in subsidiaries, associates, and jointly-controlled entities in the separate financial statements of the Company are accounted for using the cost method. Investments in associates and jointly-controlled entities in the consolidated financial statements are accounted for using the equity method. Investments in other debt and equity securities Debt securities that the Group has the positive intent and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are stated at amortised cost, less any impairment losses. The difference between the acquisition cost and redemption value of such debt securities is amortised using the effective interest rate method over the period to maturity.


21

Debt securities and marketable equity securities, other than those securities held for trading or intended to be held to maturity, are classified as available-for-sale investments. Available-for-sale investments are, subsequent to initial recognition, stated at fair value, and changes therein, other than impairment losses and foreign currency differences on available-for-sale monetary items, are recognised directly in equity. Impairment losses and foreign exchange differences are recognised in the statement of income. When these investments are derecognised, the cumulative gain or loss previously recognised directly in equity is recognised in the statement of income. Where these investments are interest-bearing, interest calculated using the effective interest method is recognised in the statement of income. Equity securities which are not marketable are stated at cost less any impairment losses. Fixed term deposits are stated at amortised cost applying the effective interest rate method. The fair value of marketable equity securities classified as available-for-sale is determined as the quoted bid price on the reporting date. Disposal of investments On disposal of an investment, the difference between net disposal proceeds and the carrying amount together with the associated cumulative gain or loss that was reported in equity is recognised in the statement of income. If the Group disposes of part of its holding of a particular investment, the deemed cost of the part sold is determined using the weighted average method applied to the carrying value of the total holding of the investment.

(j) Property, plant, and equipment

Recognition and measurement Owned assets Property, plant, and equipment are stated at cost less accumulated depreciation and impairment losses (if any). Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When parts of an item of property, plant, and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant, and equipment. Gains and losses on disposal of an item of property, plant, and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant, and equipment, and are recognised net within other income or administrative expenses in the statement of income. Leased assets Leases in terms of which the Group substantially assumes all the risk and rewards of ownership are classified as finance leases. Property, plant, and equipment acquired by way of finance leases is capitalised at the lower of its fair value and the present value of the minimum lease payments at the inception of the lease, less accumulated depreciation and impairment losses. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in the statement of income.


22

Subsequent costs The cost of replacing a part of an item of property, plant, and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant, and equipment are recognised in the statement of income as incurred. Depreciation Depreciation is calculated based on the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value. Depreciation is charged to the statement of income and calculated on a straight-line basis over the estimated useful lives of each component of an item of property, plant, and equipment. The estimated useful lives are as follows: Buildings and factories 3 - 20 years Building improvements 3 - 20 years Offshore support vessels 5 - 30 years Ocean vessels (second-hand and new) 2 - 24 years Second-hand tender rigs 1 - 20 years Dry-docking 2 - 5 years Machinery and equipment 1 - 15 years Furniture, fixtures, and office equipment 2 - 10 years Motor vehicles 3 - 10 years Motor launches 10 years Barges 15 - 29 years No depreciation is provided on freehold land or assets under construction. Depreciation methods, useful lives, and residual values are reviewed at each financial year-end and adjusted, if appropriate.

(k) Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of the acquired subsidiary or associate at the date of acquisition. Goodwill on acquisitions of subsidiaries is reported as a separate line in the consolidated statements of financial position. Goodwill on acquisitions of associates and joint ventures is included in investments in associates and joint ventures and is tested for impairment as part of the overall balance. Separately recognised goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash generating units for the purpose of impairment testing. The allocation is made to those cash generating units or group of cash generating units that are expected to benefit from the business combination in which the goodwill arose.

(l) Intangible assets Computer software Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. Other intangible assets Trademarks and customer relationships acquired in a business combination are recognised at fair value at the acquisition date. Trademarks and customer relationships have a finite useful life and are carried at cost less accumulated amortisation and impairment (if any).


23

Amortisation Amortisation is based on the cost of the asset, or other amount substituted for cost, less its residual value. Amortisation is recognised in the statement of income and calculated on a straight-line basis over the estimated useful lives of intangible assets from the date that they are available for use, since this most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset. The estimated useful lives for the current and comparative periods are as follows:

Computer software 1 - 10 years Trademarks and customer relationships 5 - 8.2 years

Amortisation methods, useful lives, and residual values are reviewed at each financial year-end and adjusted, if appropriate.

(m) Impairment

The carrying amounts of the Group’s assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the assets’ recoverable amounts are estimated. An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. The impairment loss is recognised in the statement of income. When a decline in the fair value of an available-for-sale investment has been recognised directly in equity and there is objective evidence that the value of the asset is impaired, the cumulative loss that had been recognised directly in equity is recognised in the statement of income even though the financial asset has not been derecognised. The amount of the cumulative loss that is recognised in the statement of income is the difference between the acquisition cost and current fair value, less any impairment loss on that financial asset previously recognised in the statement of income. Calculation of recoverable amount The recoverable amount of available-for-sale investment is calculated by reference to the fair value. The recoverable amount of a non-financial asset is the greater of the asset’s value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined for the cash-generating unit to which the asset belongs. Reversals of impairment An impairment loss in respect of a financial asset is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognised. For financial assets carried at amortised cost and available-for-sale investment that are debt securities, the reversal is recognised in the statement of income. For available-for-sale investment that are equity securities, the reversal is recognised in other comprehensive income. An impairment loss in respect of goodwill is not reversed. Impairment losses recognised in prior periods in respect of other non-financial assets are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.


24

(n) Interest-bearing liabilities Interest-bearing liabilities are recognised initially at fair value less attributable transaction charges. Subsequent to initial recognition, interest-bearing liabilities are stated at amortised cost with any difference between cost and redemption value being recognised over the period of the borrowings on an effective interest basis.

(o) Trade and other accounts payable Trade and other accounts payable are stated at cost.

(p) Employee benefits Defined contribution plans A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit expense in the periods during which services are rendered by employees. Defined benefit plans A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The defined benefit plan is calculated by an independent actuary using the projected unit credit method. The present value of the benefit obligations is determined by discounting the estimated future cash outflows using interest rates of referred government bonds that are denominated in the currency in which the benefits will be paid and that have terms to maturity approximating to the terms of the related retirement liabilities. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited in the statement of income. Other employee benefits The drilling companies of the Group provide retention incentives to certain employees. The entitlement to these incentives is conditional on the staff remaining in service up to the completion of the minimum entitlement service periods. The expected costs of these incentives are accrued over the period of the entitlement service periods without discount to their present value, as there is no significant impact from a discounted value calculation approach. Termination benefits Termination benefits are recognised as an expense when the Group is committed demonstrably, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Group has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are payable more than 12 months after the reporting period, then they are discounted to their present value. Short-term employee benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under a short-term cash bonus plan, if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.


25

Share-based payments The Group operates a number of equity-settled, share-based compensation plans, under which the entity that receives services from employees compensates in part through equity instruments (options) of the Group. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted: - including any market performance conditions; - excluding the impact of any service and non-market performance vesting conditions (for example, profitability,

sales growth targets, and remaining an employee of the entity over a specified time period); and - excluding the impact of any non-vesting conditions (for example, the requirement for employees to save). Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the entity revises its estimates of the number of options that are expected to vest based on the non-marketing vesting conditions. It recognises the impact of the revision to original estimates, if any, in the statement of income, with a corresponding adjustment to equity. When the options are exercised, the Group issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised. The grant by the Group of options over its equity instruments to the employees of the Group is treated as a capital contribution. The fair value of employee services received, measured by reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary undertakings, with a corresponding credit to equity.

(q) Provisions

A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Onerous contracts A provision for onerous contracts is recognised when the expected benefits to be derived by the Group from a contract are lower than the unavoidable cost of meeting the Group’s obligations under the contract. The provision is measured at the present value of the lower of the expected net cost of terminating the contract and the expected net cost of continuing with the contract.

(r) Share capital

Ordinary shares Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as a deduction from equity, net of any tax effects.

(s) Revenue Revenue excludes value added taxes and is arrived at after deduction of trade discounts and volume rebates. Rendering of services Freight charges of each voyage are generally recognised as revenues at the completion of the voyage. Where a voyage is incomplete as of the statements of financial position date, freight charges are recognised as revenue in proportion to the lapsed time of the voyage. Freight charges shown in the statement of income represent the net freight charges after deduction of related commissions. Offshore service income is recognised as services are performed based upon (a) contracted day rates and the number of operating days during the period or (b) agreed service charges.


26

Mobilisation activities related to drilling rig activity to mobilise a rig from one geographic area to another are linked to the underlying contracts. Certain contracts include mobilisation fees paid at the start of the contracts. Where the mobilisation fee covers a general or specific upgrade of a rig or equipment, the fee is recognised as revenue over the contract period. In cases where the fee covers specific operating expenses at the start up of the contract, the fee is recognised in the same period as the expenses. Sale of goods Revenue from sales of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there is continuing management involvement with the goods or there are significant uncertainties regarding recovery of the consideration due, associated costs, or the probable return of goods. Commissions Commissions for services rendered to vessels and service income are generally recognised as revenues when services are completed and billed. Rental income Rental income is recognised as revenue on an accrual basis at the amount as specified under each lease agreement. Dividend income Dividend income is recognised in the statement of income on the date the Group’s right to receive payments is established. Interest income Interest income is recognised in the statement of income as it accrues.

(t) Finance costs Finance costs comprise interest expense and relevant costs on borrowings. Borrowing costs that are not directly attributable to the acquisition, construction, or production of a qualifying asset are recognised in the statement of income using the effective interest method.

(u) Lease payments Payments made under operating leases are recognised in the statement of income on a straight line basis over the term of the lease. Contingent lease payments are accounted for by revising the minimum lease payments over the remaining term of the lease when the lease adjustment is confirmed.

(v) Income tax Income tax expense for the year comprises current tax. Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. In determining the amount of current tax, the Company takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. The Company believes that its accruals for tax liabilities are adequate for all open tax years based on its assessment of many factors, including interpretations of tax law and prior experience. This assessment relies on estimates and assumptions and may involve a series of judgements about future events. New information may become available that causes the Company to change its judgement regarding the adequacy of existing tax liabilities; such changes to tax liabilities will impact tax expense in the period that such a determination is made.


27

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss; and differences relating to investments in subsidiaries and jointly-controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Group/Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date. A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised. Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realised. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

(w) Earnings per share The Group presents basic and diluted earnings per share (“EPS”) data for its ordinary shares. Basic EPS is calculated by dividing the the statement of income attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the the statement of income attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares, which comprise warrants.

(x) Dividend distribution Dividend to the Company’s shareholders is recognised as a liability in the consolidated and separate financial statements in the period in which the interim dividends are approved by the Board of Directors and the annual dividends are approved by the Company’s shareholders.

(y) Segment reporting Segment results that are reported to the Group’s CEO (the chief operating decision maker) include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.


28

5 Related parties For the purposes of these financial statements, parties are considered to be related to the Group/Company if the Group/Company has the ability, directly or indirectly, to control or jointly control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group/Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Relationships with related parties, except for subsidiaries, associates, and joint ventures described in notes 13, 14, and 15, are as follows: Name of entities Country of Nature of relationships incorporation/ nationality Key management personnel Multi-nationalities Persons having authority and responsibility

for planning, directing, and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of the Group/Company.

SKI Energy Resources Inc. (“SERI”) Philippines An associate of Merton Group (Cyprus) Limited, the Company’s associate.

The pricing policies for particular types of transactions are explained further below:

Transactions Pricing policies IT service and office and office equipment rental income Prices normally charged to a third party Service income Prices normally charged to a third party Management fee income Actual cost plus margin Interest income/interest expenses Market linked rate/the borrowing costs of the lender Management and administrative fees Actual cost plus margin IT service and service expenses Prices normally charged by a third party Vessel operating expenses, offshore service expenses, and cost of sales Prices normally charged by a third party


29

Significant transactions for the years ended 30 September 2014 and 2013 with related parties were as follows:

Consolidated Separate financial statements financial statements

Years ended 30 September 2014 2013 2014 2013 (in thousand Baht) Subsidiaries IT service and office and office equipment rental income - - 16,982 23,118 Service income - - 624 891 Management fee income - - - (4,273) Interest income - - 26,541 24,392 IT service and service expenses - - 1,740 9,958 Interest expenses - - 140,695 136,051 Key management personnel Key management personnel compensation

Short-term benefits 207,903 211,531 72,706 96,221 Post-employment benefits 7,590 2,975 5,142 1,077

Total key management personnel compensation 215,493 214,506 77,848 97,298 Key management personnel compensation comprises salaries, other benefits, other remuneration, and meeting fees. Consolidated Separate financial statements financial statements Years ended 30 September 2014 2013 2014 2013 (in thousand Baht) Associates and joint ventures IT service and office and office equipment rental income 36,508 25,946 8,127 7,953 Offshore service income 2,701,004 1,540,011 - - Service income - 383 211 383 Interest income (207) 4,378 207 241 Vessel operating expenses 1,570 1,780 - - Offshore service expenses 15,926 23,847 - - Cost of sales 13,909 35,328 - - Management and administrative fees 2,741 19,023 - -


30

Balances as at 30 September 2014 and 2013 with related parties were as follows:


Note 2014 2013 2014 2013 (in thousand Baht) Trade accounts receivable Associates and joint ventures 8 1,426,808 1,043,583 - - Receivables from related parties Subsidiaries - - 494,865 513,113 Associates and joint ventures 6,774 5,222 825 2,076 Other related parties 243,617 236,223 - - 250,391 241,445 495,690 515,189 Less allowance for impairment (243,617) (236,223) - - Net 6,774 5,222 495,690 515,189 Consolidated As at 30 September 2014 and 2013, receivables from other related parties include advances for share subscription in SERI, totalling USD 5 million and interest receivable of USD 2.5 million which are fully impaired as management is of the view that the operations of SERI are not expected to be adequately financed in order to produce sufficient coal to achieve break-even performance.

Consolidated Separate financial statements financial statements 2014 2013 2014 2013

(in thousand Baht) Short-term loans to related parties Subsidiaries - - 2,083,753 4,732,061 Other related parties 139,205 134,980 - - 139,205 134,980 2,083,753 4,732,061 Less allowance for impairment (139,205) (134,980) - - Net - - 2,083,753 4,732,061 The Company Short-term loans to subsidiaries can be called at any time and are unsecured. The loans mainly bear interest at 3.0% per annum (2013: 3.0% per annum). Consolidated As at 30 September 2014, short-term and convertible loans to SERI by Soleado Holdings Pte. Ltd. (“Soleado”), a wholly owned subsidiary of the Company, in USD currency totalling USD 4.3 million, or Baht 139.0 million (2013: USD 4.3 million, or Baht 135.0 million) which unsecured and repayable at call are fully impaired.


31


2014 2013 2014 2013 (in thousand Baht) Long-term loans to related parties Subsidiaries - - 4,578,953 4,964,289 Associates and joint ventures 2,073 2,573 2,073 2,573 Other related parties 576,245 558,754 - - 578,318 561,327 4,581,026 4,966,862 Less allowance for impairment (576,245) (558,754) (3,238,427) (2,731,526) Net 2,073 2,573 1,342,599 2,235,336 The Company As at 30 September 2014, the Company granted unsecured long-term loans in USD and Baht currency to subsidiaries totalling Baht 4,579 million (2013: Baht 4,964.3 million), which carry interest at fixed rates (2013: fixed rates) and are repayable every month. In addition, the Company granted unsecured long-term loans to an associate amounting to Baht 2.1 million (2013: Baht 2.6 million), which carry interest at Minimum Overdraft Rate (“MOR”) plus a certain margin (2013: MOR plus a certain margin). During the year ended 30 September 2014, the Company set up additional allowance for impairment for long-term loans to a subsidiary of Baht 506.9 million because the subsidiary’s investment was impaired. The Company’s management assessed the impairment of long term loans to related parties based on value-in-use of return from investment in subsidiaries based on their strategic plans. Consolidated On 14 August 2009, Soleado entered into a loan facility agreement with Merton Investments NL BV (“Merton”) to provide a loan up to USD 15 million to Merton at a fixed interest rate. The maturity date of the loan is three years after the first drawdown date which was on 23 November 2009. Merton would on-lend such loan to SERI. Both loans were drawn down according to the progress of the coal mine construction done by SERI in the Philippines. The collateral for the Soleado loan includes pledge of shares held by Merton Group (Cyprus) Limited in Merton, pledge of shares held by Merton in SERI, pledge of Merton bank accounts, assignment of Merton's interest and benefit in SERI loan, and mortgage of real properties and chattels by SERI. On 25 August 2011, it was agreed by Merton and Soleado that Merton will assign its loan to SERI to Soleado and all principal and interest outstanding as of 23 August 2011 totalling USD 20.3 million would be converted into new equity in SERI. The debt conversion to equity is subject to approval of the Philippines Securities Exchange Commission. However, the Philippines Securities Exchange Commission has ruled that the share restructuring proposed by SERI, Soleado, and SERI’s shareholders must be changed due to pending legal motions about foreign share ownership restrictions for Philippine companies engaged in mining; thus, the first submission was refused. Given that all partners are unable to properly finance the operations of SERI, it is producing insufficient coal to reach break-even cash flow and is in the midst of restructuring. To be prudent, full provision has been taken against the outstanding loans, interest receivables, and advances for share subscription in SERI.


32

Movements of long-term loans to related parties during the year ended 30 September 2014 are as follows:

Consolidated Separate financial financial statements statements (in thousand Baht)

Long-term loans to related parties At 1 October 2013 2,573 2,235,336 Additional - 15,000 Repayments (500) (447,562) Impairment charges - (506,901) Unrealised gains on exchange rates - 46,726 At 30 September 2014 2,073 1,342,599 Less current portion of long-term loans (2,073) (607,723) Long-term loans - net of current portion - 734,876 Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Payables to related parties Subsidiaries - - 365,001 208,783 Associates and joint ventures 7,576 14,314 - - 7,576 14,314 365,001 208,783 Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Short-term loans from related parties Subsidiaries - - 5,816,657 5,916,004 - - 5,816,657 5,916,004 The Company The short-term loans from subsidiaries can be called at any time and are unsecured. The loans bear interest at 3.0% and 4.6% per annum (2013: 2.15% and 3.0% per annum).

6 Cash and cash equivalents

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Cash on hand 10,501 102,200 30 30 Deposits at banks 6,279,346 7,356,187 2,052,810 650,947 Total 6,289,847 7,458,387 2,052,840 650,977 As at 30 September 2014, deposits at banks bear interest at the rates between 0% to 5% per annum (2013: 0% to 7% per annum).


33

7 Short-term investments

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Equity securities 56,208 58,815 56,208 58,815 Debt securities 1,297 1,297 1,297 1,297 Fixed term deposits 1,276,057 443,000 - - Other investments 18,601 17,945 18,601 17,945 1,352,163 521,057 76,106 78,057 Accumulated changes in fair value (9,713) (17,850) (9,713) (17,850) Total 1,342,450 503,207 66,393 60,207 During the year ended 30 September 2014, the Group and the Company sold short-term investments in equity securities of Baht 2.6 million and Baht 2.6 million, respectively and incurred gains on disposals of short-term investments in the consolidated and separate financial statements of Baht 0.11 million and Baht 0.11 million, respectively.

8 Trade accounts receivable Consolidated Separate financial statements financial statements Note 2014 2013 2014 2013 (in thousand Baht) Related parties Trade accounts receivable 5 1,426,808 1,043,583 - - Other parties Trade accounts receivable 2,576,378 2,959,794 - - Accrued income 428,572 188,354 - - 3,004,950 3,148,148 - - Less allowance for doubtful accounts (187,787) (225,504) - - Net 2,817,163 2,922,644 - - Total 4,243,971 3,966,227 - - Bad and doubtful debts expense 9,967 83,785 - -


34

Aging analyses for trade accounts receivable were as follows: Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Related parties Within credit terms 397,849 860,031 - - Overdue :

Less than 3 months 646,699 - 3 - 6 months 382,260 183,552 - -

1,426,808 1,043,583 - - Other parties Within credit terms 1,307,659 1,961,355 - - Overdue :

Less than 3 months 921,771 711,063 - - 3 - 6 months 122,560 133,506 - - 6 - 12 months 46,657 18,114 - - Over 12 months 177,731 135,756 - -

2,576,378 2,959,794 - - Less allowance for doubtful accounts (187,787) (225,504) - - Net 2,388,591 2,734,290 - - Total 3,815,399 3,777,873 - - Full allowance for doubtful accounts has been set up for all trade accounts receivable which management considers as non-collectible.

9 Other accounts receivable Consolidated Separate financial statements financial statements Note 2014 2013 2014 2013 (in thousand Baht) Advances for business expenses 154,486 272,736 - - Private placement receivables from non-controlling shareholders of a subsidiary 13 - 399,214 - - Other accounts receivables 217,752 143,293 - - Advances to employees 39,915 32,223 182 205 Accrued interest income 16,000 4,735 12,617 2,830 428,153 852,201 12,799 3,035 Less allowance for doubtful accounts - (10,744) - - Net 428,153 841,457 12,799 3,035


35

10 Deferred contract costs Consolidated

financial statements (in thousand Baht) At 1 October 2013 261,202 Additions - Amortisation on deferred contract costs (65,711) Translation adjustments 7,894 At 30 September 2014 203,385 On 30 September 2012, USD 9.3 million (equivalent to Baht 286.7 million) was paid by Mermaid Subsea Services (International) Ltd. (formerly Subtech Ltd.), a subsidiary of Mermaid Maritime Public Company Limited (“MMPLC”), to General Technology & Systems Co., Ltd (“Gentas”). The payment consists of the following elements: (a) USD 0.3 million (equivalent to Baht 9.2 million) as consideration for the acquisition of Gentas’ 30% equity interest in Subtech Saudi Arabia, (recorded in other accounts receivable) and (b) USD 9.0 million (equivalent to Baht 277.5 million) (recorded in deferred contract costs) as (i) compensation for loss of expected profits to Gentas, if not for the sale of its 30% equity interest in Subtech Saudi Arabia, pertaining to a recently awarded five-year inspection, repair, and maintenance contract with Saudi Aramco (“IRM Contract”) worth more than USD 530 million of revenues and (ii) as an advance payment for Gentas assistance to secure the IRM Contract. The USD 9.0 million was related to securing the IRM Contract that was been executed by a jointly-controlled operation of MMPLC, Zamil Mermaid Offshore Services Co. (LLC) (“ZMOS”), and was recognised as deferred contract costs. The deferred contract costs would be amortised rateably over the period of execution of the contract, starting from the moment revenue is first recognised, which is approximately five years. The total IRM Contract revenue over five years period is estimated to be approximately USD 530 million. The Group’s estimated revenue is between 60 to 70 percent of the IRM Contract revenue over this period. The IRM Contract was awarded to ZMOS on 25 October 2012. ZMOS is a newly established entity that the Group controls jointly with Zamil Offshore Services Co. (“Zamil”). ZMOS is billing Saudi Aramco at agreed rates in the IRM Contract, and the two partners are billing ZMOS for the cost incurred in executing the IRM contract.

11 Inventories

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Inventories 802,635 1,776,770 - - Tools and supplies 47,975 40,161 - - Total 850,610 1,816,931 - - Less allowance for lower net realisable value of inventories (191,552) (480,721) - - Net 659,058 1,336,210 - - As at 30 September 2014, inventories with carrying amount of VND 170 billion or Baht 255 million (2013: VND 218 billion or Baht 327 million), were pledged with banks as security for a loan facility of VND 270 billion or Baht 405 million.


36

12 Assets held for sale Assets held for sale represents the investments in an associate, Merton Group (Cyprus) Ltd., and a joint venture, Qing Mei Pte. Ltd., held by the Company’s subsidiary. At 30 September 2014, a Company’s subsidiary has contractual right to exchange these investments for another investment with some consideration as disclosed in note 14 and 15. The share transferring and its settlement are in process and planned to complete within one year. Accordingly, these investments in the total carrying value of Baht 149 million were classified as assets held for sale under current assets in the consolidated financial statements as at 30 September 2014.

13 Investments in subsidiaries Investments in subsidiaries as at 30 September 2014 and 2013 comprise investments in the following companies: Nature of Country of % Ownership interest Name of subsidiaries business incorporation 2014 2013 Holdings - Soleado Holdings Pte. Ltd. (“Soleado”) Holding company Singapore 100.0 100.0 With subsidiaries as follows: - PM Thoresen Asia (Singapore) Pte. Ltd. ” Singapore - 100.0

(Formerly Atlantis Offshore Construction Pte. Ltd.)

- Baconco Co., Ltd. Fertiliser production Vietnam - 100.0 With associates as follows: - Merton Group (Cyprus) Limited Coal mining Philippines - Baria Serece Port operations Vietnam With joint ventures as follows: - Petrolift Inc. Maritime transportation

services Philippines

- Qing Mei Pte. Ltd. Coal mining Singapore - Athene Holdings Ltd. Holding company Thailand 99.9 99.9 - PM Thoresen Asia Holdings Public Company

Limited (“PMTA”) ” Thailand 99.9 99.9

With subsidiaries as follows: - PM Thoresen Asia (Singapore) Pte. Ltd. General trading Singapore 100.0 -

(Formerly Atlantis Offshore Construction Pte. Ltd.)

- Baconco Co., Ltd. Fertiliser production Vietnam 100.0 -

Transport - Premo Shipping Public Company Limited Ship management Thailand 99.9 - - Thor Dynamic Shipping Co., Ltd. * International maritime Thailand - 99.9 transportation - Thor Endeavour Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Energy Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Enterprise Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Harmony Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Integrity Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Jupiter Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Wind Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Wave Shipping Co., Ltd. * ” Thailand - 99.9


37

Nature of Country of % Ownership interest Name of subsidiaries business incorporation 2014 2013 Transport (continued) - Thoresen Shipping Singapore Pte. International maritime Singapore 100.0 100.0

Ltd. (“TSS”) transportation With subsidiaries as follows: - Thor Friendship Shipping Pte. Ltd. ” Singapore 100.0 100.0 - Thor Fortune Shipping Pte. Ltd. ” Singapore 100.0 100.0 - Thor Horizon Shipping Pte. Ltd. ” Singapore 100.0 100.0 - Thoresen Shipping Denmark APS Commercial dry bulk

shipping activities Denmark 100.0 100.0

- Thoresen Shipping South Africa ” South Africa 100.0 - (PTY) Ltd.

- Thoresen & Company (Bangkok) Limited Ship management Thailand 99.9 99.9 - Thoresen Chartering (HK) Ltd.*** International maritime Hong Kong 99.9 99.9 transportation - Thoresen Shipping Germany GmbH ” Germany 100.0 100.0 - Thor Orchid Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Mercury Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Mariner Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Merchant Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Navigator Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Captain Shipping Co., Ltd. * ” Thailand - 99.9 - Hermes Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Pilot Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Master Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Commander Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Transporter Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Nereus Shipping Co., Ltd. * ” Thailand - 99.9 - Herakles Shipping Co., Ltd.** ” Thailand 99.9 99.9 - Heron Shipping Co., Ltd.** ” Thailand 99.9 99.9 - Thor Nectar Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Jasmine Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Champion Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Star Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Skipper Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Sailor Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Sun Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Sky Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Spirit Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Sea Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Lotus Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Trader Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Traveller Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Venture Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Triumph Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Guardian Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Confidence Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Nautica Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Neptune Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Nexus Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Tribute Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Alliance Shipping Co., Ltd.* ” Thailand - 99.9 - Thor Nautilus Shipping Co., Ltd. * ” Thailand - 99.9 - Thor Transit Shipping Co., Ltd. * ” Thailand - 99.9


38

Nature of Country of % Ownership interest Name of subsidiaries business incorporation 2014 2013 Transport (continued) - PT Perusahaan Pelayaran Equinox Maritime

transportation Indonesia - 49.0

services - Thoresen Chartering (PTE) Ltd.*** Ship brokerage Singapore 100.0 100.0 - Thoresen Service Center Ltd.*** Service provider Thailand 99.9 99.9 - Asia Coating Services Ltd.*** Coating services Thailand 99.9 99.9 - Thoresen Shipping FZE Ship agency UAE 100.0 100.0 With an associate as follows: - Sharjah Ports Services LLC Port operations UAE Energy - Mermaid Maritime Public Company Limited Offshore services Thailand 57.1 57.1 (“MMPLC”) investments With subsidiaries as follows: - Mermaid Offshore Services Ltd. Subsea Service Thailand 100.0 100.0

(“MOS”) Provider of offshore oil and gas industry With subsidiaries as follows: - Seascape Surveys (Thailand) Ltd. Subsea Service

Provider, hydrographic

survey and positioning to the offshore oil and gas industry

Thailand 100.0 100.0

- Seascape Surveys Pte. Ltd. ” Singapore 100.0 100.0 With a subsidiary as follows: - PT Seascape Surveys Indonesia ” Indonesia 95.0 95.0 - Mermaid Offshore Services Pte. Ltd. Marketing services

for offshore oil and gas contract

Singapore 100.0 100.0

- Mermaid Drilling Ltd. Production and exploration drilling

services

Thailand 95.0 95.0

With subsidiaries as follows: - MTR-1 Ltd. Drilling services Thailand 95.0 95.0 - MTR-2 Ltd. ” Thailand 95.0 95.0 - Mermaid Drilling (Malaysia) Sdn. Bhd. ” Malaysia 95.0 95.0 - MTR-1 (Singapore) Pte. Ltd. ” Singapore 95.0 95.0 - MTR-2 (Singapore) Pte. Ltd. ” Singapore 95.0 95.0 - Mermaid Drilling (Singapore) Pte. Ltd. Production and

exploration drilling services

Singapore 100.0 100.0

- MTR-3 (Singapore) Pte. Ltd. ” Singapore 100.0 100.0 - MTR-4 (Singapore) Pte. Ltd. ” Singapore 100.0 - - MTR-5 (Singapore) Pte. Ltd. ” Singapore 100.0 -


39

Nature of Country of % Ownership interest Name of subsidiaries business incorporation 2014 2013 Energy (continued)

- Mermaid Maritime Mauritius Ltd. Investment holding Mauritius 100.0 - With subsidiaries as follows: - Mermaid International Ventures. ” Cayman 100.0 -

With subsidiaries as follows: - Mermaid Subsea services Diving and Subsea Seychelles 100.0 100.0

(International) Ltd. (formerly contractor Subtech Ltd.) With subsidiaries as follow: - Subtech Saudi Arabia Limited - Subtech Qatar Diving and

Diving Services ”

Saudi Arabia Qatar

70.0 49.0

70.0 49.0

Marine Services LLC With associates as follows: - Asia Offshore Drilling Limited,

With subsidiaries as follows Drilling services

Bermuda

- Asia Offshore Rig 1 Limited ” Bermuda - Asia Offshore Rig 2 Limited ” Bermuda - Asia Offshore Rig 3 Limited ” Bermuda

With a joint venture as follows: - Zamil Mermaid Offshore Services Co. (LLC)

Inspection, installation, repair and

maintenance services for offshore oil and gas

industry

Saudi Arabia

Infrastructure - Chidlom Marine Services & Supplies Ltd. Supply cargo Thailand 99.9 99.9

lashing materials - GAC Thoresen Logistics Ltd. Warehousing Thailand 51.0 51.0 - Unique Mining Services Public Sale of coal Thailand 88.7 88.7 Company Limited (“UMS”) (invested by Athene Holdings Ltd.) With subsidiaries as follows: - UMS Distribution Co., Ltd. Logistics management Thailand 99.9 99.9

(Formerly “UMS Logistics Management Co., Ltd.”)

- UMS Lighter Co., Ltd. Boat conveyance Thailand 99.9 99.9 - UMS Pellet Energy Co., Ltd. Trade of wood pellet Thailand 99.9 99.9

(Formerly UMS Transport Co., Ltd.) - UMS Port Services Co., Ltd. Port service Thailand 99.9 99.9 - Baconco Co., Ltd. (invested by Soleado

until 30 September 2013 and invested by PMTA since 30 September 2013)

Fertiliser production Vietnam 100.0 100.0

* On 1 August 2014, the registration of the amalgamation of 45 Thai dormant shipping companies which

were subsidiaries of the Company (the “Amalgamated Companies”) and the establishment for the new company as a result of such amalgamation, namely Premo Shipping Co., Ltd. (“Premo”) with the Ministry of Commerce were successfully completed. Premo’s registered and paid-up capital has been consolidated from the amalgamation of the Amalgamated Companies without any additional fund injected in which the Company holds 99.9% of its shares on an original proportion basis. Premo assumed all assets, capital, liabilities, rights, obligations and responsibilities of the Amalgamated Companies. On 9 September 2014, Premo registered for the conversion of the company status into a public limited company.

** In the process of liquidation. *** Operation ceased as of 30 September 2014.


40

The movements of investments in subsidiaries during the years ended 30 September 2014 and 2013 are as follows:

Separate financial statements 2014 2013 (in thousand Baht)

At 1 October 21,265,656 18,947,210 Additional investments

Paid by cash 4,528,827 2,085,824 Offsetting with short-term loan to a subsidiary 1,492,274 681,051

Disposals (59,471) (36,356) Reversal (provision) of allowance of impairment, net 505,866 (412,073) At 30 September 27,733,152 21,265,656 Significant movements of investments in subsidiaries of the Company during the year ended 30 September 2014 and 2013 were as follows: 2014 additions and disposal During the year ended 30 September 2014, the Company subscribed for additional ordinary shares of subsidiaries as follows: 1. An additional 93 million ordinary shares of PMTA at Baht 10 per share in the total amount of Baht 930

million. The group’s ownership in PMTA remains the same at 99.99%. 2. An additional 140.06 million ordinary shares of TSS at SGD 1 per share in the total amount of Baht 3,598.83

million. The group’s ownership in TSS remains the same at 100%. On 12 February 2014, Soleado transferred 110 million ordinary shares in MMPLC (7.79%) to the Company at SGD 57.2 million (equivalent to Baht 1,492 million) at the market price of SGD 0.52 per share to offset with short-term loans to Soleado in the same amount. The purpose of this transfer is to maintain the Thai company’s shareholding in MMPLC and the percentage of shareholding in MMPLC by the Group. In December 2013, the Company entered into the Share Sales and Purchases Agreement with PT Pesona Sentra Utama and Mika Rungtoya Trisnad to sell the shares of PT Perusahaan Pelayaran Equinox (“Equinox”) for a lump sum amount of USD 1.5 million (equivalent to Baht 49.32 million). The Company sold this investment in January 2014 and recognised loss on disposal of investment of Baht 10.14 million in the separate financial statements for the year ended 30 September 2014. Details of the disposal are as follows:

Separate financial statements (in thousand Baht) Sales consideration 49,327 Net book value of investments (59,471) Loss on disposal of investment in a subsidiary (10,144) This disposal cause the control on investment ceased. Accordingly, the Company deconsolidated Equinox from the consolidated financial statements at the transaction date and recognised loss on disposal of investment of Baht 9.25 million in the consolidated statement of income for the year ended 30 September 2014.


41

Subsidiaries - Soleado In August 2014, Soleado subscribed for 4,187,000 scripless shares at average price of SGD 0.39 per share in MMPLC for total consideration of SGD 1.6 million, or Baht 42.0 million. 2013 additions and disposal On 20 March 2013, the Board of Directors of MMPLC approved a rights issue and private placement to raise gross proceeds of approximately SGD 176.1 million. The private placement would follow the rights issue for the remaining unsubscribed shares of the rights issue. On 19 September 2013, MMPLC announced the issue and listing of 569,692,359 rights shares at SGD 0.28 per share with gross proceeds to the company amounting to SGD 159,513,860. On 30 September 2013, MMPLC announced the details of the private placement of 58,105,821 shares at SGD 0.28 resulting in gross proceeds of SGD 16,269,630. The private placement was completed on 4 October 2013. After the rights issue and private placement, the Group owns 57.14% of the share capital of MMPLC which is equal to its equity interest prior to the rights issue and private placement. As at 30 September 2013, the Group recognised a receivable from non-controlling shareholders in MMPLC and a corresponding increase in non controlling interests in MMPLC amounting to SGD 16,269,630, or Baht 399.2 million.

On 27 May 2013, the Company subscribed for 21,525,400 additional shares at a price of SGD 1.0 per share in Thoresen Shipping Singapore Pte. Ltd. for total consideration of USD 17.0 million, or Baht 513.4 million. On 7 June 2013, the Company established a new subsidiary, PM Thoresen Asia Holdings Ltd., with registered and paid-up share capital of Baht 1.0 million. On 4 December 2012, the Company entered into a Share Sale and Purchase Agreement with TSS to sell and transfer all shares of Thoresen & Company (Bangkok) Limited from the Company to TSS. Details of the disposal are as follows:

Separate financial statements (in thousand Baht) Sales consideration 36,500 Net book value of investments in subsidiary (36,356) Gain on disposal of investment in a subsidiary 144 Impairment charge During the year ended 30 September 2013, an impairment loss of Baht 498.7 million was recognised for the Company’s investment in TSS, because several of TSS’s operating assets were impaired. The Company’s management assessed the impairment of the investment in TSS for the year 2013 based on the assumptions below:

- The recoverable amount of TSS was based on the higher of the value-in-use and the fair-value-less-cost-to-sell

of TSS. - The value-in-use was determined using the income approach based on cash flow projections of the subsidiary

for the currently available vessels, as well as the charter-in vessels. - The weighted average cost of capital (“WACC”) of 8% was used as a discount factor. The cost of the equity

component of the WACC was calculated using the capital asset pricing model.


42

The impairment charges for investments were partly offset by a reversal of previously recognised impairment charges for subsidiaries, which ceased their operations but still earned income from investing activities. As a result of the recoverable value of these investments to the Company, the Company reversed impairment charges of Baht 505.9 million during the year ended 30 September 2014. Subsidiaries - TSS During the year ended 30 September 2013, TSS established a new subsidiary, Thoresen Shipping Denmark APS, with registered and paid-up share capital of DKK 80,000. Subsidiaries - Soleado On 4 September 2013, Soleado subscribed for 136,472,376 rights shares at a price of SGD 0.28 per rights share in MMPLC for total consideration of SGD 38.2 million, or Baht 964.9 million. On 26 September 2013, Soleado subsequently sold 89,917,033 MMPLC’s shares to the Company, for a total consideration of SGD 27.0 million, or Baht 681.1 million, for the purpose of internal reorganization.


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Not

es to

fina

ncia

l sta

tem

ents

43

Inve

stm

ents

in d

irect

ly o

wned

sub

sidi

arie

s of

the

Com

pany

as

at 3

0 Se

ptem

ber 2

014

and

2013

, and

div

iden

d in

com

e fro

m th

ose

inve

stm

ents

for

the

year

s th

en

ende

d, w

ere

as fo

llows

:

Sepa

rate

fina

ncia

l sta

tem

ents

Nam

e of

sub

sidi

arie

s Pa

id-u

p ca

pita

l

Cos

t

Impa

irmen

t

At c

ost -

net

Div

iden

d in

com

e

2014

2013

2014

2013

2014

2013

2014

2013

2014

2013

(in m

illion

Bah

t) D

irect

sub

sidi

arie

s

Sole

ado

Hol

ding

s Pt

e. L

td.

3,09

2

3,09

2

3,09

2

3,

092

-

-

3,09

2

3,

092

-

- At

hene

Hol

ding

s Lt

d.

100

10

0

100

100

(100

)

(100

)

-

-

-

- PM

Tho

rese

n As

ia H

oldi

ngs

Publ

ic C

ompa

ny L

imite

d 93

1

1

931

1

-

-

93

1

1

-

- Th

ores

en &

Com

pany

(Ban

gkok

) Lim

ited

125

12

5

-

-

-

-

-

-

-

- Pr

emo

Ship

ping

Pub

lic C

ompa

ny L

imite

d 7,

393

-

7,3

98

-

(2

)

- 7

,396

-

-

- Th

or D

ynam

ic S

hipp

ing

Co.

, Ltd

. -

36

0

-

360

-

-

-

360

10

-

Thor

End

eavo

ur S

hipp

ing

Co.

, Ltd

. -

1,

100

-

1,

100

-

(48)

-

1,05

2

-

-

Thor

Ene

rgy

Ship

ping

Co.

, Ltd

. -

1,

000

-

1,

000

-

(83)

-

917

-

- Th

or E

nter

pris

e Sh

ippi

ng C

o., L

td.

-

630

-

63

0

-

(2

6)

-

60

4

-

-

Thor

Har

mon

y Sh

ippi

ng C

o., L

td.

-

350

-

35

0

-

(1

41)

-

20

9

-

-

Thor

Inte

grity

Shi

ppin

g C

o., L

td.

-

385

-

38

5

-

-

-

38

5

5

-

Thor

Jup

iter S

hipp

ing

Co.

, Ltd

. -

97

-

97

-

-

-

97

111

-

Thor

Win

d Sh

ippi

ng C

o., L

td.

-

200

-

20

0

-

-

-

20

0

9

100

Thor

Wav

e Sh

ippi

ng C

o., L

td.

-

200

-

20

0

-

-

-

20

0

2

- Th

ores

en S

hipp

ing

Sing

apor

e Pt

e. L

td.

10,7

22

7,

123

10,

722

7,12

3

(4

98)

(4

98)

10,

224

6,

625

-

- Th

ores

en C

harte

ring

(HK)

Ltd

. 3

3

3

3

-

-

3

3

-

- Th

ores

en S

hipp

ing

Ger

man

y G

mbH

1

1

1

1

-

(1

)

1

-

-

- Th

or O

rchi

d Sh

ippi

ng C

o., L

td.

-

47

-

47

-

-

-

47

-

15

0 Th

or M

ercu

ry S

hipp

ing

Co.,

Ltd.

-

60

-

60

-

-

-

60

3

- Th

or M

arin

er S

hipp

ing

Co.

, Ltd

. -

35

-

39

-

-

-

39

32

-

Thor

Mer

chan

t Shi

ppin

g C

o., L

td.

-

20

-

20

-

-

-

20

48

- Th

or N

avig

ator

Shi

ppin

g C

o., L

td.

-

99

-

99

-

(15)

-

84

-

-

Thor

Cap

tain

Shi

ppin

g C

o., L

td.

-

153

-

15

3

-

-

-

15

3

5

-

Her

mes

Shi

ppin

g C

o., L

td.

-

27

-

27

-

-

-

27

2

-

Thor

Pilo

t Shi

ppin

g Co

., Lt

d.

-

80

-

80

-

-

-

80

4

-

Thor

Mas

ter S

hipp

ing

Co.

, Ltd

. -

18

8

-

188

-

-

-

188

6

- Th

or C

omm

ande

r Shi

ppin

g C

o., L

td.

-

115

-

11

5

-

-

-

11

5

6

-


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Not

es to

fina

ncia

l sta

tem

ents

44

Se

para

te fi

nanc

ial s

tate

men

ts

Nam

e of

sub

sidi

arie

s Pa

id-u

p ca

pita

l

Cos

t

Impa

irmen

t

At c

ost -

net

Div

iden

d in

com

e

2014

2013

2014

2013

2014

2013

2014

2013

2014

2013

(in m

illion

Bah

t) Th

or T

rans

porte

r Shi

ppin

g C

o., L

td.

-

200

-

20

0

-

-

-

20

0

8

- Th

or N

ereu

s Sh

ippi

ng C

o., L

td.

-

213

-

21

3

-

(9

6)

-

11

7

-

- H

erak

les

Ship

ping

Co.

, Ltd

. 2

2

1

1

(1

)

(1)

-

-

-

-

Her

on S

hipp

ing

Co.

, Ltd

. 1

1

1

1

-

-

1

1

-

-

Thor

Nec

tar S

hipp

ing

Co.,

Ltd.

-

25

4

-

254

-

(15)

-

239

-

- Th

or J

asm

ine

Ship

ping

Co.

, Ltd

. -

70

-

70

-

-

-

70

-

- Th

or C

ham

pion

Shi

ppin

g Co

., Lt

d.

-

75

-

75

-

-

-

75

4

-

Thor

Sta

r Shi

ppin

g C

o., L

td.

-

30

-

30

-

-

-

30

-

-

Thor

Ski

pper

Shi

ppin

g C

o., L

td.

-

30

-

30

-

-

-

30

5

-

Thor

Sai

lor S

hipp

ing

Co.

, Ltd

. -

30

-

30

-

-

-

30

2

- Th

or S

un S

hipp

ing

Co.

, Ltd

. -

40

-

40

-

-

-

40

16

-

Thor

Sky

Shi

ppin

g C

o., L

td.

-

40

-

40

-

-

-

40

4

-

Thor

Spi

rit S

hipp

ing

Co.,

Ltd.

-

40

-

40

-

-

-

40

-

- Th

or S

ea S

hipp

ing

Co.

, Ltd

. -

40

-

40

-

-

-

40

3

- Th

or L

otus

Shi

ppin

g C

o., L

td.

-

63

-

64

-

-

-

64

14

- Th

or T

rade

r Shi

ppin

g Co

., Lt

d.

-

45

-

45

-

-

-

45

3

-

Thor

Tra

velle

r Shi

ppin

g C

o., L

td.

-

45

-

45

-

-

-

45

3

-

Thor

Ven

ture

Shi

ppin

g C

o., L

td.

-

75

-

75

-

-

-

75

5

-

Thor

Triu

mph

Shi

ppin

g C

o., L

td.

-

60

-

60

-

-

-

60

4

-

Thor

Gua

rdia

n Sh

ippi

ng C

o., L

td.

-

75

-

75

-

-

-

75

5

-

Thor

Con

fiden

ce S

hipp

ing

Co.

, Ltd

. -

50

-

50

-

-

-

50

6

50

Thor

Nau

tica

Ship

ping

Co.

, Ltd

. -

75

-

75

-

(1

6)

-

59

-

- Th

or N

eptu

ne S

hipp

ing

Co.

, Ltd

. -

13

8

-

138

-

-

-

138

6

- Th

or N

exus

Shi

ppin

g C

o., L

td.

-

186

-

18

6

-

(2

9)

-

15

7

-

-

Thor

Trib

ute

Ship

ping

Co.

, Ltd

. -

11

7

-

117

-

-

-

117

6

-

Thor

Allia

nce

Ship

ping

Co.

, Ltd

. -

10

6

-

106

-

-

-

106

16

-

Thor

Nau

tilus

Shi

ppin

g C

o., L

td.

-

50

-

50

-

-

-

50

-

-

Thor

Tra

nsit

Ship

ping

Co.

, Ltd

. -

10

0

-

100

-

(36)

-

64

-

-

PT P

erus

ahaa

n Pe

laya

ran

Equi

nox

-

99

-

11

2

-

(5

3)

-

59

-

- Th

ores

en C

harte

ring

(Pte

) Ltd

. 2

2

2

2

-

-

2

2

-

-

ANNUAL REPORT 2014 127Consolidated and Company finanCial statementsTh

ores

en T

hai A

genc

ies

Publ

ic C

ompa

ny L

imite

d an

d its

Sub

sidi

arie

s N

otes

to fi

nanc

ial s

tate

men

ts

45

Se

para

te fi

nanc

ial s

tate

men

ts

Nam

e of

sub

sidi

arie

s Pa

id-u

p ca

pita

l

Cos

t

Impa

irmen

t

At c

ost -

net

Div

iden

d in

com

e

2014

2013

2014

2013

2014

2013

2014

2013

2014

2013

(in m

illion

Bah

t) Th

ores

en S

ervi

ce C

ente

r Ltd

. 35

35

35

35

(3

5)

(3

5)

-

-

-

-

Asia

Coa

ting

Serv

ices

Ltd

. 80

80

80

80

(1

)

(2)

79

78

-

-

Thor

esen

Shi

ppin

g FZ

E 7

7

7

7

-

-

7

7

-

-

Mer

mai

d M

ariti

me

Publ

ic C

ompa

ny L

imite

d 1,

413

1,

354

5,

889

4,39

7

-

-

5,

889

4,39

7

15

5

8 C

hidl

om M

arin

e Se

rvic

es &

Sup

plie

s Lt

d.

70

70

70

70

-

-

70

70

-

- G

AC T

hore

sen

Logi

stic

s Lt

d.

75

75

38

38

-

-

38

38

-

-

24,0

52

19,

563

28,

370

22,

461

(637

) (

1,19

5)

27,

733

21,

266

508

30

8


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Not

es to

fina

ncia

l sta

tem

ents

46

14

Inve

stm

ents

in a

ssoc

iate

s

Inve

stm

ents

in a

ssoc

iate

s as

at 3

0 Se

ptem

ber 2

014

and

2013

com

pris

e in

vest

men

ts in

the

follo

wing

com

pani

es:

Con

solid

ated

fina

ncia

l sta

tem

ents

N

ame

of a

ssoc

iate

s C

ost

Eq

uity

Impa

irmen

t

At e

quity

- ne

t

Div

iden

d in

com

e

2014

2013

2014

2013

2014

2013

2014

2013

2

014

201

3

(in m

illion

Bah

t)

Fe

arnl

eys

(Tha

ilarn

d) L

td.

18

18

60

59

-

-

60

59

-

- Th

ores

en S

hipp

ing

and

Logi

stic

s Lt

d.

24

24

34

35

-

-

34

35

10

7

Shar

jah

Ports

Ser

vice

s LL

C (i

nves

ted

by

Thor

esen

Shi

ppin

g FZ

E)

55

21

108

58

-

-

108

58

43

10

As

ia O

ffsho

re D

rillin

g Li

mite

d (in

vest

ed b

y MM

PLC)

2,

964

2,

964

4,

253

3,

149

-

-

4,

253

3,

149

-

-

Mer

ton

Gro

up (C

ypru

s) L

td. (

inve

sted

by

Sole

ado)

- *

235

- *

168

-

(1

20)

- *

48

-

-

Baria

Ser

ece

(inve

sted

by

Sole

ado)

33

4

334

40

6

383

-

-

40

6

383

12

11

3,

395

3,

596

4,

861

3,

852

-

(1

20)

4,

861

3,

732

65

28

* O

n 30

Sep

tem

ber

2014

, the

Com

pany

’s s

ubsi

diar

y ha

s en

tere

d in

to a

set

tlem

ent a

gree

men

t with

its

partn

ers

who

inve

sted

in M

erto

n G

roup

(Cyp

rus)

Ltd

. to

trans

fer i

ts 1

00%

ow

ners

hip

inte

rest

with

the

cons

ider

atio

n as

agr

eed.

The

sha

re tr

ansf

errin

g an

d se

ttlem

ent a

re in

pro

cess

and

pla

nned

to c

ompl

ete

this

trans

actio

n wi

thin

one

yea

r, ac

cord

ingl

y,

this

inve

stm

ent w

as re

class

ified

to a

sset

hel

d fo

r sal

e (n

ote

12).

Sepa

rate

fina

ncia

l sta

tem

ents

N

ame

of a

ssoc

iate

s

Cos

t

Impa

irmen

t

At c

ost -

net

Div

iden

d in

com

e

20

14

20

13

20

14

20

13

20

14

20

13

20

14

20

13

(in m

illion

Bah

t)

Fear

nley

s (T

haila

nd) L

td.

18

18

-

-

18

18

-

-

Thor

esen

Shi

ppin

g an

d Lo

gist

ics

Ltd.

24

24

-

-

24

24

10

7

42

42

-

-

42

42

10

7


47

The movements of investments in associates during the years ended 30 September 2014 and 2013 are as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht)

At 1 October 3,732,203 2,599,551 42,368 42,368 Additional investments 34,257 1,079,041 - - Dividends received (64,844) (28,235) - - Share of profits in associates 1,102,015 159,092 - - Impairment charges - (120,245) - - Reclassify to assets held for sale (39,471) - - - Translation adjustments 97,252 42,999 - - At 30 September 4,861,412 3,732,203 42,368 42,368 Significant additional investments of the Group during the year ended 30 September 2014 are as follows: Subsidiaries - Thoresen Shipping FZE On 31 July 2014, Thoresen Shipping FZE proportionately subscribed for 39,200 new ordinary shares of Sharjah Ports Services LLC at AED 100 each for a total investment of AED 3.92 million or Baht 34.26 million. The Group’s ownership in Sharjah Ports Services LLC remains the same at 49%. Impairment charge During the year ended 30 September 2013, impairment losses of Baht 120.2 million were recognised for investments in Merton Group (Cyprus) Ltd. to reflect their expected net recoverable amounts to the Group. The Group’s share of the result of its principal associates, and its share of the assets including goodwill and liabilities are as follows: 2014 Profits % Profit (loss) Assets Liabilities Revenues (losses) Interest sharing

Name Baht’000 Baht’000 Baht’000 Baht’000 held Baht’000 Thoresen Shipping and Logistics Ltd. 154,239 85,154 122,317 13,530 49.0 8,181 Baria Serece 1,163,510 182,043 488,165 176,958 20.0 35,392 Asia Offshore Drilling Limited 24,663,178 12,613,997 6,620,588 2,965,496 33.8 1,001,152 1,044,725 Add Others 57,290 1,102,015


48

2013 Profits % Profit (loss) Assets Liabilities Revenues (losses) Interest sharing

Name Baht’000 Baht’000 Baht’000 Baht’000 held Baht’000 Thoresen Shipping and Logistics Ltd. 151,748 79,352 169,633 20,908 49.0 10,245 Merton Group (Cyprus) Ltd. 404,173 18,199 8,289 (64,622) 26.2 (16,493) Baria Serece 1,098,287 234,068 548,561 122,529 20.0 24,506 Asia Offshore Drilling Limited 22,747,899 13,986,817 1,076,329 399,284 33.8 134,831 153,089 Add Others 6,003 159,092


ores

en T

hai A

genc

ies

Publ

ic C

ompa

ny L

imite

d an

d its

Sub

sidi

arie

s N

otes

to fi

nanc

ial s

tate

men

ts

49

15

Inve

stm

ents

in jo

int v

entu

res

Inve

stm

ents

in jo

int v

entu

res

as a

t 30

Sept

embe

r 201

4 an

d 20

13 c

ompr

ise

inve

stm

ents

in th

e fo

llowi

ng c

ompa

nies

:

Con

solid

ated

fina

ncia

l sta

tem

ents

N

ame

of jo

int v

entu

res

C

ost

Eq

uity

Impa

irmen

t

At e

quity

- ne

t

Div

iden

d in

com

e

20

14

20

13

20

14

20

13

20

14

20

13

20

14

20

13

20

14

20

13

(in m

illion

Bah

t) Th

ores

en (I

ndoc

hina

) S.A

.

9

9

122

10

4

-

-

122

10

4

-

- G

ulf A

genc

y C

ompa

ny (T

haila

nd) L

td.

11

11

9

11

-

-

9

11

-

-

Petro

lift In

c.(in

vest

ed b

y So

lead

o)

93

0

930

97

1

1,07

5

-

-

971

1,

075

17

3

71

Qin

g M

ei P

te. L

td. (

inve

sted

by

Sole

ado)

- *

12

8

- *

11

6

-

-

- *

11

6

-

- Za

mil M

erm

aid

Offs

hore

Ser

vices

Co.

(L

LC) (

inve

sted

by

MM

PLC

)

7

7

9

-

-

-

9

-

-

-

95

7

1,08

5

1,11

1

1,30

6

-

-

1,11

1

1,30

6

173

71

*

On

30 S

epte

mbe

r 20

14, t

he C

ompa

ny’s

sub

sidi

ary

has

ente

red

into

set

tlem

ent a

gree

men

t with

its

partn

ers

who

inve

sted

in Q

ing

Mei

Pte

. Ltd

. to

trans

fer i

ts 1

00%

own

ersh

ip

inte

rest

with

the

cons

ider

atio

n as

agr

eed.

The

sha

re tr

ansf

errin

g an

d se

ttlem

ent a

re in

pro

cess

and

pla

nned

to c

ompl

ete

this

trans

actio

n wi

thin

one

yea

r, ac

cord

ingl

y, th

is in

vest

men

t was

recla

ssifie

d to

ass

et h

eld

for s

ale

(not

e 12

).

Sepa

rate

fina

ncia

l sta

tem

ents

N

ame

of jo

int v

entu

res

C

ost

Im

pairm

ent

At

cos

t - n

et

D

ivid

end

inco

me

2014

2013

2014

2013

2

014

20

13

20

14

20

13

(in m

illion

Bah

t) G

ulf A

genc

y C

ompa

ny (T

haila

nd) L

td.

11

11

(2

)

-

9

11

-

- Th

ores

en (I

ndoc

hina

) S.A

.

9

9

-

-

9

9

-

-

20

20

(2

)

-

18

20

-

-


50

The movements of investments in joint ventures during the years ended 30 September 2014 and 2013 are as follows: Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) At 1 October 1,306,463 1,256,472 19,781 19,984 Additional investments - 43,187 - - Dividends received (173,075) (70,733) - - Share of profits in joint ventures 84,076 95,570 - - Impairment charges - - (1,813) (203) Reclassify to assets held for sale (109,946) - - - Translation adjustments 3,100 (18,033) - - At 30 September 1,110,618 1,306,463 17,968 19,781 Significant additional investments of the Group during the year ended 30 September 2013 are as follows: Subsidiaries - Soleado During the year ended 30 September 2013, Soleado, together with Merton Group (Cyprus) Limited, an associate, and Britmar (Asia) Pte. Ltd., a business partner, subscribed for an additional 1,200,000 ordinary shares of Qing Mei at a total purchase price of USD 1,200,000, or Baht 36.6 million each. The Group’s share of the result of its principal joint ventures, and its share of assets including goodwill and liabilities are as follows:

2014 % Profit

(loss) Assets Liabilities Revenues Profits Interest sharing

Name Baht’000 Baht’000 Baht’000 Baht’000 held Baht’000 Thoresen (Indochina) S.A. 238,678 1,419 632,101 31,075 50.0 18,828 Petrolift Inc. 3,439,244 1,612,973 1,050,704 171,173 40.0 58,587 77,415 Add Others 6,661 84,076

2014 % Profit

(loss) Assets Liabilities Revenues Profits Interest sharing

Name Baht’000 Baht’000 Baht’000 Baht’000 held Baht’000 Thoresen (Indochina) S.A. 210,611 10,877 335,970 35,601 50.0 17,801 Petrolift Inc. 3,776,373 1,851,611 1,093,846 229,889 40.0 91,955 109,756 Add Others (14,186) 95,570


51

16 Goodwill The movements of goodwill during the years ended 30 September 2014 and 2013 are as follows:

Consolidated

financial statements 2014 2013

(in thousand Baht) Opening net book value 968,661 1,478,996 Impairment charges - (516,031) Translation adjustments 9,959 5,696 Closing net book value 978,620 968,661

Goodwill is allocated to the Group’s cash-generating units (“CGU”) identified according to business segment. A segment-level summary of the goodwill allocation is presented as follows:

Energy business

Infrastructure business Total

(in thousand Baht) Goodwill allocation 978,620 2,834,697 3,813,317 Less Impairment charge - (2,834,697) (2,834,697) Net 978,620 - 978,620 During the year ended 30 September 2013, UMS and its subsidiaries (“the UMS Group”) incurred a net loss of Baht 375.5 million and as of 30 September 2013, the UMS Group’s current liabilities exceeded current assets by Baht 555.2 million. Moreover, the UMS Group had breached certain loan covenants according to the requirements in loan agreements with financial institutions. These factors may cast doubt about the recoverable amounts from the UMS Group. As a result, during the year ended 30 September 2013, the Company recognised an additional impairment charge on goodwill and customer relationship of Baht 516.0 million and Baht 79.8 million, respectively. The calculation of value-in-use was performed using income approach which is based on projected free cash flows covering the next five years according to UMS’s strategic plan approved by its Board of Directors. Cash flows beyond the five-year period are extrapolated using the estimated nil growth rate and a discount rate of 15% which is UMS’s weighted average cost of capital


Thor

esen

Tha

i Age

ncie

s Pu

blic

Com

pany

Lim

ited

and

its S

ubsi

diar

ies

Not

es to

fina

ncia

l sta

tem

ents

52

17

Prop

erty

, pla

nt, a

nd e

quip

men

t

Co

nsol

idat

ed fi

nanc

ial s

tate

men

ts

Fu

rnitu

re,

Oce

an v

esse

ls,

fixt

ures

,

Build

ings

su

ppor

t ves

sels,

m

achi

nery

,

and

Bu

ildin

g su

pply

vess

els,

and

M

otor

Mot

or

Cons

truct

ion

La

nd

fa

ctor

ies

impr

ovem

ents

an

d te

nder

rigs

Dr

y-do

ckin

g eq

uipm

ent

ve

hicl

es

lau

nche

s

Barg

es

in p

rogr

ess

To

tal

(in

thou

sand

Bah

t) Co

st

At

1 O

ctob

er 2

012

60

8,87

1 1

,258

,149

192,

537

25,

099,

395

94

8,43

8 3

,448

,003

118,

867

2,

185

13

9,90

7

2,87

9,38

6 34

,695

,738

Ad

ditio

ns

-

1,18

4

9,22

9

507,

951

78

1,29

5

175,

829

19

,511

24,6

01

55

906,

346

2,4

26,0

01

Tran

sfer

s -

13

3,30

2

1,28

4

2,36

0,74

5

33,2

77

61

1,27

8

1,51

1

-

- (

3,14

1,39

7)

-

Disp

osal

s an

d wr

ite-o

ffs

(2,5

34)

(6

,427

)

(3,1

36)

(1

,975

,491

)

(92,

022)

(

361,

236)

(1,9

90)

-

-

(4

38,2

43)

(2,8

81,0

79)

Effe

ct o

f mov

emen

t

in

exc

hang

e ra

tes

471

11

,271

(1,0

93)

69

5,08

8

35,0

19

43

,280

3,40

6

789

41

2

210

78

8,85

3 At

30

Sept

embe

r 201

3 an

d

1 O

ctob

er 2

013

60

6,80

8 1

,397

,479

198,

821

26,

687,

688

1,7

06,0

07

3,9

17,1

54

14

1,30

5

27,5

75

14

0,37

4

206,

302

35,0

29,5

13

Addi

tions

-

35

0

1,27

1

4,34

3,35

7

187,

540

19

6,08

9

29,6

33

1,

634

-

2,

416,

373

7,1

76,2

47

Tran

sfer

-

4,

830

50

-

-

233,

926

2,

615

2,

958

-

(2

44,3

79)

-

Disp

osal

s an

d wr

ite-o

ffs

-

(10,

462)

(5,6

59)

(2

5)

(36

1,73

2)

(6

2,66

6)

(7

,624

)

-

-

-

(448

,168

) De

cons

olid

atio

n -

-

(4

,579

)

80,2

19

-

(1

0,04

5)

(1

,076

)

-

-

-

64,5

19

Effe

ct o

f mov

emen

t

in

exc

hang

e ra

tes

824

41

,130

1,15

1

767,

645

-

93

,158

(613

)

882

-

12

,325

916,

502

At 3

0 Se

ptem

ber 2

014

607,

632

1,4

33,3

27

19

1,05

5 3

1,87

8,88

4 1

,531

,815

4

,367

,616

164,

240

33

,049

140,

374

2,

390,

621

42,7

38,6

13


ores

en T

hai A

genc

ies

Publ

ic C

ompa

ny L

imite

d an

d its

Sub

sidi

arie

s N

otes

to fi

nanc

ial s

tate

men

ts

53

Co

nsol

idat

ed fi

nanc

ial s

tate

men

ts

Fu

rnitu

re,

Oce

an v

esse

ls,

fixt

ures

,

Build

ings

su

ppor

t ves

sels,

m

achi

nery

,

and

Bu

ildin

g su

pply

vess

els,

and

M

otor

Mot

or

Cons

truct

ion

La

nd

fa

ctor

ies

impr

ovem

ents

an

d te

nder

rigs

Dr

y-do

ckin

g eq

uipm

ent

ve

hicl

es

lau

nche

s

Barg

es

in p

rogr

ess

To

tal

(in

thou

sand

Bah

t) De

prec

iatio

n an

d im

pairm

ent

ch

arge

s

At 1

Oct

ober

201

2

-

435,

747

12

3,75

4

6,88

1,70

2

631,

273

1,7

66,8

14

75

,821

1,41

8

39,2

37

75

5,43

5 10

,711

,201

De

prec

iatio

n ch

arge

for t

he

year

-

66

,172

17,2

17

1,

024,

206

27

0,22

1

355,

121

15

,111

3,91

3

2,72

1

- 1,

754,

682

Impa

irmen

t cha

rges

, net

-

-

-

4,

210,

943

-

(8

,102

)

-

-

3,58

2

(746

,756

) 3

,459

,667

Di

spos

als

and

write

-offs

-

(3

,738

)

(3,1

36)

(1

,842

,550

)

(79,

185)

(

161,

135)

1,26

0

-

-

- (2

,088

,484

) Ef

fect

of m

ovem

ent

in e

xcha

nge

rate

s -

2,

302

(1

,145

)

230,

418

14

,810

19,3

12

33

7

145

41

0

(8,6

79)

25

7,91

0 At

30

Sept

embe

r 201

3 an

d

1 O

ctob

er 2

013

-

50

0,48

3

136,

690

10,

504,

719

83

7,11

9 1

,972

,010

92,5

29

5,

476

45

,950

- 14

,094

,976

De

prec

iatio

n ch

arge

for t

he

year

-

72

,930

17,4

97

94

8,89

7

324,

877

37

9,34

6

17,5

46

5,

867

1,

323

-

1,76

8,28

3

Impa

irmen

t cha

rges

, net

-

-

-

-

-

12

,047

-

-

-

6,40

6

18,4

53

Reve

rse

impa

irmen

t cha

rges

-

-

-

-

-

(3

,515

)

-

-

-

-

(3,5

15)

Disp

osal

s an

d wr

ite-o

ffs

-

(10,

494)

(5,6

27)

(2

5)

(36

1,73

2)

(5

9,67

4)

(7

,575

)

-

-

-

(445

,127

) De

cons

olid

atio

n

-

-

(3,5

14)

80

,219

-

(9,1

34)

(7

80)

-

-

-

66

,791

Ef

fect

of m

ovem

ent

in e

xcha

nge

rate

s -

1,

966

79

3

299,

585

(2

6,59

6)

39

,702

(1,1

30)

19

6

-

-

314,

516

At 3

0 Se

ptem

ber 2

014

-

564,

885

14

5,83

9 1

1,83

3,39

5

773,

668

2,3

30,7

82

10

0,59

0

11,5

39

47

,273

6,40

6 15

,814

,377

Ne

t boo

k va

lue

At

1 O

ctob

er 2

012

60

8,87

1

822,

402

68

,783

1

8,21

7,69

3

317,

165

1,6

81,1

89

43

,046

767

10

0,67

0

2,12

3,95

1 23

,984

,537

At

30

Sept

embe

r 201

3 an

d

1 O

ctob

er 2

013

60

6,80

8

896,

996

62

,131

1

6,18

2,96

9

868,

888

1,9

45,1

44

48

,776

22,0

99

94

,424

206,

302

20,9

34,5

37

At 3

0 Se

ptem

ber 2

014

607,

632

86

8,44

2

45,2

16

20,

045,

489

75

8,14

7 2

,036

,834

63,6

50

21

,510

93,1

01

2,

384,

215

26,9

24,2

36


54

Separate financial statements Furniture, Building fixtures, and Motor Land Buildings improvements equipment vehicles Total (in thousand Baht) Cost At 1 October 2012 82,847 201,846 90,547 67,695 2,806 445,741 Additions 17,100 1,900 1,416 1,491 - 21,907 At 30 September 2013 and 1 October 2013 99,947 203,746 91,963 69,186 2,806 467,648 Additions - - 213 1,158 - 1,371 At 30 September 2014 99,947 203,746 92,176 70,344 2,806 469,019 Depreciation At 1 October 2012 - 120,411 67,476 51,090 2,580 241,557 Depreciation charge for the year - 9,303 6,412 11,626 226 27,567 At 30 September 2013 and 1 October 2013 - 129,714 73,888 62,716 2,806 269,124 Depreciation charge for the year - 9,395 5,368 2,728 - 17,491 At 30 September 2014 - 139,109 79,256 65,444 2,806 286,615 Net book value At 1 October 2012 82,847 81,435 23,071 16,605 226 204,184 At 30 September 2013 and 1 October 2013 99,947 74,032 18,075 6,470 - 198,524 At 30 September 2014 99,947 64,637 12,920 4,900 - 182,404 Significant movement of property, plant, and equipment of the Group during the year ended 30 September 2014 is as follows: Significant additions, disposals, and write-offs: - Significant additions during the year ended 30 September 2014 were i) final instalment payment for new build

ocean vessels, ii) payments for dry-docking of vessels and drilling rigs, iii) payments for a second-hand ocean vessel, iv) payments for support vessels and rig equipment, and progress payments for new equipment under construction and installation, and v) payments for warehouse construction.

- Significant disposals and write-offs during the year ended 30 September 2014 were i) disposals of an ocean

vessel and a remotely operated vehicle and ii) termination of vessel main engine contract. Impairment evaluation As at 30 September 2014, additional impairment on the existing vessels is not required. In assessing the indicators of further potential impairment, internal and external source of information such as market demand and general market conditions are considered. During the year ended 30 September 2013, the Company’s subsidiaries recognised an impairment charge of USD 123.5 million (equivalent to Baht 3,916.9 million) on certain of their vessels as a result of lower recoverable amounts of vessels. By a result of the prolonged downturn and resultant low freight rates in the dry bulk industry in 2013.


55

The recoverable amounts of the vessels were determined based on higher of value-in-use and fair value less costs to sell. The fair value was determined based on the vessel valuation report obtained from an accredited ship broker. The value-in-use was determined using an income approach based on cash flow projection of each vessel assisted by an independent appraiser. Management determined the budgeted cash flows based on past performance and its expectations of market development. Cash inflows are based on existing charter contracts and management’s best estimate of the average charter rates over the next 5 years using third party advisors and extrapolated by using nil growth rate. Cash outflows are estimated i) by using the most recently approved budget and extrapolated by using nil growth rate for the operating expenses and ii) by using the approved dry-docking plan for capital expenditure based on the historical experiences. A weighted average cost of capital (“WACC”) of 8.0% was used as the discount rate in the value in use calculation. The cost of the equity component was derived using the capital asset pricing model. Property, plant, and equipment as of 30 September 2014 and 2013 used as collateral for loan facilities can be summarised as follows: Ocean vessels with a net book value of USD 247.3 million (30 September 2013: USD 193.9 million) are

mortgaged with financial institutions as collateral for their loans at a total value of USD 131.8 million (30 September 2013: USD 104.0 million).

Subsea vessels and tender rig with a net book value of USD 201.7 million (30 September 2013 : USD 211.2

million ) were mortgaged with various banks as collateral for bank overdraft and loan facilities for a total value of Baht 1,129.5 million and USD 110.0 million (30 September 2013: Baht 1,129.5 million and USD 110.0 million).

Barges with a net book value of Baht 123.1 million (30 September 2013: Baht 127.7 million) are mortgaged with a

bank as collateral for its bank overdrafts and long-term loans for a total value of Baht 125.0 million (30 September 2013: Baht 125.0 million).

Certain land, buildings and machinery of the Group with a net book value of Baht 602.8 million, USD 2.6

million and VND 81,359 million respectively, (30 September 2013: Baht 607.7 million, USD 2.9 million and VND 48,769 million) are mortgaged with various banks as collateral for loan facilities, bank overdraft facilities, and letters of guarantee for a total value of Baht 905.0 million and USD 7.0 million (30 September 2013: Baht 900.0 million and VND 117,575 million).


56

18 Intangible assets

Consolidated financial statements

Customer

relationship

Other

intangible assets

Computer software

Computer software

under installation Total

(in thousand Baht) Cost At 1 October 2012 563,851 8,256 336,802 6,095 915,004 Additions - - 9,391 - 9,391 Disposals and write-offs - - (26,607) - (26,607) Effect of movement in exchange rates - - 3,320 - 3,320 At 30 September 2013 and 1 October 2013 563,851 8,256 322,906 6,095 901,108 Additions - - 18,970 - 18,970 Disposals and write-offs - - (5,156) - (5,156) Effect of movement in exchange rates - - 3,294 - 3,294 At 30 September 2014 563,851 8,256 340,014 6,095 918,216 Amortisation At 1 October 2012 204,904 3,526 209,068 - 417,498 Amortisation charge for the year 69,897 1,082 39,768 - 110,747 Impairment charges 79,839 - - - 79,839 Disposals and write-offs - - (26,607) - (26,607) Effect of movement in exchange rates 87 31 3,085 - 3,203 At 30 September 2013 and 1 October 2013 354,727 4,639 225,314 - 584,680 Amortisation charge for the year 51,249 1,126 38,483 - 90,858 Disposals and write-offs - - (4,775) - (4,775) Effect of movement in exchange rates (35) (12) 942 - 895 At 30 September 2014 405,941 5,753 259,964 - 671,658 Net book value At 1 October 2012 358,947 4,730 127,734 6,095 497,506 At 30 September 2013 and 1 October 2013 209,124 3,617 97,592 6,095 316,428 At 30 September 2014 157,910 2,503 80,050 6,095 246,558


57

Separate financial statements Computer

software Computer software under installation Total

(in thousand Baht) Cost At 1 October 2012 185,993 6,095 192,088 Additions 383 - 383 At 30 September 2013 and 1 October 2013 186,376 6,095 192,471 Additions - - - At 30 September 2014 186,376 6,095 192,471 Amortisation At 1 October 2012 101,349 - 101,349 Amortisation charge for the year 21,545 - 21,545 At 30 September 2013 and 1 October 2013 122,894 - 122,894 Amortisation charge for the year 16,181 - 16,181 At 30 September 2014 139,075 - 139,075 Net book value At 1 October 2012 84,644 6,095 90,739 At 30 September 2013 and 1 October 2013 63,482 6,095 69,577 At 30 September 2014 47,301 6,095 53,396


58

19 Deferred tax

Deferred tax assets and liabilities as at 30 September 2014 and 2013 were attributable to the following: Consolidated financial statements Assets Liabilities Net

2014 2013 2014 2013 2014 2013 (in thousand Baht) Short-term investments 1,942 3,569 - - 1,942 3,569 Trade accounts receivables 6,281 14,043 - - 6,281 14,043 Property, plant, and equipment 28 3,179 (93,941) (88,408) (93,913) (85,229) Intangible assets - - (69,363) (86,842) (69,363) (86,842) Employee benefit obligations 13,459 9,275 - - 13,459 9,275 Loss carry forward 125,990 166,675 - - 125,990 166,675 Others 31,935 17,128 (2,005) (1,897) 29,930 15,231 Total 179,635 213,869 (165,309) (177,147) 14,326 36,722 Set off of tax (1,552) (822) 1,552 822 - - Net deferred tax assets (liabilities) 178,083 213,047 (163,757) (176,325) 14,326 36,722

Separate financial statements Assets Liabilities Net

2014 2013 2014 2013 2014 2013 (in thousand Baht) Short-term investments 1,942 3,569 - - 1,942 3,569 Intangible assets - - (1,067) (3,180) (1,067) (3,180) Employee benefit obligations 2,468 2,224 - - 2,468 2,224 Loss carry forward 66,221 58,928 - - 66,221 58,928 Others 10,711 4,352 - - 10,711 4,352 Total 81,342 69,073 (1,067) (3,180) 80,275 65,893 Set off of tax (1,067) (3,180) 1,067 3,180 - - Net deferred tax assets 80,275 65,893 - - 80,275 65,893


ores

en T

hai A

genc

ies

Publ

ic C

ompa

ny L

imite

d an

d its

Sub

sidi

arie

s N

otes

to fi

nanc

ial s

tate

men

ts

59

Mov

emen

ts in

tota

l def

erre

d ta

x as

sets

and

liab

ilitie

s du

ring

the

year

s en

ded

30 S

epte

mbe

r 201

4 an

d 20

13 w

ere

as fo

llows

:

C

onso

lidat

ed fi

nanc

ial s

tate

men

ts

C

harg

ed /

(cre

dite

d to

:)

At

O

ther

At

1

Oct

ober

Com

preh

ensi

ve

Ex

chan

ge

D

econ

solid

atio

n

30 S

epte

mbe

r

2013

Prof

it or

loss

inco

me

di

ffere

nces

of a

sub

sidi

ary

20

14

(in

thou

sand

Bah

t) Sh

ort-t

erm

inve

stm

ents

3,

569

-

(1

,627

)

-

-

1,94

2 Tr

ade

acco

unts

rece

ivab

les

14,0

43

(1

,134

)

-

-

(6,6

28)

6,

281

Prop

erty

, pla

nt, a

nd e

quip

men

t (8

5,22

9)

(8

,689

)

-

5

-

(93,

913)

In

tang

ible

ass

ets

(86,

842)

17,4

80

-

(1

)

-

(69,

363)

Em

ploy

ee b

enef

it ob

ligat

ions

9,

275

4,

184

-

-

-

13

,459

Lo

ss c

arry

forw

ard

166,

675

(4

0,39

5)

-

(2

90)

-

12

5,99

0 O

ther

s 15

,231

14,7

04

-

(5

)

-

29,9

30

Tota

l 36

,722

(13,

850)

(1,6

27)

(2

91)

(6

,628

)

14,3

26

Con

solid

ated

fina

ncia

l sta

tem

ents

Cha

rged

/ (c

redi

ted

to:)

At

Oth

er

At

1 O

ctob

er

co

mpr

ehen

sive

Exch

ange

Dec

onso

lidat

ion

30

Sep

tem

ber

20

12

Pr

ofit

or lo

ss

in

com

e

diffe

renc

es

of

a s

ubsi

diar

y

2013

(in th

ousa

nd B

aht)

Shor

t-ter

m in

vest

men

ts

2,78

7

-

782

-

-

3,

569

Trad

e ac

coun

ts re

ceiv

able

s 13

,420

1,96

2

-

(1,3

39)

-

14

,043

Pr

oper

ty, p

lant

, and

equ

ipm

ent

(72,

049)

(13,

101)

-

(79)

-

(85,

229)

In

tang

ible

ass

ets

(107

,531

)

20,6

83

-

6

-

(8

6,84

2)

Empl

oyee

ben

efit

oblig

atio

ns

10,9

72

(1

,697

)

-

-

-

9,27

5 Lo

ss c

arry

forw

ard

197,

074

(3

0,68

9)

-

29

0

-

166,

675

Oth

ers

14,5

70

66

1

-

-

-

15,2

31

Tota

l 59

,243

(22,

181)

782

(1

,122

)

-

36,7

22


60

Separate financial statements Charged / (credited to):

At 1 October

2013

Profit or loss

Other comprehensive

income

At 30 September

2014 (in thousand Baht)

Short-term investments 3,569 - (1,627) 1,942 Intangible assets (3,180) 2,113 - (1,067) Employee benefit obligations 2,224 244 - 2,468 Loss carry forward 58,928 7,293 - 66,221 Others 4,352 6,359 - 10,711 Total 65,893 16,009 (1,627) 80,275

Separate financial statements Charged / (credited to):

At 1 October

2012

Profit or loss

Other comprehensive

income

At 30 September

2013 (in thousand Baht)

Short-term investments 2,787 - 782 3,569 Intangible assets (2,995) (185) - (3,180) Employee benefit obligations 4,074 (1,850) - 2,224 Loss carry forward 35,440 23,488 - 58,928 Others 2,000 2,352 - 4,352 Total 41,306 23,805 782 65,893 Deferred tax assets arising from temporary differences and unused tax losses that have not been recognised in the financial statements were as follows:


Separate financial statements

30 September

2014

30 September

2013

30 September

2014

30 September

2013 (in thousand Baht) Deductible temporary differences 1,511,412 1,357,637 775,497 785,480 Unused tax losses 286,086 546,328 - - Total 1,797,498 1,903,965 775,497 785,480

The tax losses will expire in 2014-2021. The deductible temporary differences do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Group and the Company can utilise the benefits there from.


61

20 Other non-current assets Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Long-term prepayment - land use rights, net 2,250 5,821 - - Insurance claims 252,153 265,443 - - Restricted deposit at a financial institution over 1 year 129,533 125,588 - - Other assets 61,570 74,650 511 698 Total 445,506 471,502 511 698 The restricted deposit at a financial institution, which matures over one year from now, is pledged against long-term loans with a local financial institution. The restricted deposit must be maintained at a minimum amount of the next two principal and interest payments after the two-year grace period expired on 30 September 2013.

21 Interest-bearing liabilities Consolidated Separate financial statements financial statements Note 2014 2013 2014 2013 (in thousand Baht) Current Bank overdrafts 4,244 12,140 - - Short-term loans 284,044 1,168,349 - - Short-term loan from related parties 5 - - 5,816,657 5,916,004 Current portion of long-term loans 2,272,635 2,279,612 360,000 220,000 Current portion of bonds 1,999,445 - 1,999,445 - Current portion of finance lease liabilities 6,264 4,239 - - 4,566,632 3,464,340 8,176,102 6,136,004 Non-current Long-term loans 7,156,341 6,627,589 580,000 940,000 Bonds 1,998,569 3,996,772 1,998,569 3,996,772 Finance lease liabilities 9,186 9,604 - - 9,164,096 10,633,965 2,578,569 4,936,772 Total 13,730,728 14,098,305 10,754,671 11,072,776


62

The periods to maturity of long-term loans as at 30 September were as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Within one year 2,272,635 2,279,612 360,000 220,000 After one year but within five years 4,560,242 4,408,361 580,000 940,000 After five years 2,596,099 2,219,228 - - Total 9,428,976 8,907,201 940,000 1,160,000

The currency denomination of long-term loans as at 30 September were as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Thai Baht (THB) 1,355,654 1,365,899 940,000 1,160,000 United States Dollars (USD) 8,073,322 7,427,532 - - Qatar Riyal (QAR) - 113,770 - - Total 9,428,976 8,907,201 940,000 1,160,000 The Company Long-term loans Loan for convertible bond redemption was granted by a local commercial bank and is denominated in Thai Baht with a total outstanding balance of Baht 940 million as at 30 September 2014 (2013: Baht 1,160 million) with repayment term within 5 years and is unsecured. The loan bears interest rate at a floating reference rate plus a margin. Bonds In July 2010, the Company issued and sold two tranches of unsubordinated and unsecured Thai Baht bonds at face value worth Baht 4 billion. The details of bonds are as follows: Bond No.

Number of units

Face value /unit (Baht)

Interest rate (% per annum)

Maturity dated

Tranche 1 2,000,000 1,000 3.60 9 July 2015 Tranche 2 2,000,000 1,000 3.82 29 June 2017 The Thai Baht bonds were issued at par with a face value of Baht 1,000 per unit. The term of the first tranche is five years from issue date and the term of the second tranche is six years, eleven months and twenty days from the issue date. The Company will pay interest every three months and will pay the entire principal amount at the maturity date. The first tranch with net book value of Baht 1,999.4 million was reclassified to current portion as of 30 September 2014 based on its maturity date.


63

The movement of bonds during the year ended 30 September 2014 and 2013 are as follows:

Consolidated and Separate financial statements

2014 2013 (in thousand Baht)

At 1 October 3,996,772 3,995,530 Amortisation on deferred issuing costs 1,242 1,242 At 30 September 3,998,014 3,996,772 Consolidated Short-term loans As at 30 September 2014, the Group has unsecured short-term loans in form of promissory notes, bill of exchanges, and trust receipts from local financial institutions amounting to Baht 284.0 million (2013: Baht 1,168.3 million). Long-term loans Movements of long-term loans during the years ended 30 September 2014 and 2013 are as follows:

Consolidated Separate financial financial statements statements

2014 2013 2014 2013 (in thousand Baht) At 1 October 8,907,201 8,706,255 1,160,000 1,200,000 Additions 1,525,219 1,037,951 - - Repayments (1,448,891) (973,064) (220,000) (40,000) Reclassify from short-term loan 202,676 - - - Realised gains on exchange rates 12 - - - Unrealised gains on exchange rates 700 - - - Translation adjustments 238,099 132,442 - - Amortisation on deferred issuing costs 3,960 3,617 - - At 30 September 9,428,976 8,907,201 940,000 1,160,000 Less current portion of long-term loans (2,272,635) (2,279,612) (360,000) (220,000) Long-term loans - net of current portion 7,156,341 6,627,589 580,000 940,000 a) Loans for the purchases and constructions of ocean vessels, a tender rig, support vessels and equipment, and

barges:

- Loans for the purchase and construction of ocean vessels are granted by foreign syndicated banks and are denominated in US Dollars with a total outstanding balance of USD 131.5 million as at 30 September 2014 (2013: USD 103.6 million) with repayment terms within 5 - 17 years from the vessel delivery date. As at 30 September 2014, interest rates and securities on the loans are as follows:

- The loan balance of USD 28.8 million (2013: USD 32.3 million): fixed rate and LIBOR plus a

certain margin and is secured by a mortgage of two vessels and a corporate guarantee by the Company.


64

- The loan balance of USD 102.7 million (2013: USD 71.3 million): LIBOR plus a certain margin and is secured by a mortgage of twelve of the Group’s ocean vessels and subsequently by the new build or second-hand vessels that have been acquired under these loans facilities, assignment of insurance for the collateral vessels, pledge or charge over bank accounts, and a corporate guarantee by the Company.

- Loan for the purchase of a tender rig granted by a local commercial bank and is denominated in US Dollars

with a total outstanding balance of USD 2.7 million as at 30 September 2013 with repayment term within 9 years. This loan beared interest at the rate of USD-LIBOR plus a certain margin, secured by a mortgage of the tender rig, and guaranteed by subsidiaries. The loan was repaid in full during the year ended 30 September 2014.

- Loan for the special maintenance of a tender rig is granted by a local commercial bank and is

denominated in US Dollars with a total outstanding balance of USD 3.0 million as at 30 September 2014 (2013: USD 9.0 million) with repayment term within 2 years. This loan bears interest at the rate of USD-LIBOR plus a certain margin, is secured by a mortgage of the tender rig, and is guaranteed by subsidiaries.

- Loans for the purchase of support vessels and equipment are granted by local commercial banks and

are denominated in US Dollars, having a total outstanding balance of USD 115.1 million as at 30 September 2014 (2013: USD 122.1 million) with repayment terms within 8 - 10 years. As at 30 September 2014, the interest rate is USD-LIBOR plus a certain margin (2013: USD-LIBOR plus a certain margin). These loans are currently secured by mortgages of support vessels and are guaranteed by a subsidiary.

- Loans for working capital granted by a foreign commercial bank and denominated in Qatar Riyal,

having a total outstanding balance of QAR 13.2 million as at 30 September 2013 with repayment terms within 1.3 years. As at 30 September 2013, interest rate fixed. These loans guaranteed by a subsidiary. The loans were repaid in full during the year ended 30 September 2014.

- Loans for the purchase of barges are granted by a local commercial bank and are denominated in

Thai Baht with a total outstanding balance of Baht 9.4 million as at 30 September 2014 (2013: Baht 21.4 million) with repayment term within 7 years. This loan bears interest at MLR minus certain margins and is secured by a mortgage of all barges.

According to a condition of the loan agreements, the Company and its subsidiaries are not allowed to

create any encumbrance on the assets which are used as collateral, except obtaining prior consent of the banks and permitted liens. The Company and its subsidiaries must comply with other conditions and restrictions stated in the term loan agreements.

b) Loans for the construction of a building and warehouse are granted by local commercial banks and are

denominated in Thai Baht with a total outstanding balance of Baht 50.4 million as at 30 September 2014 (2013: Baht 72.7 million) and repayment terms within 6.5 - 8 years. As at 30 September 2014, interest rates and the detail of mortgages are as follows: - The loan balance of Baht 50.4 million (2013: Baht 65.9 million): MLR minus a certain margin. The

loans are secured by mortgages of the subsidiary’s land & buildings and are guaranteed by the Company.

- The loan balance of Baht 6.8 million in 2013: the one year fixed deposit rate for personal account plus

a certain margin. The loans secured by mortgages of the subsidiary’s land & buildings and guaranteed by the Company. The loan was repaid in full during the year ended 30 September 2014.


65

c) Loans for the construction of machinery and warehouses and working capital are granted by local commercial banks and are denominated in Thai Baht with a total outstanding balance of Baht 355.9 million as at 30 September 2014 (2013: Baht 111.8 million) and repayment terms within 3 - 7 years. These loans bear interest at MLR minus certain margins and are secured by mortgages of a subsidiary’s partial land and construction on that land.

As at 30 September 2014, the Company as a guarantor for loans undertaken by subsidiaries, and the Company and UMS as the borrowers had breached certain loan covenants. According to Thai Accounting Standard No. 1 (Revised 2009) - Presentation of Financial Statements, the entity has to present the liability as current if an entity has breached an undertaking under a long-term loan agreement on or before the reporting date, even if the lender has agreed, after the reporting date and before the authorisation of the financial statements for issue, not to demand payment as a consequence of the breach. As a result, the long-term portion of loans amounting to Baht 844.64 million was presented as current liabilities as of 30 September 2014. Currently, management is discussing with the relevant banks and has the opinion that the outcome will not result in a material adverse effect.

22 Employee benefit obligations Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Employee benefit obligations 111,663 108,640 12,343 11,121 Charge to statement of income 11,121 19,845 3,026 (8,798) Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Statements of financial position obligations for: Retirement benefits 111,663 108,640 12,343 11,121 Retirement benefits The movement in the defined benefit obligations during the year is as follows: Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Beginning balance 108,640 100,473 11,121 20,371 Deconsolidation (5,738) - - - Current service costs 26,824 32,421 3,404 2,833 Interest costs 1,929 1,910 307 302 Actuarial gains (17,632) - (685) - Curtailment gains - (14,486) - (11,933) Benefits paid (4,160) (8,430) (1,804) (452) Translation adjustment 1,800 (3,248) - - Ending balance 111,663 108,640 12,343 11,121


66

The amounts recognised in the statement of income are as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Current service costs 26,824 32,421 3,404 2,833 Interest costs 1,929 1,910 307 302 Amortisation of actuarial gains (17,632) - (685) - Curtailment gains - (14,486) - (11,933) Total (included in staff costs) 11,121 19,845 3,026 (8,798)

These amounts are included in service, selling, and administrative expenses.

The principal actuarial assumptions used were as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 Discount rate 2.1% - 3.8% 3.7% - 4.3% 3.47% 3.8% Future salary increases 4% - 8% 4% - 6% 6% 6% Mortality rate 0.08% - 1.03% 0.01% - 1.32% TMO2008* 0.10% - 1.32% Resignation rate 0% - 34% 0% - 31% 0% - 23% 0% - 18%

* Male and Female Thai Mortality Ordinary Table of 2008 which is the latest mortality table from the Office of

Insurance Commission in Thailand.


67

23 Share capital and warrants

Consolidated and Separate financial statements

Par value 2014 2013 per share Number Baht Number Baht

(in Baht) (thousand shares / thousand Baht) Authorised At 1 October - ordinary shares 1 1,132,807 1,132,807 783,004 783,004 Reduction of shares 1 (1) (1) (75,000) (75,000) Increase of new shares 1 411,300 411,300 424,803 424,803 At 30 September - ordinary shares 1 1,544,106 1,544,106 1,132,807 1,132,807 Issued and paid-up At 1 October - ordinary shares 1 991,838 991,838 708,004 708,004 Issue of new shares 1 298,111 298,111 283,202 283,202 Exercise of warrants 1 3,286 3,286 632 632 At 30 September - ordinary shares 1 1,293,235 1,293,235 991,838 991,838 The reduction of authorised share capital At the Annual General Meeting of Shareholders No. 1/2014 held on 30 January 2014, the shareholders approved to reduce the Company’s authorised share capital by cancelling 641 authorised but unissued shares which were allocated to reserve for the newly issued securities in 2013, resulting in a decrease from the existing authorised share capital of Baht 1,132,807,060 to a new authorised share capital of Baht 1,132,806,419 divided into 1,132,806,419 ordinary shares each of par value of Baht 1. Issue of ordinary shares and warrants At the Annual General Meeting of Shareholders No. 1/2014 held on 30 January 2014, shareholders approved the following resolutions: - Increase of the authorised share capital by 411,299,416 shares at a par value of Baht 1 each from the existing

authorised share capital of Baht 1,132,806,419. The new authorised share capital of Baht 1,544,105,835 is divided into 1,544,105,835 shares at the par value of Baht 1 each.

- Issuance and offering of the following securities:

- No more than 298,110,588 new ordinary shares at a par value of Baht 1 each in combination with - No more than 99,370,196 units of warrants to purchase new ordinary shares of the Company No. 4 (“TTA-

W4” or “Warrants”)

The above securities will be offered to existing shareholders in proportion to their shareholding percentage (Right Offering: RO) in a ratio of 10 existing ordinary shares to 3 new ordinary shares in combination with 1 Warrant (10:3:1). The RO price is Baht 14 per share. The offering price for the Warrants is Baht 0 per unit. The exercise price for the Warrants is Baht 18.5 per share (except in case of rights adjustments). Existing shareholders exercising the right to subscribe for the capital increase shares must exercise their right simultaneously and proportionately to subscribe for Warrants.


68

- Allocation of capital increase ordinary shares as follows:

Offering of new ordinary shares

- No more than 298,110,588 new ordinary shares at the par value of Baht 1 per share must be offered to existing shareholders of the Company in proportion to their shareholding percentage at a ratio of 10 existing ordinary shares to 3 new ordinary shares at an offering price of Baht 14 per share.

- Existing shareholders shall have the right to oversubscribe in the RO based on the ratio specified above

by indicating their intention to oversubscribe by no more than 50 percent of existing ordinary shares held by them. Shareholders may oversubscribe, and oversubscription shares may be allocated to such oversubscribing shareholders only when there are shares left after allocation to all shareholders who have subscribed to shares proportionately to their shareholding percentage in the RO. Such allocation of oversubscription shares shall be proportionate to their shareholding percentage and shall be subject to the foreign shareholding limit as prescribed under the Articles of Association of the Company, which currently provides that foreign shareholders may hold shares in the Company up to 49 percent of total issued shares of the Company.

- Any new ordinary shares left after allocation to existing shareholders shall be allocated in a private

placement (the "Private Placement") at an offering price, which is not lower than 90 percent of market price. However, the Private Placement offering price will not be lower than the RO price.

Allocation of new ordinary shares for the exercise of Warrants

- No more than 99,370,196 new ordinary shares shall be allocated for the exercise of warrants No. 4 to

purchase ordinary shares of the Company to be offered proportionately to existing shareholders of the Company.

The registration of the increase of authorised share capital was approved by the Business Development Department, Ministry of Commerce on 14 March 2014.

On 13 March 2014, the Company announced the subscription result to the existing shareholders of 298,110,588 rights shares, resulting in proceeds of Baht 4,173.55 million (paid-up share capital of Baht 298.11 million and premium on ordinary shares of Baht 3,875.44 million). On 19 March 2014, the Company announced the result of issuance and allocation of TTA-W4 to the existing shareholders who subscribed for newly issued ordinary shares and were allocated 99,370,196 units of TTA-W4 at an offering price Baht 0 per unit. The new ordinary shares and TTA-W4 were traded on the SET on 18 March 2014 and 26 March 2014, respectively. Exercised of TTA-W3 During the year ended 30 September 2014, TTA-W3 were exercised and registered as paid-up share capital by 2.14 million shares and in proceeds of Baht 36.18 million (paid-up share capital of Baht 2.14 million and premium on ordinary shares of Baht 34.04 million). Exercised of TTA-W4 During the year ended 30 September 2014, TTA-W4 were exercised and registered as paid-up share capital by 1.14 million shares and in proceeds of Baht 21.17 million (paid-up share capital of Baht 1.14 million and premium on ordinary shares of Baht 20.03 million).


69

Movements in the number of warrants outstanding and their related weighted average exercise prices are as follows: Consolidated Separate financial statements financial statements

Average exercise price

per warrant

Number of

Average exercise price

per warrant

Number of (in Baht) units’000 (in Baht) units’000 At 1 October 2013 17.0 139,210 17.0 139,210 Issue 18.5 99,370 18.5 99,370 Exercise 17.2 (9,068) 17.2 (9,068) At 30 September 2014 17.6 229,512 17.6 229,512 On 5 February 2014, the Company adjusted the Exercise Price and Exercise Ratio of TTA-W3 to be as follows: Exercise price prior to the adjustment : Baht 17.0000 per 1 ordinary share New exercise price after the adjustment : Baht 16.1655 per 1 ordinary share Exercise ratio prior to the adjustment : 1 Unit of Warrant to 1.0000 ordinary share New exercise ratio after the adjustment : 1 Unit of Warrant to 1.0516 ordinary share

24 Legal reserves

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Opening balance 93,500 93,500 93,500 93,500 Appropriation during the year 5,330 - 5,330 - Closing balance 98,830 93,500 98,830 93,500

Under the Public Limited Company Act., B.E. 2535, the Company is required to set aside as legal reserve at least 5% of its annual net profit after accumulated deficits brought forward (if any) until the reserve is not less than 10% of the authorised share capital. The legal reserve is non-distributable.


70

25 Share-based payment MMPLC had four share option schemes in operation during the financial year, all of which are equity-settled schemes: i) Employee share option plan 2008 (“ESOP 2008”) was approved by MMPLC’s shareholders on 11 July 2007.

This scheme permits the grant of options in respect of ordinary shares to MMPLC’s executive directors. Options are normally exercisable every six months commencing from the third anniversary from the date of grant of the option and will expire on the fifth anniversary from the date of grant of the options, upon which the options shall expire automatically. No further options will be granted under this scheme.

ii) Employee share option plan 2009 (“ESOP 2009”) was approved by MMPLC’s shareholders on 29 January

2009. This scheme permits the grant of options in respect of ordinary shares to MMPLC’s executive directors. Options are normally exercisable every six months commencing from the third anniversary from the date of grant of the option and will expire on the fifth anniversary from the date of grant of the options, upon which the options shall expire automatically. No further options will be granted under this scheme.

iii) Employee share option plan 2010 (“ESOP 2010”) was approved by MMPLC’s shareholders on 28 January

2010. This scheme permits the grant of options in respect of ordinary shares to MMPLC’s executive directors and non-executive directors. Options are normally exercisable every six months commencing from the third anniversary from the date of grant of the option and will expire on the fifth anniversary from the date of grant of the options, upon which the options shall expire automatically. No further options will be granted under this scheme.

iv) Employee share option plan 2011 (“ESOP 2011”) was approved by MMPLC’s shareholders on 25 January

2011. This scheme permits the grant of options in respect of ordinary shares to MMPLC’s executive directors and non-executive directors. Options are normally exercisable every six months commencing from the third anniversary from the date of grant of the option and will expire on the fifth anniversary from the date of grant of the options, upon which the options shall expire automatically. No further options will be granted under this scheme.

Share options were granted to selected executives and non-executive directors of MMPLC and its subsidiaries. The exercise price of the granted options is equal to the average of the “Market Price”, being the price equal to the weighted average price for the shares on the Singapore Exchange (SGX-ST) fifteen consecutive trading days immediately preceding the date of grant. Options are conditional on the employee completing three years’ service (the vesting period). The options are exercisable starting three years from the grant date. MMPLC has no legal or constructive obligation to repurchase or settle the options in cash. Pursuant to the terms of each ESOP, an adjustment must be made to the exercise price and/or the numbers of options granted in the event that there is any variation to MMPLC’s issued capital, such as arising from a rights issue. This is for purpose of the mitigation of the dilution effect on the options already granted arising from such a capitalising exercise. In early October 2013, MMPLC completed a capitalisation exercise in the form of a non-renounceable non-underwritten rights issue and private placement of 627,798,180 shares at a price of SGD 0.28 for each rights share on the basis of 4 rights shares for every 5 existing ordinary shares.


71

Accordingly, the total number of options granted pursuant to ESOP 2008, ESOP 2009, ESOP 2010, and ESOP 2011 and their respective exercise prices have been adjusted by the Remuneration Committee to be as follows:

Outstanding no. of

options Previous

exercise price (SGD per share)

Adjusted no. of options

Adjusted exercise price

(SGD per share) ESOP 2008 661,200 0.30 745,092 0.27 ESOP 2009 552,000 0.81 622,037 0.72 ESOP 2010 345,000 0.45 388,773 0.40 ESOP 2011 620,000 0.24 698,664 0.21 Total 2,178,200 2,454,566

None of the participants in any of the said ESOPs were granted 5% or more of the total number of options originally available in each ESOP and no options were granted at a discount. Furthermore, no directors or controlling shareholders of MMPLC hold options under any of the said ESOPs and no options are held by the Company or other subsidiaries, nor any of its or their directors or employees. Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:

Consolidated financial statements Average Option

exercise price SGD per share

Shares ’000

At 1 October 2012 0.42 2,532 Granted 0.39 276 Forfeited 0.33 (353) At 30 September 2013 0.39 2,455 At 1 October 2013 0.39 2,455 Forfeited 0.28 (209) Exercise 0.27 (535) Expired 0.27 (210) At 30 September 2014 0.46 1,501 Out of the 1,500,998 outstanding options (2013: 2,454,566 options), 937,562 options (2013: 1,367,129 options) were exercisable. None of the share options were exercised during the financial year. The average share price during the financial year ended 30 September 2014 was SGD 0.44 per share (2013: SGD 0.36 per share).


72

Share options outstanding at the end of the year have the following expiry date and exercise prices: Consolidated financial statements Exercise 30 30 price September September SGD per 2014 2013 share Shares’000 Shares’000 Expired date: 20 November 2013 0.27 - 745 16 November 2014 0.72 622 622 1 December 2015 0.40 316 389 15 December 2016 0.21 563 699 1,501 2,455 The weighted average fair value of options granted during the year determined using the Binomial Lattice valuation model was SGD 0.09 per option. The significant inputs into the model were a weighted average share price of SGD 0.23 at the grant date, exercise price shown above, volatility of 45%, dividend yield of 0%, an expected option life of 3.85 years, and an annual risk-free interest rate of 3.015% - 3.081%. On 15 December 2011, 1,310,000 share options were granted to MMPLC’s executive directors and non-executive directors with an exercise price set at the market price on that date of SGD 0.24 per share (share price: SGD 0.23 per share) (expiry date: 15 December 2016). With the effective of TFRS 2, share-based payments granted on or after 1 October 2011 will be accounted for. Given that this option has a vesting period of 3 years, the accounting expense with respect to the plan may be amortised over 3 years. The projected accounting expense calculated by an actuary which is recognised as a component of equity in the statement of changes in equity for the year ended 30 September 2014 amounts to Baht 0.46 million or USD 14,272.9 (2013: Baht 0.46 million or USD 14,719.7).


73

26 Segment information Segment information is presented in respect of the Group’s business segments. The primary format, business segments, is based on the Group’s management and internal reporting structure. Business segments The Group comprises the following main business segments:

Segment 1 Transport Segment 2 Infrastructure Segment 3 Energy Segment 4 Holding

Business segment results Revenue and results, based on business segments, in the consolidated financial statements for the years ended 30 September 2014 and 2013 were as follows:

Consolidated financial statements For the year ended 30 September 2014 Elimination of

inter-

segment

Transport Infrastructure Energy Holding transactions Total (in thousand Baht) Revenues from operations 7,197,004 4,441,210 10,088,183 - (295,159) 21,431,238 Revenues from inter-segment (295,095) (64) - - 295,159 - Revenue from external customers 6,901,909 4,441,146 10,088,183 - - 21,431,238 Depreciation and amortisation 695,691 120,915 950,121 92,449 (35) 1,859,141 Operating profits (losses) 551,493 308,511 741,134 859,030 (1,214,772) 1,245,396 Share of profits from associates and joint ventures 157,548 33,579 994,964 - - 1,186,091 Finance costs (124,398) (76,836) (125,234) (332,627) 167,236 (491,859) Income taxes (72,991) (76,835) (166,063) 2,726 (1,190) (314,353) Net profits (losses) for the year 511,652 188,419 1,444,801 529,129 (1,048,726) 1,625,275 Property, plant, and equipment 12,845,348 1,600,093 12,204,325 291,463 (16,993) 26,924,236 Total assets 22,752,523 3,240,167 24,191,228 37,468,125 (38,321,317) 49,330,726 Other material non-cash items: - Impairment loss on property,

plant and equipment and intangible assets -

14,938

-

-

-

14,938


74

Consolidated financial statements For the year ended 30 September 2013 (restated) Elimination of inter-segment Transport Infrastructure Energy Holding transactions Total (in thousand Baht) Revenues from operations 5,090,010 5,407,871 8,243,401 492,058 (770,251) 18,463,089 Revenues from inter-segment (278,130) (63) - (492,058) 770,251 - Revenue from external customers 4,811,880 5,407,808 8,243,401 - - 18,463,089 Depreciation and amortisation 771,679 122,813 841,494 129,434 9 1,865,429 Operating profits (losses) (3,968,121) 21,319 710,178 (226,315) (957,897) (4,420,836) Share of profits from associates and joint ventures 126,003 22,378 106,281 - - 254,662 Finance costs (100,806) (78,872) (151,401) (340,406) 161,860 (509,625) Income taxes (74,838) (61,008) (147,808) 44,492 (989) (240,151) Net profits (losses) for the year (4,017,762) (96,183) 517,250 (522,229) (797,026) (4,915,950) Property, plant, and equipment 8,783,724 1,561,896 10,291,605 314,341 (17,029) 20,934,537 Total assets 18,640,931 3,960,406 22,281,860 37,362,781 (39,013,675) 43,232,303 Other material non-cash items: - Impairment loss on property,

plant and equipment and intangible assets 3,916,889

7,718

-

79,839

-

4,004,446 Geographical information The Group has expanded its investment and operations in foreign countries. All significant revenue from sales and non-current assets on the basis of geography is presented in this information. Revenue is based on the geographical location of customers and segment non-current assets are based on the geographical location of the assets Consolidated financial statements Revenue from sales Non-current assets 2014 2013 2014 2013 (in thousand Baht) Asia 16,968,083 14,419,218 34,565,242 27,729,418 Africa 876,492 1,761,624 344 - America 729,176 854,486 - - Europe 2,647,951 993,670 1,364 376 Other 209,536 434,091 - - Total 21,431,238 18,463,089 34,566,950 27,729,794 Separate financial statements Revenue from sales Non-current assets 2014 2013 2014 2013 (in thousand Baht) Asia - - 28,764,675 23,829,367 Total - - 28,764,675 23,829,367 Major customer Revenues from major customers of the Group’s Energy segment represents approximately Baht 3,799.83 million (2013: Baht 3,656.21 million) of the Group’s total revenues.


75

27 Other operating income Consolidated Separate financial statements financial statements Years ended 30 September 2014 2013 2014 2013 (in thousand Baht) Dividend income 1,606 1,795 519,155 316,757 Gains on exchange rates 181,474 71,197 154,583 72,254 Interest income 55,368 38,383 51,392 38,514 Gains on sales of property, plant, and equipment 5,247 45,969 612 -

Gains on disposals of short-term investments 110 32,284 110 8,224 Management fee income - - - (4,273) Compensation for termination of property, plant and equipment - 14,882 - - Insurance claims received - 11,785 - - Realised gains on cross currency and interest rate swap agreements - 11,653 - 11,653

Gains on disposals of investments in subsidiaries - - - 144 Other income 95,788 61,663 34,209 33,265 Total 339,593 289,611 760,061 476,538

28 Expense by nature The statements of income include an analysis of expenses by function. Expenses by nature disclosed in accordance with the requirements of various TFRS were as follows: Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Expenses included in vessel operating expenses Voyage expenses 2,235,076 1,745,172 - - Vessel supplies and spare parts expenses and repair and maintenance expenses 257,814 206,308 - - Crew and staff costs 472,416 368,544 - - Charter hire 2,369,735 1,505,038 - - Depreciation and amortization 686,575 761,223 - - Expenses included in offshore service expenses Vessel expenses and repair and maintenance expenses 1,758,662 1,213,245 - - Crew, staff costs, and subcontractor costs 4,088,603 3,809,909 - - Charter hire and equipment rental 1,084,940 549,137 - - Depreciation and amortisation 919,314 816,924 - -


Thoresen Thai Agencies Public Company Limited and its Subsidiaries Notes to financial statements

76

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Expenses included in costs of sales Cost of raw materials 3,091,365 4,113,396 - - Supplies and spare parts expenses and repair and maintenance expenses 39,400 41,854 - - Staff costs 100,826 91,564 - - Depreciation and amortisation 73,820 66,419 - - Expenses included in service, selling, and administrative expenses Staff costs 1,342,465 1,216,741 202,807 177,415 Professional fees 154,863 164,637 27,223 30,172 Office and office equipment rental 54,933 52,261 6,989 7,167 Depreciation and amortisation 179,432 220,863 33,673 49,112 Impairment charges and write-offs Impairment on short-term loans to related parties - 10,123 - - Impairment on inventories and vessels supplies

and spare parts -

243,294 - - Impairment on long-term loans to related parties - - 506,901 - (Reversal of) Impairment on investments in

subsidiaries, associates, and joint venture - 120,245 (504,054) 412,276 Impairment on goodwill - 516,031 - - Impairment on property, plant, and equipment and intangible assets 14,938 4,004,446 - - Write-off of property, plant, and equipment 79 659 - - Write-off of prepaid withholding tax 9,910 - - -


77

29 Income tax expense

Income taxes as shown in the consolidated and Company statements of income are calculated based on net taxable income from non-BOI activities using a principal tax rate for operations in Thailand and specific tax rates applicable to each respective country for overseas operations. Non-BOI activities comprise gains from disposals of assets, shipping related services including agency, drilling services outside Thailand, offshore related services, and production and trading of fertiliser and coal.

Income tax recognised in profit or loss

Consolidated

financial statements Separate

financial statements For the years ended 30 September Note 2014 2013 2014 2013 (restated) (restated) (in thousand Baht) Current tax expense Current year 300,503 217,970 - - Deferred tax expense Movements in temporary differences 3,19 13,850 22,181 (16,009) (23,805) Total income tax expense (benefits) 314,353 240,151 (16,009) (23,805)

Income tax recognised in other comprehensive income

Consolidated and Separate financial statements For the years 2014 2013 ended 30 September (restated) Tax Tax Before (expense) Net of Before (expense) Net of tax benefit tax tax benefit tax (in thousand Baht) Change in fair value

available-for-sale investments 8,137 (1,627) 6,510 (27,704) 782 (26,922)


78

Reconciliation of effective tax rate

Consolidated financial statements 2014 2013 (restated) Rate

(%)

(in thousand Baht)

Rate (%)

(in thousand Baht)

Profit (loss) before income tax expense 1,939,628 (4,675,779) Income tax using the Thai corporation tax rate 20 387,926 23 (1,075,434) Income tax reduction - current (2) (37,796) - 235 Income tax reduction - deferred - (7,612) (2) 107,239 Effect of different tax rates in foreign jurisdictions 7 140,405 (6) 306,104 Income not subject to tax (32) (622,858) 2 (107,760) Expenses not deductible for tax purposes 4 72,729 (2) 99,809 Recognition of previously unrecognised tax losses (6) (112,856) - (13,690) Current year losses for which no deferred tax asset was recognised 23 443,584 (21) 969,237 Utilisation of previously unrecognized tax losses - (148) (1) 58,576 Under (over) provided in prior years 1 28,481 1 (65,773) Translation adjustment 1 22,498 1 (38,392) Total 16 314,353 (5) 240,151

Separate financial statements 2014 2013

(restated)

Rate (%)

(in thousand Baht)

Rate (%)

(in thousand Baht)

Profit (loss) before income tax expense 90,446 (594,655) Income tax using the Thai corporation tax rate 20 18,089 23 (136,771) Income tax reduction - deferred - - (3) 17,840 Income not subject to tax (41) (37,260) 11 (63,362) Expenses not deductible for tax purposes 3 2,337 (26) 155,121 Under (over) provided in prior years 1 825 (1) 3,367 Total (17) (16,009) 4 (23,805)

Income tax reduction Royal Decree No. 530 B.E. 2554 dated 21 December 2011 grants a reduction in the corporate income tax rate for the three accounting periods 2012, 2013, and 2014; from 30% to 23% for the accounting period 2012 which begins on or after 1 January 2012 and to 20% for the following two accounting periods 2013 and 2014 which begin on or after 1 January 2013 and 2014, respectively. It is understood that the Government will proceed to amend the law in order to maintain the corporate income tax rate at not higher than 20% for the accounting period 2015 which begins on or after 1 January 2015 and onwards in order to give full effect to the Cabinet resolution dated 11 October 2011 to increase Thailand’s tax competitiveness


79

30 Earnings (losses) per share Basic earnings (losses) per share The calculation of basic earnings (losses) per share for the year was based on the profits (losses) for the year attributable to equity holders of the Company and the weighted average number of ordinary shares outstanding during the year as follows: Consolidated Separate financial statements financial statements Years ended 30 September 2014 2013 2014 2013 (restated) (restated) (in thousand Baht / thousand shares) Profits (losses) for the year attributable to equity holders of the Company (basic) 1,015,229 (5,119,059) 106,455 (570,850) Number of ordinary shares outstanding at 1 October 2013 and 2012 991,838 708,004 991,838 708,004 Effect of new shares issued during the year 166,374 158,435 166,374 158,435 Weighted average number of ordinary shares outstanding (basic) 1,158,212 866,439 1,158,212 866,439 Effect of exercise warrants TTA-W3 25,456 - 25,456 - Effect of exercise warrants TTA-W4 5,413 - 5,413 - Weighted average number of ordinary shares outstanding (diluted) 1,189,081 - 1,189,081 - Basic earnings (losses) per share (in Baht) 0.88 (5.91) 0.09 (0.66) Diluted earnings per share (in Baht) 0.85 -* 0.09 -*

* Diluted losses per share

There was no potential dilution in losses per share from the warrant for the year ended 30 September 2013, because the average share price during that period was lower than the exercise price.

31 Dividends

a) For the year ended 30 September 2014

MMPLC At the Annual General Meeting of the Shareholders No.1/2014 held on 28 January 2014, the shareholders approved the payment of an annual dividend of Baht 0.2630 per share, amounting to Baht 371.6 million. The dividend payment was made to shareholders on 21 February 2014.

b) For the year ended 30 September 2013 MMPLC At the Annual General Meeting of Shareholders No.1/2013 held on 28 January 2013, the shareholders approved the payment of an annual dividend of Baht 0.0274 per share, amounting to Baht 21.5 million. The dividend payment was made to shareholders on 22 February 2013.


80

32 Promotional privileges As at 30 September 2014 and 2013, one direct subsidiary and six indirect subsidiaries received promotional privileges from the Board of Investment (“BOI”) under services of submerged structure inspection, service of underwater equipment, service of inspection of marine pollution, drilling services, trade and investment service office, and port services. The main privileges include exemption from payment of import duty on machinery and exemption from corporate income taxes for the promoted activities for a period of 8 years from the date when income is first derived, or when approval is given by the BOI. Furthermore, a shipping subsidiary received promotional privileges from the Maritime and Port Authority of Singapore (“MPA”) under service of domestic and international shipping. The main privileges include exemption from corporate income taxes for the shipping profits for the period commencing from 8 September 2008 to 8 September 2016. To be entitled to the privileges, the Group must comply with the conditions and restrictions provided in the promotional certificates.

33 Financial instruments

Financial risk management policies The principal financial risks faced by the Group are foreign exchange rate risk, interest rate risk, bunker prices, freight rates, and credit risk. The objective in using financial instruments is to reduce the uncertainty over future cash flows arising from movements in exchange rates, interest rates, bunker prices, and freight rates, and to manage the liquidity of the cash resources. Capital management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders and issue new shares or bonds. Foreign exchange rate and interest rate risk The exchange rate risk is the principal risk faced by the Group as certain purchases and services are entered into foreign currencies and also interest rate risk, which is the risk that future movements in market interest rates will affect the results of the Group’s operations and its cash flows. The Group manages these risks as follows:

a) Cross currency and interest rate swap contracts

The Company entered into cross currency and interest rate swap contracts with a commercial bank against 5 year and 7 year Thai Baht bonds with maturities in 2015 and 2017. The Company has locked in fixed USD interest rates of 3.65% and 3.60% per annum, respectively. As at 30 September 2014, the outstanding bond balances were USD 127.83 million (2013: USD 127.83 million) and these bonds had notional amounts of Baht 4,000 million (2013: Baht 4,000 million).

The Company entered into a cross currency and interest rate swap contracts with a commercial bank against a long term loan with repayment term over 5 years. The Company swapped interest rates from 6M THBFIX + 2.00% per annum to USD 6M Libor + 2.93% per annum. In September 2014, the Company partially unwind the swap in order to reverse some obligations to THB to match with its sources of funds. Therefore, as at 30 September 2014, the outstanding long-term loan balance was divided into 2 currencies: (1) THB 60 million and (2) USD 28.25 million (2013: THB 280 million, USD 28.25 million) and this loan had a notional amount of Baht 940 million (2013: Baht 1,160 million).


81

The net fair values of the cross currency and interest rate swap contracts at the statements of financial position date are as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Unfavorable on cross currency and interest rate swap contracts 277,945 197,912 277,945 197,912 The fair values of cross currency and interest rate swap contracts have been calculated (using rates quoted by the counterparty to the contracts) as if the contracts were terminated at the statements of financial position date. At 30 September, the Group and the Company were exposed to foreign currency risk in respect of financial assets and liabilities denominated in the following currencies:



Note 2014 2013 2014 2013 (in thousand baht)

United States Dollars Cash and cash equivalents 3,838,251 110,328,956 555,921 156,547 Short-term investments 1,933,924 671,543 - - Trade accounts receivable 2,369,413 2,279,725 - - Receivables from related parties 2,854,266 2,069,241 52,639 51,460 Short-term loans to related parties 2,756,249 8,842,342 1,083,845 3,703,416 Short term loan from related parties (1,507,556) (3,944,993) (1,197,406) (1,161,204) Trade accounts payable (1,938,780) (1,738,377) (592) (2) Other accounts payable (235,515) (196,854) (26) (25) Payables to related parties (4,982) (14,736) (270) (262) Advances from customers (3,684,028) (3,884,512) - - Long-term loans 21 (8,073,322) (7,427,532) - - Gross balance sheet exposure (1,692,080) 106,984,803 494,111 2,749,930 Currency swaps - - - - Currency forwards - (15,611) - - Net exposure (1,692,080) 106,969,192 494,111 2,749,930

Consolidated


financial statements 2014 2013 2014 2013 (in thousand baht)

Singapore Dollars Cash and cash equivalents 63,747 3,900 273 - Receivables from related parties 51,663 139 - - Short-term loans to related parties - 277,968 - 277,968 Trade accounts payable (10,414) (14,807) - - Other accounts payable - (36) - - Payables to related parties (52,203) (441) (52,203) (129) Gross balance sheet exposure 52,793 266,723 (51,930) 277,839 Currency swaps - - - - Currency forwards - - - - Net exposure 52,793 266,723 (51,930) 277,839


82

T



2014 2013 2014 2013 (in thousand baht)

Vietnam Dongs Cash and cash equivalents 263,120 103,343 - - Trade accounts receivable 51,041 29,845 - - Trade accounts payable (42,939) (36,501) - - Gross balance sheet exposure 271,222 96,687 - - Currency swaps - - - - Currency forwards - - - - Net exposure 271,222 96,687 - -



2014 2013 2014 2013 (in thousand baht)

The British Pound Short-term investments 15,929 15,637 15,929 15,637 Gross balance sheet exposure 15,929 15,637 15,929 15,637 Currency swaps - - - - Currency forwards - - - - Net exposure 15,929 15,637 15,929 15,637

Consolidated


financial statements 2014 2013 2014 2013 (in thousand baht)

Indonesian Rupiah Cash and cash equivalents 13,141 10,346 - - Trade accounts payable (191,280) (84,632) - - Other accounts payable (263,076) (92,497) - - Gross balance sheet exposure (441,215) (166,783) - - Currency swaps - - - - Currency forwards - - - - Net exposure (441,215) (166,783) - -


83

b) Forward foreign exchange contracts

UMS, a subsidiary, entered into forward foreign exchange contracts with local financial institutions in order to hedge the foreign exchange risk. As at 30 September 2014, there is no outstanding contracts (30 September 2013: USD 0.5 million at rate of Baht 29.14 per USD).

c) Bunker swap contracts

During the year 2014, a subsidiary entered into bunker swap contracts with commercial banks for hedging bunker prices in connection with long-term cargo contract commitments. The subsidiary has locked in bunker price at the range of USD 572.0 - USD 594.0. As at 30 September 2014, the outstanding bunker quantities were 6,000 metric tonnes. The net fair values of the bunker swap contracts at the statements of financial position date are as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand USD) Favorable (unfavorable) on bunker swap contracts, net 320 134 - -

d) Forward freight agreements

TSS entered into forward freight agreements with financial institutions and exchange traded derivatives for hedging freight rates in connection with chartered-in vessels. TSS has locked in freight rates at a range of USD 11,300 - USD 14,200 per day (2013: USD 9,500 - USD 12,850 per day). As at 30 September 2014, the outstanding forward freight agreements to sell are 60 days (2013: 180 days). The net fair values of the forward freight agreements at the statement of financial position date are as follows: Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand USD) Favorable on forward freight agreements 96 90 - -

Credit risk Credit risk is the potential financial loss resulting from the failure of a customer or counterparty to settle its financial and contractual obligations to the Group as and when they fall due. Most of the Group’s income, being freight income, is normally paid by clients in advance, or prior to the corresponding cargoes being released to them. Management is therefore of the opinion that credit risk is not significant, and that the cost of hedging will outweigh the possible benefit. The Group has not entered into any derivative contracts relating to credit risk. For the offshore service income and the revenues from sales and service income, management is of the opinion that credit risk is not significant. The Group has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. Determination of fair values The carrying amounts of the financial assets and financial liabilities approximate their fair value.


84

34 Commitments and contingent liabilities

34.1 Capital commitments The Group has significant capital commitments towards building, machinery, warehouse construction, ship building, dry-docking, and vessel equipment contracts but not yet recognised as liabilities as at 30 September 2014 and 2013 as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in millions) - USD 372.1 0.9 - - - VND 79,426.8 12,875.0 - - - THB 1.9 6.2 - -

34.2 Other commitments

a) Operating lease commitments

The future aggregate minimum lease payments under non-cancellable operating leases of vessels and land are as follows:

Consolidated Separate financial statements financial statements 2014 2013 2014 2013 (in thousand Baht) Not later than 1 year 324,716 670,322 - - Later than 1 year but not later than 5 years 296,184 569,824 - - Later than 5 years 99,164 117,446 - - Total 720,064 1,357,592 - -

b) Sale and purchase contracts for steam coal

As at 30 September 2014, UMS, a subsidiary, had outstanding commitments relating to sale and purchase contracts for steam coal with foreign coal suppliers for a specific volume plus or minus 10%. The coal price shall be adjusted, subject to the quality of the coal, as specified by a formula in the agreements. Moreover, UMS also had outstanding commitments relating to sales contracts for steam coal with domestic enterprises for a specific volume plus or minus 10% at a fixed price per contract.

34.3 Significant agreements

Vessel and rig charter contracts

Consolidated


financial statements 2014 2013 2014 2013

Long-term charter-out contracts: Number of vessels and rigs 1 - - - Remaining period (months) 18 - - -

Long-term charter-in contracts: Number of vessels 2 2 - - Remaining period (months) 5 - 26 17 - 35 - -


85

34.4 Contingent liabilities

a) Guarantees The Company and the Group have given the following guarantees in the normal course of business:

30 September 2014 Consolidated financial statements Baht million USD million VND million AED million Letter of guarantees issued by bank on behalf of the Group 26.0 26.5 43,172.0 5.0 Guarantee given by the Group to financial institutions to guarantee credit facilities, purchases of raw materials, bunker swap, and freight forwarding 3.1

226.2

-

-

30 September 2014 Separate financial statements Baht million USD million Letter of guarantees issued by bank on behalf of the Group 3.1 - Guarantee given by the Group to financial institutions to guarantee credit facilities, purchases of raw materials, bunker swap, and freight forwarding 3.1 97.1

30 September 2013 Consolidated financial statements Baht million USD million VND million QAR million Letter of guarantees issued by bank on behalf of the Group 25.2 20.8 24,512.6 - Guarantee given by the Group to financial institutions to guarantee credit facilities, purchases of raw materials, bunker swap, and freight forwarding 58.2

254.8

-

17.6

30 September 2013 Separate financial statements Baht million USD million Letter of guarantees issued by bank on behalf of the Group - - Guarantee given by the Group to financial institutions to guarantee credit facilities, purchases of raw materials, bunker swap, and freight forwarding 58.2 120.9

b) Other contingent liabilities

As at 30 September 2014, a subsidiary had other contingent liabilities of approximately USD 2 million (2013: USD 2 million).


86

35 Events after the reporting period

On 1 October 2014, Soleado entered into a share subscription agreement with Sino Grandness Food Industry Group Limited ("SGFI"), a Singapore listed company with its head quarter in the People's Republic of China, to invest in SGFI via a private placement of newly issued 60,601,035 ordinary shares at SGD 0.61 per share. Total investment amount is SGD 36.97 million (approximately Baht 954.29 million) and the percentage of shareholding is 9.00%. Subsequently, in accordance with supplemental deeds to subscription agreement on 28 October 2014, the price of placement share shall be adjusted to be SGD 0.50 per shares or the volume weighted average price per shares traded on the SGX-ST on the last market day immediately preceding the date of completion. However, such agreement is subjected to the approval by SGX and its shareholders.

At the Extra-Ordinary Shareholders’ meeting of Premo held on 7 October 2014, the shareholders approved the decrease of Premo’s registered and paid-up capital from Baht 7,393.55 million to Baht 2,220.00 million by reducing the ordinary shares from 73,935,500 shares to 22,200,000 shares at a par value of Baht 100. The registration of the decrease of this paid-up capital is in the process. On 8 October 2014, Mermaid Subsea Services (International) Ltd., a subsidiary, has increased its shareholding interest in Subtech Saudi Arabia Limited. from 70% to 95%. As a result, the Company now holds an indirect 95% interest in Subtech Saudi Arabia Limited. At the Board of Directors Meeting of PMTA held on 17 November 2014, the Board approved an interim dividend payment for the year ended 30 September 2014 of Baht 328.64 million. At the Board of Directors Meeting of MMPLC held on 26 November 2014, the Board approved to recommend an annual dividend payment equal to 15% of the net profits for the year ended 30 September 2014. Total dividends will be approximately Baht 218 million or equivalent to USD 6.7 million. This dividend shall be proposed to the Annual General Meeting of Shareholders of MMPLC in January 2015 for their consideration and approval.

36 Change of the Company’s accounting period

At the Annual General Meeting of Shareholders of the Company held on 30 January 2014, the shareholders approved to change the Company’s accounting period from beginning on 1 October and ending on 30 September to beginning on 1 January and ending on 31 December. The Company has completed the registration with the Department of Business Development, Ministry of Commerce and already obtained an approval from the Department of Revenue for this change which has an effect on the Company’s first change of accounting period to commence on 1 October 2014 and end on 31 December 2014.


87

37 Thai Financial Reporting Standards (“TFRS”) not yet adopted The Group has not adopted the following new and revised TFRS that have been issued as of the reporting date but are not yet effective. Those new and revised TFRS are expected to become effective for annual financial periods beginning on or after 1 January in the year indicated in the following table:

TFRS Topic Year

effective TAS 1 (revised 2012) Presentation of financial statements 2014 TAS 7 (revised 2012) Statement of Cash Flows 2014 TAS 12 (revised 2012) Income Taxes 2014 TAS 17 (revised 2012) Leases 2014 TAS 18 (revised 2012) Revenue Recognition 2014 TAS 19 (revised 2012) Employee Benefits 2014 TAS 21 (revised 2012) The Effects of Changes in Foreign Exchange Rates 2014 TAS 24 (revised 2012) Related Party Disclosures 2014 TAS 28 (revised 2012) Investments in Associates 2014 TAS 31 (revised 2012) Interests in Joint Ventures 2014 TAS 34 (revised 2012) Interim Financial Reports 2014 TAS 36 (revised 2012) Impairment of Assets 2014 TAS 38 (revised 2012) Intangible Assets 2014 TFRS 2 (revised 2012) Share-based Payment 2014 TFRS 3 (revised 2012) Business Combinations 2014 TFRS 5 (revised 2012) Non-current Assets held for Sale and Discontinued Operations 2014 TFRIC 4 Determining whether an Arrangement contains a Lease 2014 TFRIC 10 Interim Financial Reporting and Impairment 2014 TFRIC 17 Distributions of Non-cash Assets to Owners 2014 TFRIC 18 Transfers of Assets from Customers 2014 TIC 15 Operating Leases-Incentives 2014 TIC 27 Evaluating the Substance of Transactions Involving the Legal

Form of a Lease 2014

Management expects to adopt and apply these new and revised TFRS in accordance with the FAP’s announcement and has made a preliminary assessment of the potential initial impact on the consolidated and separate financial statements of these new and revised TFRS and expects that there will be no material impact on the financial statements in the period of initial application.


MANAGEMENT STRUCTURE

The Company’s management structure comprises of the Board of Directors and five (5) sub-committees namely 1) Executive Committee, 2) Audit Committee, 3) Nomination and Remuneration Committee, 4) Risk Management Committee, and 5) Corporate Governance Committee.

1. Board of Directors as of 30 September 2014

Thoresen Thai Agencies Public Company Limited

No. Name Position No. of MeetingMeeting

Attendance

1. Mr. Prasert Bunsumpun Chairman of the Board/Chairman of Executive Committee

10 10

2. Mr. Chalermchai Mahagitsiri President and Chief Executive Officer/Member of Executive Committee/ Member of Risk Management Committee

10 10

3. Mr. Jean Paul Thevenin * Director/Member of Executive Committee 5 5

4. Mr. Chia Wan Huat Joseph Director/Member of Executive Committee/Member of Corporate Governance Committee

10 10

5. Mr. Krish Follett Independent Director/Chairman of Audit Committee/Chairman of Risk Management Committee

10 10

6. Mr. Santi Bangor Independent Director/Chairman of Nomination and Remuneration Committee/Chairman of Corporate Governance Committee/Member of Audit Committee

10 10

7. Ms. Ausana Mahagitsiri Director/Member of Nomination and Remuneration Committee/Member of Corporate Governance Committee

10 7

8. Mr. Mohammed Rashed Ahmad M. Al Nasseri

Independent Director/Member of Nomination and Remuneration Committee

10 7

9. Mr. Yves Barbieux Director 10 6

10. Mr. Cherdpong Siriwit Independent Director/Member of Audit Committee

10 7

Note : * Mr. Jean Paul Thevenin was appointed a Board Member on 30 January 2014 to replace M.L.Chandchutha Chandratat

who resigned from the Board of Directors on 30 January 2014.



No. Name Position No. of Meeting Meeting Attendance

1. M.L. Chandchutha Chandratat * President and Chief Executive Officer/ Member of Executive Committee/

4 4

2. Mr. Ghanim Saad M. Alsaad Al-Kuwari **

Independent Director 6 0

Note : * M.L. Chandchutha Chandratat resigned from the Board of Directors on 30 January 2014 and Mr. Jean Paul Thevenin became

a Board member on 30 January 2014.

** Mr. Ghanim Saad M. Alsaad Al-Kuwari resigned from the Board of Directors on 9 May 2014.

Authorized Directors

According to the Company’s Certificate of Incorporation issued on 10 October 2014 from the Department of Business Development of the Ministry of Commerce, the authorized signatures of directors which can bind the Company are: Mr. Jean Paul Thevenin or Mr. Chia Wan Huat Joseph, jointly signs with Mr. Chalermchai Mahagitsiri or Ms. Ausana Mahagitsiri, to form two jointly signatures and affixed with the Company Seal will be binding upon the Company.

The Board of Directors of four core subsidiaries: Thoresen Shipping Singapore Pte. Ltd., Mermaid Maritime Public Company Limited, Unique Mining Services Public Company Limited, and Baconco Co., Ltd. are shown below.

a) Thoresen Shipping Singapore Pte. Ltd.


1. Mr. Chalermchai Mahagitsiri Director 11 11

2. Ms. Ausana Mahagitsiri * Director 8 8

3. Mr. Ian Clifford Claxton Director 11 11

4. Mr. Lee Wei Hsiung Director 11 11

5. Mr. Tan King Chang Alternate Director - -

Note : * Ms. Ausana Mahagitsiri became a Board member on 30 January 2014 in place of M.L. Chandchutha Chandratat who resigned

from the Board of Directors on 30 January 2014.

The Board of directors who resigned during the financial year 2014


1. M.L. Chandchutha Chandratat * Managing Director 4 4

Note : * M.L. Chandchutha Chandratat resigned from the Board of Directors on 30 January 2014 and Ms. Ausana Mahagitsiri became

a Board member on 30 January 2014.

b) Mermaid Maritime Public Company Limited


1. Mr. Prasert Bunsumpun Chairman/Non-Executive Chairman 8 8

2. Mr. Chalermchai Mahagitsiri Executive Vice Chairman/CEO 8 8

3. Mr. Chia Wan Huat Joseph Executive Director 8 8

4. Mr. Toh Wen Keong Joachim Independent Director 8 8

5. Mr. Jean Paul Thevenin Non-Executive Director 8 8

6. Mr. Ng Cher Yan Independent Director 8 8

7. Mr. Jan Joseph Skorupa * Independent Director 7 7

Note : * Mr. Jan Joseph Skorupa became a Board member on 21 October 2013.



c) Unique Mining Services Public Company Limited


1. Pol. Gen. Chidchai Vanasatidya Chairman of the Board 9 9

2. Mr. Chalermchai Mahagitsiri Vice Chairman 9 7

3. Mr. Chia Wan Huat Joseph Director/Member of Nomination and Remuneration Committee

9 9

4. Mr. Ekavaj Amornvivat Independent Director/Chairman of Audit Committee

9 9

5. Mr. Suchart Thammapitagkul Independent Director/Member of Audit Committee/Chairman of Nomination and Remuneration Committee

9 8

6. Pol.Lt.Gen. Kamrob Panyakaew Independent Director/Member of Audit Committee

9 8

7. Mr. Taratorn Wongprasat Independent Director/Member of Nomination and Remuneration Committee

9 7

8. Mr. Somporn Chitphentom * Director/Acting Managing Director/Executive Vice President - Accounting

8 8

Note : * Mr. Somporn Chitphentom became a Board member on 6 November 2013.



1. Ms. Ausana Mahagitsiri * Director/Member of Nomination and Remuneration Committee

8 6

Note : * Ms. Ausana Mahagitsiri resigned from the Board of Directors on 1 September 2014.

d) Baconco Co., Ltd.


1. Mr. Sigmund Stromme Chairman 9 9

2. Mr. Chalermchai Mahagitsiri * Director 7 7

3. Mr. Krailuck Asawachatroj ** Director 7 7

Note: * Mr. Chalermchai Mahagitsiri became a Board member on 13 November 2013.

** Mr. Krailuck Asawachatroj became a Board member on 13 November 2013.



1. M.L. Chandchutha Chandratat * Director 2 2

2. Mr. Vichai Chuensuksawadi ** Director 2 2

Note : * M.L. Chandchutha Chandratat resigned from the Board of Directors on 6 November 2013 and Mr. Chalermchai Mahagitsiri became a Board member on 13 November 2013. ** Mr. Vichai Chuensuksawadi resigned from the Board of Directors on 6 November 2013 and Mr. Krailuck Asawachatroj became a Board member on 13 November 2013.



2. Executives as of 30 September 2014

Thoresen Thai Agencies Public Company Limited

No. Name Position

1. Mr. Chalermchai Mahagitsiri President and Chief Executive Officer

2. Mr. Krailuck Asawachatroj Executive Vice President, Corporate Finance and Accounting

3. Mr. Somporn Chitphentom Executive Vice President, Corporate Strategy

4. Ms. Urai Pluemsomran Executive Vice President, Risk Management and Corporate Compliance

5. Mr. Theerarat Piamsuphakphong * Director, Human Resources

Note : * Mr. Theerarat Piamsuphakphong became an executive on 15 May 2014 as defined by the SEC.

The Executives of the four core subsidiaries: Thoresen Shipping Singapore Pte. Ltd., Mermaid Maritime Public Company Limited, Unique Mining Services Public Company Limited, and Baconco Co., Ltd. are shown below.

a) Thoresen Shipping Singapore Pte. Ltd.

No. Name Position

1. Mr. Ian Clifford Claxton Managing Director

2. Mr. Michael Anderson Director, Commercial

3. Mr. Mikal Boe Director, Risk Management

b) Mermaid Maritime Public Company Limited

No. Name Position

1. Mr. Chalermchai Mahagitsiri Executive Vice Chairman/Managing Director

2. Mr. Michael Van Ambrose Managing Director, Mermaid Subsea Services (Thailand) Ltd.

3. Mr. Katarat Suksawang Chief Finance Officer

c) Unique Mining Services Public Company Limited

No. Name Position

1. Mr. Somporn Chitphentom Acting Managing Director and Executive Vice President - Accounting

2. Mr. Krisda Leeaphorn * Managing Director/Acting Executive Vice President - Financial and Accounting

3. Mr. Sathaporn Takdumrongkul Director

4. Mr. Tan Teo Song Director - Sourcing & Logistics

5. Mrs. Pakanat Kiratikosolrak ** Director - Business Development & Investment

6. Mr. Vasa Kosadat *** Acting Director - Sales and Marketing

7. Mr. Vasin Pooltavee **** Director - Finance and Administration

Note : * Mr. Krisda Leeaphorn resigned from the position of Managing Director/Acting Executive Vice President-Financial and

Accounting on 28 July 2014 and Mr. Somporn Chitphentom was appointed in place of Mr. Krisda Leeaphorn on 29 July 2014.

** Mrs. Pakanat Kiratikosolrak resigned from the position of Director-Business Development & Investment on 12 June 2014.

*** Mr. Vasa Kosadat was resigned from the position of acting Director-Sales and Marketing on 15 August 2014.

**** Mr. Vasin Pooltavee was resigned from the position of Director-Finance & Administration on 31 October 2014.



d) Baconco Co., Ltd.

No. Name Position

1. Mr. Pinguet Didier Deputy General Director & Commercial Director

2. Mr. Siquet Pierre Louis Bernard General Director

3. Mr. Ho Ngoc Chau Financial & Administrative

4. Mr. Ngo Xuan Giang Chief Representative, Hai Phong Brunch

5. Mr. Nguyen Dang Cat Plant Manager

Organization Chart of Thoresen Thai Agencies Public Company Limited

As of 30 September 2014

CEO’s Office

Corporate Governance Committee

Nomination andRemuneration

Committee

Company Secretary

Executive Committee

President & CEO

Board of Directors

Internal Audit

Risk ManagementCommittee

Audit Committee

Executive VicePresident, Corporate

Finance and Accounting

Executive VicePresident, Corporate

Strategy

Executive VicePresident, CorporateRisk and Compliance

Corporate HumanResource

CorporateCommunication

3. Company Secretary

The Board of Directors appointed Ms. Mantanee Surakarnkul as the Company Secretary. The roles and responsibilities of the Company Secretary are specified in the Company Secretary and Board Committees of the Corporate Governance Report.

4. Remuneration of the Directors and Executives

4.1 Thoresen Thai Agencies Public Company Limited

Remuneration for the Board, the Board Committees, and Executives

The remuneration structure for the Board is as follows:• Each non-executive director receives a monthly fee and an attendance fee for each meeting. • The Chairman of the Board of Directors and sub- committees receive an attendance fee equal to 1.20 times the attendance fee paid to non-executive directors and other sub-committee members.• A foreign director, residing outside of Thailand, is entitled to a travel allowance when travelling to Thailand for attendance at Board of Directors or committee meetings.• The executive director is not entitled to a monthly fee or other forms of remuneration.• An incentive in the form of annual reward (bonus) shall be paid to directors, corresponded to the Company’s goal achievement as well as approval of the Company’s shareholders.



The Executives’ remuneration consists of cash compensation (salary), bonus and other benefits which are long term incentives, provident fund, and social security contributions.

Remuneration in Cash

Remuneration of the Board

At the 2014 AGM, the remuneration for the Board/1

was acknowledged by the shareholders at the Annual General Meeting of Shareholders is a follows:

• Total standard monthly fee for nine (9) non-executive directors is fixed at Baht 430,000 per month. In case that any additional non-executive director is appointed to the Board, he/she receives a monthly fee of Baht 35,000. The non-executive director receives an attendance fee of Baht 45,000 per meeting. The Chairman of the Board of Directors receives an attendance fee of Baht 54,000 per meeting (1.20 times an attendance fee of non-executive director).• The Chairman of the Audit Committee receives an attendance fee of Baht 48,000 per meeting, which is 1.20 times higher than for other Audit Committee members, receiving an attendance fee of Baht 40,000 per meeting.• The Chairman of the Nomination and Remuneration Committee receives an attendance fee of Baht 36,000 per meeting, which is equal to 1.20 times an attendance fee paid to other members of the Nomination and Remuneration Committee, receiving an attendance fee of Baht 30,000 per meeting.

• The Chairman of the Risk Management Committee and the Chairman of the Corporate Governance Committee receive an attendance fee of Baht 18,000 per meeting, which is equal to 1.20 times the attendance fee paid to other members of the Risk Management Committee and the Corporate Governance Committee, receiving an attendance fee of Baht 15,000 per meeting.• A foreign director, residing outside of Thailand, is entitled to a travel allowance when travelling to Thailand for attendance at Board of Directors or committee meetings as follows:- From Asia to Thailand: USD 500 per day- From Europe/USA and others to Thailand: USD 1,000 per day• The executive director is not entitled to a standard monthly fee or other forms of remuneration.• To align with approval of the shareholders on considering bonus payment for each director, the return on parent shareholders funds/2 must be exceeded 15%. When this threshold is reached, a bonus equals to 0.50% of annual consolidated net profit above a 15% return on parent shareholders funds which will be allocated equally among all non-executive Directors.

Note: /1 Remuneration of the Board of Directors and sub- committees was approved by the shareholders at the Annual General Meeting of the Shareholders on 30 January 2012, and there have been no changes after that. However, the remuneration package is proposed to shareholders for acknowledgement pursuant to the Best Practices of Corporate

Governance by the SET.

/2 Return on parent shareholders funds

= TTA consolidated net profit – unrealized exchange gains or losses

Paid up share capital + share premium + legal reserve + retained earnings

Table : Remuneration for the Board and Board Committees for the 2014 Financial Year

Committees Type of Remuneration Rate

Non-executive directors Standard monthly fees Baht 150,000 - Chairperson Baht 35,000 per director

Attendance fee per meeting Baht 54,000 - Chairperson Baht 45,000 per director

Travelling allowance for directorswho reside outside Thailand

From Asia : USD 500/dayFrom Europe/USA/others :USD 1,000/day

Bonus Bonus=0.5% of annual consolidation net rofit above 15% ROE*

Audit Committee Attendance fee per meeting Baht 48,000 - Chairperson Baht 40,000 per member

Nomination and Remuneration Committee

Attendance fee per meeting Baht 36,000 - Chairperson Baht 30,000 per member

Risk Management Committee Attendance fee per meeting Baht 18,000 – ChairpersonBaht 15,000 per member

Corporate Governance Committee Attendance fee per meeting Baht 18,000 - Chairperson Baht 15,000 per member

* Return on parent shareholders funds

= TTA consolidated net profit – unrealized exchange gains or losses

Paid up share capital + share premium + legal reserve + retained earnings


T H O R E S E N T H A I A G E N C I E S P L C176 MANAGEMENT STRUCTURE

Remuneration and Bonus for the Board and Board Committees for the 2014 Financial Year

Name

Board of Directors Attendance FeeTotal

(Monthly Fee andMeeting

Allowance)

TravelAllowance

(only foreign

directors)(USD)

Standard Monthly

Fee Bonus

Board of

DirectorsAudit

CommitteeExecutive Committee

Nomination and

RemunerationCommittee

Corporate GovernanceCommittee

RiskManagement Committee

1. Mr. Prasert Bunsumpun 1,800,000 - 540,000 - 1,200,000 - - - 3,540,000 -

2. Mr. Chalermchai Mahagitsiri - - - - - - - - - -

3. Mr. Jean Paul Thevenin * 280,000 - 225,000 - 360,000 - - - 865,000 -

4. Mr. Chia Wan Huat Joseph 420,000 - 450,000 - 480,000 - 15,000 - 1,365,000 -

5. Mr. Krish Follett 420,000 - 450,000 576,000 - - - 72,000 1,518,000 -

6. Mr. Santi Bangor 420,000 - 450,000 480,000 - 144,000 18,000 - 1,512,000 -

7. Ms. Ausana Mahagitsiri 420,000 - 315,000 - - 120,000 - - 855,000 -

8. Mr. Mohammed Rashed Ahmad M. Al Nasseri 420,000 - 270,000 - - 90,000 - - 780,000 18,000

9. Mr. Yves Barbieux 420,000 - 270,000 - - - - - 690,000 13,000

10. Mr. Cherdpong Siriwit 420,000 - 315,000 440,000 - - - - 1,175,000 -

Total 5,020,000 - 3,285,000 1,496,000 2,040,000 354,000 33,000 72,000 12,300,000 31,000

Note: * Mr. Jean Paul Thevenin became a Board member on 30 January 2014

Remuneration and Bonus for the Board and Board Committees who resigned during the financial year 2014

Unit: Baht

NameBoard of Directors Attendance Fee Total (Monthly Fee and

Attendance Fee)Monthly Fee Bonus Board of Directors

1. M.L. Chandchutha Chandratat - - - -

2. Mr. Ghanim Saad M. Alsaad Al-Kuwari 255,161 - - 255,161

Total 255,161 - - 255,161

Note: - M.L. Chandchutha Chandratat resigned from the Board of Directors on 30 January 2014 - Mr. Ghanim Saad M. Alsaad Al-Kuwari resigned from the Board of Directors on 9 May 2014

Remuneration of Executives

Remuneration of executives in the form of salary and bonus and other monetary benefits are as follows:

Unit : Baht millions

Total number of executive during financial year/Average number of executive per year

(full time equivalent)

2014

Total number of Executive during financial year/Average number of

executive per year (full time equivalent)

2013

Total salary and bonus 10 persons/5.75 persons Baht 56.32million

10 persons/7.37 persons Baht 67.39million

Other benefits (which include social security and provident fund contributions by TTA)

10 persons/5.75 persons Baht 6.45 million

10 persons/7.37 persons Baht 10.17 million

Note: There are total five (5) executives at the end of FY 2014. There are total ten (10) executives during FY 2014 and five (5) executives resigned during the financial year.

Unit: Baht


Remuneration of the directors and executives of four core subsidiaries which are Thoresen Shipping Singapore Pte. Ltd., Mermaid Maritime Plc., Unique Mining Services Plc., and Baconco Co., Ltd. are as follows:

4.2 Thoresen Shipping Singapore Pte. Ltd.

(1) Remuneration in Cash a) No cash remuneration paid to directors of Thoresen Shipping Singapore Pte. Ltd. b) Total cash remuneration for two executives of Thoresen Shipping Singapore Pte. Ltd. for the financial year ended 30 September 2014 consisted of salary and bonus amounted to SGD 995,605.

(2) Other remuneration

Other remuneration of directors - None -

Other remuneration of executives - None -

4.3 Mermaid Maritime Public Company Limited

(1) Remuneration in Cash

a) Total remuneration of seven directors of Mermaid Maritime Public Company Limited for the financial year ended on 30 September 2014

Remuneration and Bonus for the Board and Board Committees of Mermaid Maritime Plc. for the 2014 Financial Year

Unit: Baht

Name

Board of Directors Attendance Fee Total(Monthly Fee andMeeting

Allowance)

Travel Allowance

(Only foreign directors)

(USD)Monthly

Fee BonusAudit

CommitteeExecutive Committee

Nomination Committee

Remuneration Committee

Risk Management Committee

1. Mr. Prasert Bunsumpun 900,000 - - 720,000 - - - 1,620,000 -

2. Mr. Chalermchai Mahagitsiri - - - - - - - - -

3. Mr. Chia Wan Huat Joseph - - - - - - - - -

4. Mr. Jean Paul Thevenin 600,000 - 420,000 480,000 138,000 138,000 207,000 1,983,000 -

5. Mr. Toh Wen Keong Joachim 645,000 - 450,000 - 225,000 150,000 - 1,470,000 660,000

6. Mr. Ng Cher Yan 645,000 - 675,000 - 150,000 225,000 150,000 1,845,000 660,000

7. Mr. Jan Joseph Skorupa * 600,000 - - - 138,000 138,000 - 876,000 -

Total 3,390,000 - 1,545,000 1,200,000 651,000 651,000 357,000 7,794,000 1,320,000

Note : * Mr. Jan Joseph Skorupa was appointed as a director on 21 October 2013.

b) Total remuneration of executives for the financial year ended on 30 September 2014 consisted of salary and bonus amounted to Baht 21,927,324.


Other remuneration of directors - None -

Other remuneration of executives

The Company provides provident fund at the contribution rate of 7% of each based salary. For this financial year ended on 30 September 2014, the Company paid such contribution for 2 executives at the amount of Baht 294,000.



4.4 Unique Mining Services Public Company Limited

(1) Remuneration in Cash

a) Remuneration of eight directors for the financial year ended on 30 September 2014

Name-SernameBoard of Directors

Audit Committee

Nomination and Remuneration

CommitteeExecutive Committee Total

1. Pol. Gen. Chidchai Vanasatidya No remuneration due to receiving monthly fees.

2. Mr. Chalermchai Mahagitsiri 170,000 - - - 170,000

3. Mr. Ekavaj Amornvivat 315,000 162,000 - - 477,000

4. Mr. Suchart Thammapitagkul 300,000 135,000 15,000 - 450,000

5. Pol.Lt.Gen. Kamrob Panyakaew 300,000 120,000 - - 420,000

6. Mr. Taratorn Wongprasat 285,000 - - - 285,000

7. Mr. Chia Wan Huat Joseph 185,000 - - - 185,000

8. Mr. Somporn Chitphentom No remuneration received as being an executive director of TTA being its parent company.

Director who resigned during the financial year 2014 Ms. Ausana Mahagitsiri 250,000 - 7,500 - 257,500

Total 2,244,500

b) Total remuneration of executives of Unique Mining Services Plc. as of 30 September 2014 (Unit: Million Baht)

Detail Number of persons 2014 Number of persons 2013

Total salary 4 6.81 5 6.18

Total bonus 4 - 5 -

Total 6.81 6.18

Note : 2014 : 1) Mr. Krisda Leeaphorn, 2) Mrs. Pakanat Kiratikosolrak , 3) Mr. Tan Teo Song , and 4) Mr. Vasin Pooltavee 2013 : 1) Mr. Sermsak Yangyuen, 2. Mr. Anan Petchropas, 3) Mr. Boonta Chantatham, and 4) Mr. Pongsak Paraprom,and 5) Mr. Krisda Leeaphorn.


Other remuneration of directors -None -

Other remuneration of executives

The Company provides provident fund to executives of Unique Mining Services are as follows:(Unit: Million Baht)

Detail Number of persons 2014 Number of persons 2013

Provident fund 3 0.16 - -

Note : 2014 : 1) Mr. Krisda Leeaphorn, 2) Mr. Tan Teo Song, and 3) Mr. Vasin Pooltavee



4.5 Baconco Co., Ltd.

(1) Remuneration in cash

a) No cash remuneration paid to directors of Baconco Co., Ltd. b) Total cash remuneration to executives of Baconco Co., Ltd. for the financial year ended on 30 September 2014 consisted of salary and bonus amounted to Baht 11,918,206.

(2) Other remuneration Other remuneration of directors -None-

Other remuneration of executives -None-

5. Personnel

As of 30 September 2014, TTA has a total workforce of 68, consisting of one President and Chief Executive Officer, three Executive Vice Presidents, and 64 employees as detailed below.

Main Business Units Number of Employees (Only TTA)

1. Corporate Finance and Accounting 20

2. Corporate Human Resource 4

3. Group Operations 20

4. Group Business Development 15

5. Corporate Risk Management and Internal Audit 9

Total 68

Group of Business Number of Employees

1. Group Transport 93

2. Group Energy 396

3. Group Infrastructure 773

- Total number of employees of TTA and its subsidiaries was 1,330 (excluding the crew on-board).- Total remuneration of employees of TTA and its subsidiaries, excluding management and executive directors of TTA, such as salary, wage, and bonus (excluding the crew on-board) as of 30 September 2014 was Baht 1,031,240,864.- TTA contributed the provident funds and social security funds to its employees (excluding the crew on-board) at the total amount of Baht 42,605,212.- Individual Development Plans can be found under the heading Corporate Governance Policy.



INCoME STRUCTURE

Group of BusinessGenerated

by

% of Shareholding

by the Company

Revenue (Baht)

2012(Restated) %

2013(Restated) %

2014%

Group Transport Shipping 100 3,594,454,975 22 4,811,880,466 26 6,901,909,046 32

Group Energy Mermaid 57.4 5,721,166,841 34 8,243,401,118 44 10,088,183,138 46

Coal/Group Infrastructure UMS/1 88.7 3,427,649,084 21 1,931,065,483 10 1,038,473,327 5

Fertiliser/Group Infrastructure Baconco/2 100 3,375,802,043 20 3,229,389,323 17 3,192,005,566 15

Others/Group Infrastructure GTL/CMSS 51/100 228,134,127 1 247,352,282 1 210,667,192 1

Other Revenues 315,369,280 2 289,611,294 2 339,592,667 1

Total 16,662,576,350 100 18,752,699,966 100 21,770,830,936 100

Note: /1 indirectly held through Athene Holdings Ltd.

/2 indirectly held through PM Thoresen Asia Holdings Plc.

INCoME STRUCTURE


REMUNERATIoN of AUdIToRS

Audit Fee

For the financial year 2014, the Company and its subsidiaries paid audit fees to auditing firms for a total of Baht 22,114,829.

Non-Audit Fee

For the financial year 2014, the Company and its subsidiaries paid non-audit fees to auditing firms for a total of Baht 7,523,804, primarily relating to auditing the subsidiaries’ compliance to the conditions in the Approved International Shipping Enterprise (“AIS”) scheme, BOI’s certificates, tax filling and tax advice.

REMUNERATIoN of AUdIToRS


RISK fACToRS

Based on the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) framework and in line with our organizational structure and operating model, TTA designed and implemented an enterprise risk management (“ERM”) framework with a corresponding ERM policy and process.

The Group’s risk governance structure comprises of:

• The Board of Directors monitors and reviews the overall effectiveness of risk management framework and risk limits to manage overall risk exposure

• The Risk Management Committee (“RMC”) provides an independent oversight on the risk exposures faced by the Group. Their duties include;

- Overseeing the Group Risk Management- Reviewing the overall risk management guidelines/

framework- Assessing the adequacy and effectiveness of the risk

management policies and process- Reviewing risk exposures and recommending risk limits• All business executives are responsible for monitoring

their respective risks and adhere to the policies and limits set by the Risk Management Committee and the Board

• The Corporate Risk Management function assists the RMC and coordinates all business executives in managing all major risks

Enterprise Risk Management (“ERM”) framework provides a holistic and systematic process for identifying, analyzing and managing risks to better prepare the Group to respond to uncertainties and leverage new business opportunities to maintain its competitive edge. The Board of Directors, assisted by the Risk Management Committee, is responsible for overseeing the risk management of the group, where key risks and the progress of significant projects are reviewed, monitored and discussed with the management.

As part of the Group’s risk management processes, extreme / high risks associated with value drivers to achieve corporate strategies are identified. Risks are assessed with regards to their impact on the Group’s operations, financial performance and reputation. Mitigating actions are established and closely monitored.

All investment proposals need to include an assessment of key factors which could carry potential risks, such as alignment with strategic objectives, operational controls, financial viability, potential contingent liabilities, specific country laws and regulations, technical competency and available resources, for the approving authority’s deliberation.

Risk criteria and limits are subject to periodic reviews to ensure that they continue to support business objectives, address business risks effectively and take into consideration the prevailing business climate, opportunity and risk appetite within TTA. The risk profile and heat-map are reviewed by the Board on a quarterly basis. Risks identified and associated mitigating controls are also subject to audit as part of operational and financial audit programs.

Strong management commitment in driving Group-wide ERM framework and processes has enabled the Group to be better equipped in managing risks in the dynamic business environment, both locally and internationally. Risk management is integrated into the day-to-day business operations to enable early risk detection for proactive risk management. The company ensures the continuity of our business operations by taking risks into account when making strategic decisions and planning, while also preemptively controlling risks in our business plans and execution.

All risk factors mentioned in this Annual Report, particularly those outlined in this section, refer to key future uncertainties which were identified from the company’s strategic planning, business model, external environment, and financial system. However, there may be risks unknown to TTA and other risks, currently believed to be immaterial, which could turn out to be material. Risks may materialize individually, simultaneously or in combination and could significantly affect the Group’s:

• Short and long-term business and prospects; • Earnings and cash flow; • Overall financial results and product demand; • Current asset values; • Future asset values and growth potential; • Safety plus long, medium and short-term health; • Environmental effects; or • Group or business unit reputation.

RISK fACToRS


Business Continuity Management (“BCM”) is part of the Group’s ERM initiatives to address and manage potential threats and disruptions to operations arising from events such as an epidemic outbreak, act of terrorism, natural calamities and damage to critical facilities. The BCM Committee oversees the implementation of the Group’s BCM program and develops action plans to mitigate threats with the aim of resuming key business operations within a pre-established targeted timeframe. Business units at each location has established their specific business continuity and crisis response plans, which are continually reviewed and tested, to ensure effective response to unforeseen events while minimizing operational disruptions.

To bolster crisis management competency within TTA, crisis communications training for key spokespersons is conducted to prepare them to communicate effectively with the media and stakeholders, and to familiarize them with possible scenarios that may play out during a crisis. In addition, during the year, the different locations within the Group regularly conduct fire and evacuation drills on board rigs, vessels and as well as the office. Drills are also held to test critical enterprise systems and applications, and to enable disaster recovery plans to be tested and reviewed to ensure that IT systems and applications can be restored and resumed within the stipulated time-frame. Post-mortem analyzes are performed to refine action plans with the gaps identified from the drills. All BCM are reviewed, tested and refined periodically to enhance the Group’s overall operational resilience.

Fraud Control Plan is an important component of Risk Management Framework. A high standard of business conduct and corporate governances plays an important role for our business expansion and sustainable growth. Thus, Thoresen Thai Agencies has adopted Code of Business Conduct as a set of professional practice guideline to assist all Board members, management and employees in their daily activities. The Whistle Blowing and Non-retaliation Policy and Procedures are one of many policies lies under the Code of Business Conduct. The Company communicates to employees to follow the policy and procedures and requires all employees to confirm their acknowledgement of the Code of Business Conduct at the new employee orientation. HR delivers training periodically to raise awareness while Internal Audit reviews and raises any internal control weaknesses to the relevant process owners, management, Audit Committee and the Board.

The Company has also established a “Postbox” as communication channel for all stakeholders to share their complaints, compliments, comments or suggestions regarding the company’s governance and business ethic directly to the Audit Committee, which is consisting of the independent directors, at the postal address:

Thoresen Thai Agencies Plc.P.O. Box 12, SCB Post OfficeLumpini, Pathumwan, Bangkok 10330,Thailand [email protected]

The assigned Internal Auditor has exclusive access to the post box to collect the mails twice a month. All received mailed will be forwarded to the Audit Committee who review them, consider appropriate actions and report to the Board of Directors at the quarterly meeting.

Strategic Risks

We cannot guarantee that any business objectives will be realized, although we believe we have been prudent in our strategic plans and assumptions. Achievement of anticipated results is subject to substantial risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties materialize or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated or projected.

Risk from formulating an inappropriate strategic plan

The risk that is the medium and long-term profitability of the Group could be adversely impacted by the failure to identify and implement the correct strategy, and to react smartly to changes in the business environment. TTA manages this risk by creating a system and process to periodically review its strategic plans which have been defined by each business unit with focus on preserving its competitiveness, investment expansion to supplement business value. Every month, TTA Executive Committee meets to monitor Group performance and exchange views on adjusting business plans and short-term strategies to ensure confidence in reaching such goals. This includes prompt report to CEO if there is a need to change TTA’s business direction. In addition, information from reliable institutions and other sources are compared to check information creditability and analyze differences among various assumptions. TTA also consults with external experts and enhances internal skills to forecast economic, social and other related conditions.

Deterioration of general economic conditions may significantly reduce our operating earnings and impair our ability to access capital markets at a reasonable cost.

Our operating businesses are subject to normal economic cycles affecting the economy in general or the industries in which they operate. Our transport, energy and logistics businesses regularly utilize debt as a component of their capital structures. These businesses depend on having access to borrowed funds through the capital markets at reasonable rates. To the extent that access to the capital markets is restricted or the cost of funding increases, the Group may be unable to maintain the planned rate of growth.

RISK fACToRS


The Group’s exploration and development of new projects might be unsuccessful, expenditures may not be fully recovered and depleted or reserves may not be replaced.

TTA plans to identify new investment projects through its business development plan as a means of generating shareholder value. The Group may not be able to source or maintain adequate project financing; or may be unable to find willing and suitable joint venture partners to share the cost of developing large projects. Business combinations entail a number of risks including the effective integration of acquisitions to realize synergies, significant one-time write-offs or restructuring charges, and unanticipated costs and liabilities. The Group may also be liable for the past acts, omissions or liabilities it has acquired that are unforeseen or greater than anticipated. The Group may also retain unforeseen liabilities for divested entities if the buyer fails to honor all commitments.

Joint ventures, strategic partnerships or non-managed operations may not be successful and may not comply with the Group’s standards.

The Group participates in several joint venture and partnership arrangements, and it may enter into others, all of which necessarily involve risk. Whether or not the Group holds majority interests or maintains operational control in its joint ventures, its partners may.

• Have economic or business interests or goals that are inconsistent with, or opposed to, those of the Group.

• Exercise veto rights to block actions that the Group believes are in its or the joint venture’s best interests.

• Be unable or unwilling to fulfill their obligations under the joint venture or other agreements, such as contributing capital to expansion or maintenance projects.

Where these joint ventures are controlled and managed by others, the Group may provide expertise and advice but has limited control over compliance with its standards and objectives; such that partners may take action contrary to the Group’s policies with respect to its investment.

The Group is reliant on the reputation of its brands and the protection of its intellectual property rights.

TTA General Business Code of Conduct governs how TTA and its individual companies conduct their affairs. It is a challenge for us to ensure that all our employees comply with the principles. Failure – real or perceived – to follow these principles, or other real or perceived failures of governance or regulatory compliance, could harm our reputation. This could impact our license to operate, damage our brand, harm our ability to secure new resources, limit our ability to access the capital market and affect our operational performance and financial condition.

In addition, the value of the Group’s brands can be influenced by a number of other factors, some of which may be outside the Group’s control, including commoditization, consumer preference and perception, failure by the Group or its associates to ensure compliance with the significant regulations, or other factors affecting consumers’ willingness to purchase goods and services, including any factor which adversely affects the reputation of those brands.

Given the importance of brand recognition to the Group’s business, the Group has invested considerable effort in protecting its intellectual property, including registration of trademarks and domain names. However, the controls and laws are variable and subject to change. Any widespread infringement, misappropriation or weakening of the control environment could materially harm the value of the Group’s brands and its ability to develop the business.

The Group requires organizational capability to manage changes in key personnel and senior management.

In order to develop, support and market its products, the Group must hire and retain highly skilled employees with particular expertise. The implementation of the Group’s strategic business plans could be undermined by failure to recruit or retain key personnel, the unexpected loss of key senior employees, failures in the Group’s succession planning and incentive plans, or a failure to invest in the development of key skills. Some of the markets in which the Group operates are experiencing economic growth and the Group must compete against other companies inside and outside the industry for suitably qualified or experienced employees. Failure to attract and retain these employees may threaten the success of the Group’s operations in these markets as it could adversely affect our reputation and ability to operate safely and cost-effectively. Additionally, unless skills are supported by a sufficient infrastructure to enable knowledge and skills to be passed on, the Group risks losing accumulated knowledge if key employees leave the Group.

The Group is exposed to inherent risks in relation to technology and systems.

To varying degrees, the Group is reliant upon certain technologies and systems (including IT systems) for the running of its business, particularly those which are highly integrated with business processes. Disruption to those technologies or systems could adversely affect the efficiency of the business, notwithstanding business continuity or disaster recovery processes. The Group could lose customers, fail to attract new customers or incur sub-stantial costs or face other losses. Therefore, the Group makes substantial investments in technologies or systems to maintain a competitive advantage.

RISK fACToRS


External Risks

Economic environment The global macroeconomic environment as well as financial and commodity market conditions influence our operating results and financial condition as our business model involves trading, treasury, interest rate and foreign exchange risks. The global economic downturn could cause our customers to postpone their businesses and investments or initiate other cost-cutting measures to improve their financial position. These factors could result in reduced demand for our products and services, which would in turn affect TTA’s operating results.

Country-specific risks

TTA conducts business in many countries. Operating in these counties involves certain risks, such as civil unrest, terrorism acts, economic and political instability, trade protection, imposition of exchange controls, nationalization of private assets, and debts. All these risks require TTA to have a high aptitude for risk management. In addition, there may be uncertainties in the legal environment in certain regions. Although we strive to comply with all such laws and regulations, unintentional violations could have material adverse effects on our business.

Natural Disasters

Earthquakes, floods, storms and the possible effects of climate change could result in significant environmental incident, commercial loss or interruption to operations. The Group’s insurance may not cover every potential loss and adequate coverage at reasonable rates is not always obtainable. Any occurrence not fully covered by insurance could have an adverse effect on the Group’s business.

Attacks by Pirates The Group’s vessels and drilling rigs are exposed to the risk of attacks by pirates. In the event that such attacks occur and the vessel or drilling rig is captured, destroyed or damaged in excess of the insurance coverage, or lead to injuries or loss of personnel, the Group’s financial condition and results of operations could be materially and adversely affected.

Community disputes where we operate.

Some of the Group’s current and potential operations are located in or near communities that may regard the operation as being detrimental to their environment. Community expectations are typically complex with the potential for multiple inconsistent stakeholder views that may be difficult to resolve. Stakeholder opinion and community acceptance can be subject to many influences, such as the related industries, operations of other groups, local, regional or national events in other places where we operate. In the extreme, our operations may be a focus for civil unrest or criminal activity.

The Group is exposed to risks related to corporate responsibility.

The reputation of the Group and the value of its brands are influenced by a wide variety of factors, including the perception of key stakeholders and the communities in which the Group operates. The social and environmental impacts of business are under increasing scrutiny, and the Group is exposed to the risk of damage to its reputation if it fails to demonstrate sufficiently responsible practices, or fails to comply with regulatory requirements, in a number of areas such as safety and security, sustainability, environmental management, human rights and support for the local community.

Regulatory changes may adversely impact our future operating results.

Legal and regulatory developments, including changes in regulations regarding production, product liability, distribution, importation, labeling, packaging, consumption, or advertising; changes in tax law, rates or requirements (including with respect to the impact of excise tax increases) or accounting standards; changes in the regulation of banks and other major financial institutions; and changes in environmental laws, health regulations and the laws governing labor and pensions, is not yet clear whether or not these initiatives will result in significant changes to existing laws and regulations. Many of the regulations associated with enacted legislation have yet to be written or the costs of compliance associated with enacted legislation may not be fully known or understood. These initiatives and the related costs to comply with such initiatives could have a significant negative impact on our operating businesses, as well as on the businesses that we have a significant but not controlling economic interest. Accordingly, we cannot predict whether such initiatives will have a material adverse impact on our consolidated financial position, results of operations or cash flows.

Financial Risks

Dividends from subsidiaries and associated companies

Most of the Company’s assets are its shareholding interests in its subsidiaries and associated companies. The ability of the Company to meet its obligations such as the payment of principal and interest on its debt financing is therefore subject to the up-streaming of dividends from its subsidiaries and associated companies.

Both the timing and ability of the Company’s subsidiaries and associated companies to pay dividends are limited by applicable laws, the terms of each subsidiary’s or associated company’s indebtedness, financial condition, results of operations, and future business prospects. Furthermore, payment of dividends may be subject to withholding taxes that will reduce the net amount of dividends received from its subsidiaries and associated companies.

RISK fACToRS


In the event that any of the Company’s subsidiaries or associated companies does not pay dividends or do so irregularly, or if such dividend payments are subject to materially high withholding taxes, the Group’s financial condition and results of operations could be materially and adversely affected.

The Company’s shareholding interests in these companies may be diluted due to potential capital calls if the Company elects not to participate in capital raising activities. The Company’s subsidiaries or associated companies, moreover, may have other shareholders whose business interests and activities may be in direct or indirect competition with the Group’s businesses. As a result, the Group may be exposed to conflicts of interest with the other shareholders in these companies.

Investments are unusually concentrated and fair values are subject to loss in value.

Our investment portfolio is diversified in the various industries. A significant decline in the fair values of our larger investments may produce a material decline in our consolidated shareholders’ equity and our consolidated book value per share. Under certain circumstances, significant declines in the fair values of these investments may require the recognition of other-than-temporary impairment losses.

A large percentage of our investments are held in our transport, subsea services and logistics companies and a decrease in the fair values of our investments could produce a large decline in statutory surplus. Our large statutory surplus serves as a competitive advantage, and a material decline could have a material adverse affect our ability to invest in new businesses thus affecting our future profitability.

The global macroeconomic environment as well as financial and commodity market conditions influence our operating results and financial condition as our business model involves trading, treasury, interest rate and foreign exchange risks.

TTA subsidiaries and equity-accounted investments are subject to differing economic and financial market conditions throughout the world. Political or economic instability affects such markets. TTA uses debt instruments such as bonds and commercial paper to raise significant amounts of capital. Should our access to debt markets become more difficult, the potential impact on our liquidity could have an adverse effect on our operations. Treasury risks include, among others, exposure to movements in commodity prices, interest rates and foreign exchange rates, counterparty default and various operational risks. As a global company, we are exposed to changes in currency values and exchange controls. While we undertake some currency hedging, we do not do so for all of our activities. The resulting exposure could affect our earnings and cash flow.

The Group seeks to manage its exposure to interest rate volatility and minimize its interest costs. Interest rate volatility is mitigated through actively managing the mix of fixed and floating interest rates on our borrowings and through the use of derivatives, such as interest rate swaps, on our longer-term borrowings. Furthermore, we actively manage the overall tenor of our loan portfolio matched with operation cash flow.

The Group is exposed to a variety of risks associated with its ability to borrow and satisfy debt covenants.

The Group is reliant on having access to borrowing facilities to meet its expected capital requirements. The majority of the Group’s borrowing facilities are only available if the financial covenants in the facilities are complied with. If the Group is not in compliance with the covenants, the lenders may demand the repayment of the funds advanced. If the Group’s financial performance does not meet market expectations it may not be able to refinance its existing facilities on terms it considers favorable. The availability of funds for future financing is, in part, dependent on conditions and liquidity in the capital markets.

The Group’s liquidity and cash flow expectations may not be realized as expected, inhibiting planned expenditure.

The Group’s ability to fund planned expenditure such as capital growth, mergers and acquisitions, innovation and other obligations may falter if its cash position proves inadequate. Our ability to weather a major economic shock could be compromised by insufficient cash reserves, a reduction in the value of existing reserves, or restricted access to our cash reserves.

TTA has established a well-functioning system for cash flow planning, budgeting, and forecasting to assess the short-term and medium to long-term liquidity needs. The company has implemented a variety of prudent financial measures to fulfill its overall liquidity needs, including centralizing cash management, maintaining a reasonable level of funds, and gaining access to adequate and committed credit facilities. An adequate capital reserve and a stable cash flow from operating activities enabled TTA to manage its liquidity and borrowing risks, thus ensuring financial stability for the company.

Operational Risks

THORESEN SHIPPING : Risks relating to dry bulk shipping business

The dry bulk shipping company, as an owner, operator and charterer of ocean-going vessels operating without any geographical limitations other than those imposed by political sanctions, Hull and Machinery Insurance policies, and safe Navigational practices, is exposed to risks of marine disaster, environmental mishaps resulting in

RISK fACToRS


substantial claims, cargo/property loss or damage and business interruptions due to accidents or other events caused by mechanical failure, human error, political action in various countries, labor strikes, terrorist actions, piracy, adverse weather conditions and other such circumstances and events. These factors could result in increased costs, reputational impact and / or loss of revenues. However, to mitigate most of these risks, which are standard exposures for an International Ship owner/operator, insurance coverage is available in the international insurance industry. Accordingly, the dry bulk company is adequately covered against such aforesaid circumstances and events, although insurance premiums do vary with a company’s perceived exposure to these risks and geographical areas traded.

The operations of the dry bulk company are subject to extensive and changing regulatory legislation. Non-com-pliance with these regulations may result in the detention of ships leading to loss of revenues or claims from charterers, and compliance with new regulations may require significant expenses for ship modifications or changes in operating procedures. However, the Company is vigilant on these issues and maintained operations in compliance with internationally prescribed safety and technical standards, resulting in zero Port State Control detentions in FY 2014.

The operations of the ships require qualified, skilled personnel to be employed as officers and crew to them. Likewise, the management of the company requires qualified, skilled managers at the corporate level with appropriate technical knowledge and experience. Sourcing and retaining such personnel is crucial for the successful business operations of the dry bulk company. Due to the adoption of fair and reasonable staffing policies, the company has been successful to date in sourcing and retaining highly skilled and qualified personnel. The company continues a number of initiatives to attract and retain talent, and therefore does not expect any future cause for serious concern in this regard provided they are observed.

As the dry bulk company increases its level of contracts of affreightment (COAs), and equally its period charter in activity, the exposure to changes in the oil price also rises. To mitigate this risk, the company actively hedges its physical bunker requirements for its COAs. This allows the company to lock away a significant portion of its costs associated with voyage profit and loss estimates.

The shipping industry and market is cyclical, experiencing volatility in profitability, vessel values and freight rates, resulting from changes in the supply of and demand for shipping capacity, as explained in the section on “Business Review and Outlook of Dry Bulk Shipping” of this Report. These cycles vary in timing and length. In the Company’s opinion, given the uncertainty and the extreme volatility in the market where rates can shoot up or collapse very quickly, it is always prudent to secure future earnings, at

reasonably high freight rate whenever possible, as a cush-ion against a sudden and, more particularly, a sustained collapse of the freight rates in the spot market. To limit this volatility, the Group’s objective is a diversified and balanced fleet employment. The Group employs a certain percentage of the fleet on period time charters, which are supplemented by contracts of affreightment. The Group also diversifies its cargo types and trading areas and prefers not to specialize in any one cargo type.

The Company also engages actively in hedging potential freight rate collapse through a structured use of Forward Freight Agreements (FFAs), against physical charters and contracts. The Company does NOT use FFAs as a speculative tool against the market, but only to protect income in the case of a sudden rate drop where there exists a true physical exposure. The Company’s exposure to the market is measured on a daily basis, and board approved limits have been established to ensure the protection of freight income is maintained.

The demand side of the Company’s business is generated by the quantity of cargo its vessels are required to transport. The generation of this demand is mainly dependent on World Trade and Economic Growth. Severe depression in growth and trade, combined with alternative sourcing geographies for raw materials could affect the demand for ships. A significant reduction in demand can lead to a fall in freight rates.

As with any commercial enterprise, the dry bulk company is exposed to counterparty risk. This is particularly true in times of financial hardship. However, the company is always conscious of the counterparty risk associated with its period charters and COA’s and takes appropriate evaluative steps before engaging in either. Due diligence on credit worthiness and reputation of all prospective Charterers is undertaken prior to agreeing counterparty. Furthermore, regardless of credit-worthiness, the dry bulk company maintains rigid payment standards. It is for this reason that through the depressed market of the last year, the company did not suffer any significant losses on account of defaults by charterers.

The company’s revenues are generated from a number of customers and the company is not dependent on any single customer for the majority of its business. As such, the company is not exposed to any risk of concentration of its business with any one customer and any loss of business from one such customer shall not have any significant impact on the company’s business and will not result in sudden and significant loss of revenues.

Capacity Replacement and Expansion Risk

The ships have a finite life, and the Company must continuously renew its fleet by replacing the scrapped / sold ships with younger and bigger ships in order to maintain capacity in terms of fleet size. The Company may not have been able to buy enough second-hand (or new

RISK fACToRS


ships for immediate / early delivery) ships and the inability to buy reasonably priced ships exposed the Company to the risk that the Company could not replace its capacity as a result of the sale of the old ships.

At the end of 2011, our fleet size was reduced substantially to 15 ships due to an anticipated downturn and the aged fleet becoming irrelevant. The boom in the International Shipping market in the preceding few years, had meant the values (cost) of second-hand vessels were at unprece-dented highs and the Company did not deem it prudent to be buying ships at such inflated values given an anticipated market fall, and therefore exposing itself to the risks of an impairment charge on its assets as a result of a fall in the market values of ships in case of a sustained downturn. However, in about three years (2012 – 2014) the Company sold only one old ship, while actually receiving two new builds and acquiring 8 second-hand ships at reasonable values. It does appear that this risk of not being able to replenish or rejuvenate the Fleet is on its way to being reduced considerably, for the current time, if not totally eliminated, and in the immediate future. By procuring these assets now, and replacing the older tonnage which was scrapped in recent years, the Company has lowered its average depreciation and operating expenses, providing for a more secure future as rates struggle to return to previous levels.

MERMAID: Risks relating to the Group’s Offshore Services Business

Mermaid provides offshore services, subsea and drilling business to the oil and gas industry, and its offshore business is affected by fluctuations in the prices of oil and gas, which impact the level of activity in oil and gas exploration, development, and production in South-East Asia, Middle East and North-sea where Mermaid is active.

Depending on the market price of oil and gas, oil and gas companies may cancel or reduce their activities, thus reducing the demand for the Mermaid’s offshore services. Any prolonged period of low drilling and production activity would likely have an adverse effect on the Company’s business and operations.

Demand for Mermaid’s offshore services is subject to periods of high demand, short supply, and high rates often followed by periods of low demand, excess supply, and low rates. The entry into the market of newly constructed, upgraded, or reactivated drilling or subsea engineering vessels will increase market supply and may inhibit the increase of rates or reduce them. Periods of low demand intensify the competition in the industry and often result in assets being idle for periods of time. Mermaid’s offshore services assets may be idle, or Mermaid may have to enter into lower rate contracts in response to market conditions in the future. Mermaid’s ability to renew these contracts, or obtain new contracts, and the terms of any such contracts will depend on market conditions at the time such contracts are being considered.

In addition, as most subsea engineering services contracts are short-term in nature, changes in market conditions can quickly affect business. Further, as Mermaid’s offshore services business is project-base; its cash flow may not always be predictable and may be uneven. As a result of fluctuation in demand, operational results may be volatile. Our strategy is to secure a number of different assets on long-term contracts. This provides a guaranteed earnings stream that is not affected by spot market conditions and provides a hedge against market volatility.

Mermaid’s offshore services business is subject to various risks inherent in the oil and gas industry, such as fires, natural disasters, explosions, encountering formations with abnormal pressures, blowouts, pipeline ruptures, and spills, including environmental mishaps resulting in substantial claims and business interruptions due to accidents or other events caused by mechanical failure, human error, political action in various countries, adverse weather conditions and other such circumstances and events. A number of these risks could have severe consequences, including loss of human life or serious injury, significant damage to Mermaid’s or its clients’ assets and equipment, environmental pollution, personal injury litiga-tion, political consequences, increased costs or loss of revenues and damage to Mermaid’s reputation. However, Mermaid purchased insurance with adequate coverage against such aforesaid circumstances and events, although insurance premiums do vary with the company’s perceived exposure to these risks.

Mermaid constantly invests substantial capital in the fleet to enhance its market position in terms of the modernization and size, and insists upon a comprehensive maintenance and repair schedule, that minimizes the risk of equipment failure. Furthermore, Mermaid maintains a solid focus on safety at all times, with a comprehensive safety management system in place, with clear safety guidelines and detailed safety training and awareness programs. In addition, clients also regularly inspect the fleet and provide their input to ongoing repair and maintenance programs.

There are a limited number of potential clients in the niche markets in which the Subsea Services business operates. Mermaid’s revenues and profitability could be materially and adversely affected if any of Mermaid’s major clients terminate its contracts or refuse to award new contracts to Mermaid and it is unable to secure new clients to replace these clients.

There are a limited number of potential clients, particularly for the drilling business, and a limited number of projects available in the niche markets that Mermaid’s offshore services business operates in. In any given year, a small number of contracts and projects account for a significant portion of Mermaid’s revenues and profitability. The loss of any single existing client for the drilling business could thus have a material adverse impact on the drilling business and potentially Mermaid’s revenues and profitability as a

RISK fACToRS


whole, if Mermaid is unable to secure new clients to replace such a client.

UMS : Risks Relating to the Group’s Coal Logistics Business

UMS imports coal from Indonesia regularly. The modes used are dry bulk vessels or ocean going barges. There are two potential risks related to this - availability of vessels and fluctuations in freight rates during any given period. UMS is well aware of these situations and addresses them through either fixed long term contracts with carriers and/or spot contracts. In the meantime, the Company’s dry bulk shipping business provides weekly updates and analysis on freight rate movements, allowing UMS to make fast and informed decisions.

Major factors that affect coal procurement and cost are:

i) Availability of supply at required specification/quality ii) Prices of required specification/qualityiii) Exchange rates

Risks related to supply availability include mine capacity and demand requirements from major importers specifically power plants from China, Japan, India and Korea. UMS is also exposed to specification and quality risks that occur in Indonesia on a regular basis. UMS identifies its import volume requirements, as well as the desired specifications and quality which are managed strictly through the coal sourcing agreements that include rejection limits and penalties.

From a pricing perspective, most of the coal indices are tied to world market rates. The price of coal will fluctuate based on global supply and demand. Therefore, price volatility of any of these factors will impact the cost of goods sold. UMS closely monitors coal price indexes and through a balanced long term fixed and spot coal sourcing agreements is able to manage the cost of goods sold.

Approximately 90% of UMS’s cost of goods sold is denominated in US dollars, while all of its revenue is in Thai Baht. This is due to the business model of importing coal from Indonesia and distributing it to domestic industries. Therefore, there is a potential exposure to foreign exchange risk. When the Thai Baht depreciates; UMS’s cost of imported raw materials will be higher. UMS manages this risk through a policy of using forward contracts for all costs of imports and is, therefore, able to considerably mitigate foreign exchange rate risk.

Competitors

Increased competition has resulted in price undercutting and overall narrowing of gross margins for coal traders. UMS continues to retain its key strategies in order to differentiate its products from competitors. For example, UMS provides consultative recommendations to customers

on the quality of coal to match each type of boiler by industry type, as well as provide advice to customers on technical and other services related enquiries. This ensures high efficiency for customers.

More recently, with increasing community concerns related to coal processing, many local and provincial government bodies are strictly enforcing or adding additional protection requirements to protect communities and the environment. UMS upgrades its facilities on an ongoing basis to meet and exceed the requirements. UMS is ISO 14001 certified. This will create a significant barrier to entry for many new players who previously invested little. Ultimately they will need to make major investments in upgrading equipment/machinery, land for stockpiles, in order to be in compliance with the changing environmental protection requirements.

Communities’ perceptions relating to environmental impacts

Coal is classified into many types including anthracite, bituminous, sub bituminous, and lignite. When coal is combusted, the oxygen in the air will react with the coal and generate the gas sulphur dioxide (SO2). If SO2 is inhaled or comes into contact with the skin, lung conditions and allergic reactions might result. At the same time, dust from coal could also cause allergies.

Currently, UMS imports bituminous and sub-bituminous coal that generates low sulphur (sulphur content is in the range of 0.1-1.5% while sulphur content in fuel oil is in the range of 0.1-3.0%). This creates less impact to the environment.

To minimize negative perceptions and the potential for adverse environmental impact to communities, UMS engages in a closed manufacturing process that complies with government regulations. Specifically, UMS reduces particulate dispersion with a closed storage system, covering coal stockyards with plastic sheets, spraying water on coal stockpiles, building high fences around the warehouse, and planting trees around the land perimeter to trap particulates. UMS also covers trucks with plastic sheets and washes the truck tires prior to dispatch in order to prevent coal falling onto roads.

BACONCO : Risk related to fertilizer business

Global and domestic fertilizer raw material prices can be volatile and therefore Baconco may be exposed to inventory adjustments, especially when the market faces a downturn or reduced margins when the market is on an upward trend. This is especially true if Baconco is not able to quickly adjust its market pricing.

While this risk cannot be completely eliminated, it is mitigated and minimized by controlling with two approaches:

RISK fACToRS


a) Maintain low inventories, therefore limiting exposure in a market down turn situation and

b) Firm pricing and discount policies together with customer management based on superior quality, therefore, enabling Baconco to retain margins when raw material prices increase.

Raw material procurement

Baconco purchases raw materials from both domestic and overseas sources. In general, supply is balanced with a 50/50 split between domestic and foreign. With Baconco’s strategic policies of low inventory and just-in-time purchase of raw materials, it may be exposed to a higher probability of raw material shortage when global supply is tight.

Baconco has established long term relations with a number of large and medium sized suppliers internationally. These suppliers continue to be very supportive of the company based on our quality commitments, adherence to contractual obligations, and prompt payment for materials. Baconco’s volume and in time purchases of raw materials from suppliers have always been met.

Domestic competition

Vietnam is a highly competitive market for fertilizers and agrochemicals. There is currently an overcapacity of NPK production in Vietnam (bulk blending and granulation). In the next several years, more projects are being planned.

Baconco has chosen a strategy of differentiation and concentrates on specialized products to limit exposure to competition. Overall, Baconco engages in over 50 different fertilizer formulas from generic market blends to highly specialized types. This is to ensure that Baconco stays ahead of the competition, which in general produces 10-15 product types.

Baconco also engages in multiple production processes, as well as value adding its products with some unique processes such as compaction, USP, and bio coating of fertilizers. Through this approach, Baconco is able to maintain the reputation of the brand and the image in the market as the high quality, high service provider with consistent innovations and is able to maintain its market share and margins.

On-time delivery of fertilizer

With Baconco’s just-in-time production policy, finished products inventory is low. This could lead to a higher probability of delivery delays to customers.

Baconco manages this risk with a good supply chain approach - through consistent and efficient communications between sales operations and the production facility. The factory knows several weeks in advance of the incoming orders. Combined with a preventative maintenance program for machineries and equipment, production capacities are consistently maintained. Finally, through automated bagging lines and loading processes, products are delivered to customers without delays.

Regulatory compliance

The Vietnamese government establishes specific standards for fertilizer formulas in order to protect consumers and penalties are enforced if products are not manufactured based on tested specifications. Baconco imports raw materials from reliable foreign and domestic suppliers and already has the reputation as a high quality producer of fertilizer. With the direction calls for innovation of production formulas, Baconco’s products are always in compliance or above stated government standards.

Cautionary statement concerning the forward looking statement

This document contains ‘forward-looking statements’. These statements can be identified by the fact that they do not relate only to historical or current facts. In particular, forward-looking statements include all statements that express forecasts, expectations, plans, outlook and projections with respect to future matters, including trends in results of operations, margins, growth rates, overall market trends, the impact of interest or exchange rates, the availability or cost of financing to TTA, anticipated cost savings or synergies, the completion of TTA’s strategic transactions and restructuring programs, anticipated tax rates, and general economic conditions. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including factors that are outside TTA’s control.

Any forward-looking statements made by or on behalf of TTA speak only as of the date they are made. TTA does not undertake to update forward-looking statements to reflect any changes in TTA’s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. The reader should, however, consult any additional disclosures that TTA may make in any documents which it publishes and/or files with the Securities and Exchange Commission. All readers, wherever located, should take note of these disclosures.

RISK fACToRS


REpoRT oN ThE SECURITIES holdING of ThE dIRECToRS ANd ExECUTIvES SECURITIES holdING by dIRECToRS The securities holding by TTA’s directors as of 30 September 2014

No. of SharesNo. of Warrant #

TTA-W3

No. of Warrant #

TTA-W4

NameAs of

30 Sept. 13As of

30 Sept. 14

Changes During the

YearAs of

30 Sept. 13As of

30 Sept. 14

ChangesDuring the

YearAs of

30 Sept. 14

1. Mr. Prasert Bunsumpun 29,484 130,000 100,516 4,742 4,742 0 1,000

Spouse 0 0 0 0 0 0 0

2. Mr. Chalermchai Mahagitsiri 155,681,388 213,428,893 57,747,505 23,586,633 17,122,393 6,464,240 17,654,301

3. Mr. Jean Paul Thevenin /1 0 0 0 0 0 0 0

Spouse 0 8,000 8,000 0 0 0 1,000

4. Mr. Chia Wan Huat Joseph 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

5. Mr. Krish Follett 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

6. Mr. Santi Bangor 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

7. Ms. Ausana Mahagitsiri 40,383,940 50,568,384 10,184,444 6,483,420 6,483,420 0 4,228,148

Spouse 0 0 0 0 0 0 0

8. Mr. Mohammed Rashed Ahmad M. Al Nasseri 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

9. Mr. Yves Barbieux 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

10. Mr. Cherdpong Siriwit 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

Total 196,094,812 264,135,277 68,040,465 30,074,795 23,610,555 6,464,240 21,884,449Note: 1/ Mr. Jean Paul Thevenin became a director on 30 January 2014 in place of M.L. Chandchutha Chandratat, the resigned director.

SECURITIES HoldING of THE dIRECToRS ANd ExECUTIvES


SECURITIES holdING by ExECUTIvESThe securities holding by TTA’s executives as of 30 September 2014

No. of SharesNo. of Warrant #

TTA-W3No. of Warrant #

TTA-W4

NameAs of

30 Sept. 13As of

30 Sept. 14

ChangesDuring

the YearAs of

30 Sept. 13As of

30 Sept. 14

Changes During

the YearAs of

30 Sept. 14

1. Mr. Krailuck Asawachatroj 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

2. Mr. Somporn Chitphentom 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

3. Ms. Urai Pluemsomran 156,076 156,076 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

4. Mr. Theerarat Piamsuphakphong 0 0 0 0 0 0 0

Spouse 0 0 0 0 0 0 0

Total 156,076 156,076 0 0 0 0 0

SECURITIES HoldING of THE dIRECToRS ANd ExECUTIvES


ShAREholdING STRUCTURE

TTA’S Top 10 ShAREholdERS The top ten shareholders of TTA as of 28 November 2014, the latest share register book closing date for the names of shareholders, are as follows:

No. Shareholders Number of Shares % of Total Number of Shares

1. Mr. Chalermchai Mahagitsiri 213,428,893 16.40

2. Raffles Resources 1 Ltd 69,802,309 5.36

3. Ms. Ausana Mahagitsiri 50,568,384 3.89

4. Thai NVDR Co., Ltd. 35,778,577 2.75

5. Nortrust Nominees Ltd. 28,021,939 2.15

6. Mrs. Suvimol Mahagitsiri 19,889,445 1.53

7. Provident Funds for the staff of Electricity Generating Authority of Thailand

11,986,300 0.92

8. K Equity Dividend LTF 11,778,500 0.91

9. Krung Thai Flexible Fund 11,287,800 0.87

10. Krungthai-AXA Life Insurance Public Company Limited 11,239,200 0.86

Total number of shares held by top 10 shareholders 463,781,347 35.64

Other shareholders 837,393,393 64.36

Total fully-paid capital as of 28 November 2014 1,301,174,740 100.00

TTA’S ShARE dISTRIbUTIoNThe share distribution by nationatity of TTA as of 28 November 2014, the latest share register book closing date for the names of shareholders, is as follows:

Share Distribution by Nationality Number of Shareholders Number of Shares

% of Total Number of Shares

Thai 23,617 1,126,640,140 86.59

Foreign 102 174,534,600 13.41

Total of Shareholders 23,719 1,301,174,740 100.00

SHAREHoldING STRUCTURE


dIvIdENdpolICy

The timing and amount of dividends, if any, will depend on our operational results, financial condition, cash requirements and availability, restrictions in financing agreements, and other factors deemed relevant by our Board. Because we are a holding company with no material assets other than the shares of our subsidiaries and affiliates, our ability to pay dividends on the common shares depends on the earnings and dividend distributions of our subsidiaries and affiliates.

TTA has established a policy to distribute dividends of at least 25% of the consolidated net profit after tax but excluding unrealised foreign exchange gains or losses, subject to the Company’s investment plans and other relevant factors. The Board may review and revise the dividend policy from time to time to reflect the Company’s future business plans, the needs for investment, and other factors, as the Board deems appropriate. However, dividend distributions may not exceed the retained earnings reported in the financial statements of the Company only.

The declaration and payment of dividends will always be subject to Thai law. For example, Thai law prescribes that the declaration and payment of dividends is subject to the discretion of the AGM on the recommendation of the

Board (for final dividends) or at the discretion of the Board (for any interim dividends). Furthermore, Thai law generally prohibits the payment of dividends other than from profits (net profits plus retained earnings less any accumulated losses) and provided that the company first maintains a minimum reserve fund of 10% of the capital of the company, or higher if determined by company regulations, and cannot be made while a company is insolvent or would be rendered insolvent by the payment of such a dividend.

Most of our subsidiaries have adhered to a policy to pay dividends to TTA at not less than 70% of their net profit, except for the smaller shipping services companies, Mermaid, UMS, and PMTA. As listed companies on the SGX-ST and MAI, respectively, and PMTA is planning to be listed on the SET, their Board of Directors must apply the same level of care and judgement when recommending dividends as the TTA Board. Mermaid’s, UMS’s, and PMTA’s possible dividend payments will depend on various factors, including return on equity and retained earnings, expected financial performances, projected level of capital expenditures and other investment plans, and restrictions on payment of dividends that may be imposed by its financing arrangements.

The Company’s dividend payment for the past five financial years

Year FY 2013(restated)

FY 2012(restated)

FY 2011(restated)

FY 2010 FY 2009

Earnings per share (Baht) (5.91) (6.35) 0.24 1.12 2.56

Dividend per share (Baht) No dividend payment No dividend payment 1.00/1 0.26 0.54

Note: /1 the Company’s dividend payment of FY 2011 at the total of Baht 1.00 per share divided into 1) the payment of an interim dividend during FY 2011 of Baht 0.50 per share, and 2) the payment of dividend at the end of FY 2011 of Baht 0.50 per share.

dIvIdENd PolICy


Corporate Governance is a structure and process of relationships between a company’s shareholders, Board of Directors, and Management with an underlying objective to enhance its long-term competitiveness and shareholder value.

At the Board of Directors’ meeting on 21 December 2011, the Board established a Corporate Governance Committee (the “CGC”) to review corporate governance practices and the Code of Business Conduct and to monitor compliance of the practices so that it remains within an ethical frame-work.

The CGC reviewed the Company’s Corporate Governance Policy, which was approved by the Board of Directors on 24 December 2012.

TTA’s corporate governance principles are as follows:

•Rule of law: Management and operations shall be in line with relevant laws, charters, regulations, and board resolutions•Accountability: all concerned parties have to be aware of their duties and responsibilities•Transparency: Business activities and operations shall be auditable and transparent•Participation: Recognition of the rights of shareholders and stakeholders to participate in company activities•Value for money: All investments and resource utilisation must meet targeted financial and economic returns

The main components of TTA’s Corporate Governance Policy are set in accordance with the guidelines of the Stock Exchange of Thailand (“SET”) are as follows:

1. Rights and Equitable Treatment of Shareholders 2. Rights of Stakeholders3. Information Disclosure and Transparency4. Structure and Responsibilities of the Board of Directors5. Business Ethics and Code of Conduct

The CGC has reviewed this report and is of the opinion that TTA has generally followed the corporate governance practices discussed herein.

The CG practices in the 2014 financial year were as follows:

1. Rights and Equitable Treatment of Shareholders

(A) GENERAL RIGHTS AND EQUALITY

TTA is accountable to its shareholders in terms of information disclosure, accounting methods, use of insider information, and conflict of interest.

TTA recognises the duty to ensure fair treatment to all shareholders. TTA has a duty to protect shareholders’ benefits and rights, which include, among other things, the rights to receive dividends and obtain relevant and adequate information from the Company on a regular and timely basis. TTA also has a duty to disseminate transparent information and ensure management accountability through shareholders’ meeting arrange-ments.

Each shareholder shall receive, prior to any shareholders’ meeting, complete and sufficient information concerning the proposed agenda attached to the meeting notification.

All shareholders are given proxy forms, allowing them to appoint their authorised representative or select an independent director to attend and vote at the meetings on their behalf.

To increase communication channels and shareholder interaction, the Board has implemented a policy to give shareholders an opportunity to propose agenda items for future shareholders’ meetings. Shareholders are able to send their questions to us and propose agenda items to the Board for consideration via our website prior to any shareholders’ meetings. Guidelines that allow sharehold-ers to nominate directors are also posted on our website.

(B) SHAREHOLDERS’ MEETINGS

TTA conducts shareholders’ meetings in accordance with applicable laws and generally accepted practices, which allow shareholders to exercise their rights fully and in an informed manner. Within four (4) months after our financial year-end, TTA organises an Annual General Meeting of Shareholders (“AGM”). The meeting is conducted in accordance with applicable laws and SET requirements,

CoRpoRATE GovERNANCE REpoRT

CoRPoRATE GovERNANCE REPoRT


from the calling of the meeting, the notification of the meeting agendas, the dispatch of meeting materials, the conduct of the meeting, and the distribution of minutes. For all other general meetings, except that above-mentioned, for urgent matters that affect or involve the shareholders’ interest or involve conditions, regulations, or laws that require the shareholders’ approval, Extraordinary General Meetings (“EGM”) shall be called on a case by case basis.

In addition, TTA publishes the notice of each meeting in at least one Thai language and one English language in a daily newspaper for three (3) consecutive days no later than three (3) days prior to each AGM. We also publish the meeting notice on our website.

In FY 2014, TTA held the Annual General Meeting of Shareholders (the “1/2014 AGM”) on 30 January 2014 at 1:30 P.M., at Grandhall, 2nd Floor, Imperial Queen’s Park Hotel, Klongton Sub-district, Klongtoey District, Bangkok, Thailand. No extraordinary meeting was held this financial year.

Procedures for the Shareholders’ meeting were as follows:

(i) Procedures prior to the meetings

In FY 2014, at the Board of Directors’ meeting held on 27 November 2013, it resolved to call the Company’s 1/2014 AGM on 30 January 2014 at 1:30 P.M., at Grandhall, 2nd Floor, Imperial Queen’s Park Hotel, Klongton Sub-district, Klongtoey District, Bangkok, Thailand.

The meeting venue is easily accessible through public transportation systems and convenient for shareholders to travel to the place of the meeting. The Company informed shareholders of the date, time, place, and meeting agendas together with the rationales or details of all Board resolu-tions on each agenda via SET’s ELCID on the following day after the Board resolved to call the shareholders’ meetings.

TTA uses the shareholders record date to ensure sufficient time to scrutinise meeting notices or request additional information ahead of the meeting. The notice and relevant documents to the 1/2014 AGM was sent to shareholders and the SET on 9 January 2014, which was at least fourteen (14) days prior to the meeting. Going forward, the Company will make best efforts to send all meeting notices to shareholders more than fourteen (14) days prior to the meeting as per the SET’s best practices. The notice was also made available on TTA’s website in advance so that shareholders have sufficient time to study the information to make their decisions. Each agenda included the opinion of the Board.

The Company encourages all shareholders including insti tutional investors to attend the Company’s shareholders’ meetings. Apart from direct mailings, the Company notified its shareholders via SET’s ELCID that the 1/2014 AGM’s meeting notice and relevant documents

were available to download on the Company’s website on 13 January 2014.

The Company also advertised the meeting notice in at least one Thai language and one English language in a daily newspaper for three (3) consecutive days prior to the shareholders’ meeting date. The notice of the 1/2014 AGM was advertised on 22-24 January 2014.

In addition, details such as time and place of the meeting, the meeting agendas with rationale and opinion of the Board on each agenda item in the notice of the annual general meeting, proxy forms, and a list of documents required for attending the meeting were distributed to shareholders in advance of meeting to assist them in exercising their rights and casting their votes on each agenda item.

(ii) At the shareholders’ meeting

In the shareholders’ meetings, TTA facilitated registration by separating lines between shareholders and proxy holders. TTA used a bar code system to register meeting attendees and to count votes. Envelopes were made readily available for shareholders to mail their proxy forms. The e-voting programme of the Thailand Securities Depository Co., Ltd. (“TSD”) was also used in the registration and vote count, increasing efficiency and transparency.

(iii) During the meeting

The Chairman of the Board of Directors presides over the meetings of shareholders. For shareholders’ convenience and clarification, multimedia presentations are shown during all meetings. TTA conducts the meeting in accordance with the agenda and offers an equal opportunity for each shareholder to cast their vote.

In the 1/2014 AGM meeting, legal advisors from HNP Counsellors Limited were engaged to act as independent inspectors to monitor the registration and the counting of votes, and the Chairman asked for two shareholders to bear witness to the vote counting, with two shareholders nominating themselves as witnesses, to ensure the meetings ware transparent and complied with applicable laws.

TTA was rated “Excellent” (scores ranging between 90-99) from the Corporate Governance Report of Thai Listed Companies for the quality of AGM arrangement since 2007. In 2014, TTA was rated Excellent, with a score for the quality of the AGM arrangement for the year 2014, held on 30 January 2014, of 96.125 points, an increase from that of 2013 of 91.88 points. The Company’s score was higher than the average score of all 528 listed companies participating. The assessment results were based on the assessment form conducted by the Thai Investors Association (“TIA”) in conjunction with the Securities and Exchange Commission (“SEC”) and the Listed Companies Association.



(iv) Procedures following the meeting

The Company submitted to the SET the resolutions of the shareholders’ meetings with details of voting results of each agenda through the SET’s ELCID and also posted the resolutions immediately in TTA’s website at http:// www.thoresen.com.

The Company prepared and submitted the minutes of the shareholders’ meetings in 2014 to the SET and the Business Development Department, Ministry of Commerce within the required time frame after the meeting. The minutes were also posted on our website.

2. Rights of Stakeholders

TTA acknowledges the importance of all stakeholder groups. Recogniz ing their contr ibut ion to our competitiveness and profitability, the Company takes into consideration the interests of both internal stakeholders, namely shareholders, employees, and management and external stakeholders such as creditors, suppliers, clients, communities, government agencies, and other related organisations. To safeguard their rights, TTA complies with all applicable laws and regulations and has established adequate internal controls and auditing systems to monitor compliance.

(A) ANTI-CORRUPTION EFFORTS

TTA conducts business with strong ethics and responsibility for all concerned parties. The Board has approved the Anti-Corruption Policy as a guideline for anti-corruption practices. In addition, practices of anti-corruption have been collated since 2010 and pub-lished to provide guidelines for anti-corruption. These practices are in line with the Company’s Anti-Corruption Policy.

The Company has provided clear guidelines in the Code of Business Conduct on receiving gifts and entertainment. No gift, favour, or entertainment should be accepted or given, if it obligates or might be perceived as an attempt to influence fair judgement.

No director, manager, employee, and their family members should accept or receive a gift or entertainment if it is (i) not consistent with customary business practices, (ii) extravagant in value, (iii) can be construed as a kickback, bribe, or payoff in violation of any laws, and (iv) violates any other laws or regulations.

The Company set up a Procurement Policy to protect fraud by outlining procurement procedures and authorities of purchasing officers and Purchasing Committee. Purchasing Committee and Acceptance Committee shall not be the same group of people.

The Company has also implemented the Whistle Blowing Policy to protect those who submit a report, grievance, or information regarding misconduct, or those who cooperate with the Company in providing information, under which they may choose not to disclose their identity if they deem that such disclosure may threaten safety or cause damage. The Company will keep all relevant information confidential, taking into account the safety of the whistleblowers. Under this policy, the Company protects employees who submit their grievances in good faith, in order to prevent retribution or retaliation. The Company will impose disciplinary action, including termination of employment, on any employee who makes or participates in such retribution or retaliation, in accordance with the Company’s Code of Business Conduct.

Any concern or information on violation of regulations or corruption may be submitted to the Audit Committee through the channels provided by the Company at http://www.thoresen.com, [email protected], or the mailing address below:

Thoresen Thai Agencies Plc.P.O. Box 12, SCB Post Office,Lumpini, Pathumwan, Bangkok 10330, Thailand

The Internal Audit opens the mailboxes twice a month. All letters will be forwarded to the Audit Committee (if any) for report to the Board at the quarterly meeting.

(B) SHAREHOLDERS

TTA always makes an effort to maximise shareholders’ long-term benefits through careful consideration of business risks. All information shall be disclosed fairly and transparently in a timely manner and use our best efforts to protect our assets and reputation.

Besides the basic rights of shareholders and the rights stipulated by law and the Company’s Articles of Association, such as the right to request a verification of the number of shares; the right to receive share certificates; the right to attend the shareholders’ meetings; the right to vote at the meetings; the right to freely express opinions at the shareholders’ meetings; and the right to receive a fair return; TTA also gives shareholders the right, as the owners of the Company, to make suggestions and comments on the Company’s affairs to the independent directors. Each comment and suggestion will be carefully considered and presented to the Board of Directors.

(C) EMPLOYEES

Employees are regarded as valuable assets of the Company. We continually seek to recruit and retain capable and experienced employees in accordance with our strategic and operating plans, focusing on retention of employees by creating a work-life balance for employees.



The Company pays appropriate remuneration to employees, competitive with other companies in the industry. It is the Company’s policy to pay remuneration to employees at the rate consistent with the Company’s short-term and long-term performance, taking into account the performance review of the employee and the operating results of the Company. Furthermore, the Company provides benefits to its permanent employees, including provident fund, insurance, personal health insurance, maternity leave, and annual leave. The Welfare Committee was established to provide consultation and advice regarding employee benefits. The main duties and responsibilities of the Welfare Committee include provision of advice regarding benefits, review and examination of benefits provided for employees, and additional or required opinions and suggestions regarding benefit provision.

With respect to occupational environment and health, TTA has determined a safety policy and established the Occupational Safety, Health, and Environment Committee to ensure good health and a good environment in the workplace, safe for the lives and properties of the employees and the Company. All employees shall notify the supervisor or persons assigned by the Company of any unsafe conditions. New employees are trained regarding safety at the orientation. This is to ensure that employees are aware of the potential hazards at the workplace, and understand how to conduct themselves in an event of danger.

We emphasise the importance of employees’ development at all levels by the implementation of Individual Development Plans that allow employees to create development plans concerning their individual needs. We encourage learning and the development of our personnel, and support and hold internal and external training, with courses appropriate to year of service, career path, and responsibility. In 2014, 22 courses were held, covering both technical skills and soft skills. The Company also held training on connected transactions for the Board, the management, and employees, so that they recognize the importance of connected transactions and notification thereof. We strongly believe that improvement of our employees’ capabilities will ultimately increase our competitiveness in the long run.

(D) COUNTERPARTIES

TTA conducts business affairs with our counterparties, including business partners, clients, competitors, creditors, suppliers, etc., according to the contracted terms and conditions, in a fair and ethical manner. Treatment of counterparties to create good understanding and cooperation shall be as follows:

Competitors: TTA treats competitors fairly, by operating its business with integrity and professionalism, as follows:

•TTA will not take any action that violates or breaches the law governing trade competition; and•TTA will implement an anti-corruption policy and prohibit its directors, executives, employees, or any other persons acting on behalf of the company from taking unlawful or inappropriate actions to secure business advantages.

Creditors: TTA is always committed to maintaining sustainable relationships with its creditors. It is TTA’s policy to treat our creditors equitably and fairly, by providing accurate, transparent, and traceable information for the creditors, and by strictly adhering to the terms and conditions made with creditors, in terms of payment of the principal, interest, and fees, maintenance of the financial ratio, and other conditions. If TTA fails to comply with any such condition, we will promptly notify the creditor, in order to mutually agree on a solution. During the last year, there was no payment default.

Business Partners: TTA sets criteria for choosing a busi-ness partner or service provider, to ensure that the business strategy of a potential service provider is consistent with that of the Company, in terms of competitiveness, business continuity, protection and treatment of clients, and risk management approaches. The criteria for choosing a service provider is as follows:

• Technical skills, including expertise and experience;• Financial position;• Business reputation;• History on complaints and legal actions;• Service policies;• Risks posed by provision of services to several clients;• Security and environment; and• Anti-corruption efforts.

In turn, the Company treats its service providers fairly.

(E) CLIENTS

TTA recognises that clients are crucial to the success of our operations. Accordingly, we ensure our clients’ satis-faction by offering high-quality services that meet their needs and expectations in a fair and professional manner. Our policy and practices on the treatment of clients as specified in the Code of Business Conduct are as follows:

•Deliver quality services and goods to the client’s satisfaction;•Provide accurate and complete information regarding the goods and services of the Company in a timely manner; •Strictly follow the terms and conditions agreed upon with the client;•Treat customers politely and effectively to gain their trust; and•Keep the client’s secrets confidential, and avoid using them to gain benefits for oneself or other persons.



(F) RESPONSIBILITY TO THE COMMUNITY, SOCIETY, AND ENVIRONMENT

TTA places emphasis on making the most effective use of natural resources with the least effect on the environment. TTA employed technology and developed work process that are environmentally-friendly, while raising awareness of employees regarding effects of their performance on the environment. The Company believes that to progress and grow in a sustainable manner, a business must develop its organization, taking into account responsibility to society and the environment. Details on our responsibility to the community, society, and environment can be found under the heading “Corporate Social Responsibility and Sustainability Development Policy”.

3. Information Disclosure and Transparency

TTA has strong determination to reveal timely and updated information, both financial and general information related to the Company’s business. Such information is disclosed to shareholders, investors, and any related parties via SET’s ELCID, the Company’s website (http://www.thoresen.com), press releases, the Company’s Annual Information Disclosure Form (Form 56-1), and the Company’s Annual Report. TTA actively participates in “Opportunity Days” arranged by SET on a quarterly basis.

Important information that is disclosed is as follows:

3.1 Corporate Governance Policy and implementation results

Through 2014, the Company complied with good corporate governance principles, except for the following matters:

(1) The Company did not clearly determine the term of an independent director, as there are a limited number of external expertise with knowledge of the Company’s core businesses. However, the Company reviews the qualifications of each independent director every year. The Company believes that each of its elected directors is a highly qualified individual who is respected for being knowledgeable, moral, and effective. If shareholders show confidence in a director by re-electing him or her, the Board will honour that decision. Therefore, the Company does not set a limit on consecutive terms of service by a director;

(2) The Company did not determine the number of companies each director and top-level executive can hold the directorships, as we are afraid it will cause us to lose the opportunity to appoint the right person as a director. However, the Company reviews the number of companies in which each director holds the directorship every year.

3.2 Remuneration of directors and executives

The remuneration of directors and executives is detailed under the heading “Management Structure” regarding remuneration of directors and executives.

3.3 Responsibilities of the Board for the financial statements

The Board is responsible for the accuracy of the Company’s financial statements, which must present sufficient financial information with accuracy and transparency, and must disclose sufficient important information in the notes to the financial statements, in accordance with the appropriate accounting standards to be consistently adhered to. The financial statements must be audited by an authorized auditor with independence and credibility, who must be certified by the SEC and/or relevant authority, and must have been verified by the Audit Committee. The remuneration for the auditor regarding the audit and other services shall be disclosed in the annual report. The Board has prepared a report on the responsibilities of the Board for the financial statements, and included the same in the annual report and the Company’s Annual Information Disclosure Form (Form 56-1). Furthermore, the Company held a meeting with analysts, held a press conference, and prepared a newsletter presenting the financial position of the Company.

3.4 Role and duties of the Board

The Company disclosed the name and profile of each di-rector, and the roles and duties of the Board, the Executive Committee, the Audit Committee, the Nomination and Remuneration Committee, the Risk Management Committee, and the Corporate Governance Committee, under the heading “Corporate Governance Report”, in order to inform the shareholders and relevant persons of the knowledge, skills, experience, and other important information regarding the directors who are behind the success of the Company’s business.

3.5 Relationship with investors

The Company established Corporate Communications and Investor Relations to communicate with investors, shareholders, analysts, relevant agencies, and the general public, in an appropriate and equitable manner.

In FY 2014, we met and provided information to interested parties on various occasions as follows:

1. One-on-one meetings with shareholders, creditors, and analysts (35 meetings)

2. Quarterly meetings with analysts and investors to discuss our most recent financial performance (2 meetings)



3. Investor conferences (8 conferences; 5 local and 3 international conferences)

4. Road shows (7 road shows; 2 local and 5 international road shows)

5. Quarterly presentation at the SET’s Opportunity Day (4 presentations)

6. Meeting with retail investors (6 meetings)

7. Disclosure of periodic reports, such as financial statements, quarterly financial results, reports on reviewed quarterly financial statements (F45-3), the Company’s Annual Information Disclosure Form (Form 56-1), and the Company’s annual report, (14 disclosures)

8. Disclosure of non-periodic reports, such as the notification of general meeting of shareholders and its resolutions, asset disposition and acquisitions, and investments (37 disclosures)

9. Press releases (16 releases)

10. Distribution of news and photo releases about the Company’s activities (7 releases)

11. Media relations activities (13 activities; 7 local and 6 international media interviews)

The management always participates in investor relations activities. To contact Investor Relations, please call +66 (0) 2254-8437 extension 292, fax +66 (0) 2655-5631, or email [email protected].

3.6 Whistle Blowing Policy and Whistleblower Protection Policy

The Company implements a Whistle Blowing Policy and Whistleblower Protection Policy as part of the Company’s Code of Business Conduct to ensure good corporate governance of the Company and equal rights of all employees and all stakeholders to directly communicate with the Audit Committee. In an employee has any concern, knowledge of violation or corruption or breach of the law, business ethics, or policies of the Company, grievance concerning violation of rights, opinion, complaint, or suggestion that may affect the good corporate governance or business ethics of the Company, they may contact us through the following channels:

•Website: http://www.thoresen.com•Email: [email protected]•Mail: P.O. Box 12, SCB Post Office, Lumpini, Pathumwan, Bangkok 10330

Information, grievances, and suggestions will be considered, and appropriate actions will be taken on a case-by-case basis, without disclosing the name of the

whistleblower or the content of the complaint. Measures are put in place to protect the whistleblower, to ensure that they will not be affected by the submission of informa-tion or a complaint.

3.7 Corporate Social ResponsibilityPolicy

Please see the heading “Corporate Social Responsibility and Sustainability Development Policy”.

4. Structure and Responsibilities of the Board of Directors

(A) BOARD STRUCTURE

The size of the TTA’s Board complies with Public Limited Companies Act B.E. 2535 and the Company’s Articles of Association.

All directors have a number of duties and responsibilities as specified in the Articles of Association. In conducting the Company’s business, a director shall perform his duty with responsibility, due care and loyalty, and shall comply with all laws, the objectives, the articles of association, and the resolutions of the shareholders’ meetings.

(i) Independent Director

An independent director is a director who does not manage TTA or any of its subsidiaries, is independent from management and major shareholders, and has no business dealings with TTA, which may compromise our interests and/or the shareholders’ interests.

The main qualifications of an independent director are as per the definition of the Notification of the Capital Market Supervisory Board. The definition of an independent director is also available on the Company’s website. Each independent director shall comply with the following rules:

1. Holding shares not exceeding one per cent of the total number of shares with voting rights of the Company, its subsidiary company, associate company, major shareholder or controlling person, including shares held by related persons of such independent director;

2. Neither being nor used to be an executive director, employee, staff, advisor who receives salary, or controlling person of the Company, its subsidiary company, associate company, same-level subsidiary company, major shareholder or controlling person, unless the foregoing status has ended not less than two years prior to the appointment. Such prohibited characteristic shall not include the case where the independent director used to be a government official or advisor of a government unit which is a major shareholder or controlling person of the Company;



3. Not being a person related by blood or legal registration as father, mother, spouse, sibling, and child, including spouse of child, executive, major shareholder, controlling person, or person to be nominated as executive or controlling person of the Company or its subsidiary company;

4. Neither having nor used to have a business relationship with the Company, its subsidiary company, associate company, major shareholder or controlling person, in the manner which may interfere with his independent judgement, and neither being nor used to be a significant shareholder or controlling person of any person having a business relationship with the Company, its subsidiary company, associate company, major shareholder or controlling person, unless the foregoing relationship has ended not less than two years prior to the appointment;

5. Neither being nor used to be an auditor of the Company, its subsidiary company, associate company, major shareholder or controlling person, and not being a significant shareholder, controlling person, or partner of an audit firm which employs auditors of the Company, its subsidiary company, associate company, major shareholder or controlling person, unless the foregoing relationship has ended not less than two years prior to the appointment;

6. Neither being nor used to be a provider of any professional services including those as legal advisor or financial advisor who receives service fees exceeding two million Baht per year from the Company, its subsidiary company, associate company, major shareholder or controlling person, and not being a significant shareholder, controlling person or partner of the provider of professional services, unless the foregoing relationship has ended not less than two years prior to the appointment;

7. Not being a director appointed as representative of directors of the Company, major shareholder or shareholder who is related to major shareholder;

8. Not undertaking any business in the same nature and in competition to the business of the Company or its subsidiary company or not being a significant partner in a partnership or being an executive director, employee, staff, advisor who receives salary or holding shares exceeding one per cent of the total number of shares with voting rights of other company which undertakes business in the same nature and in competition to the business of the Company or its subsidiary company; and

9. Not having any other characteristics which cause the inability to express independent opinions with regard to the Company’s business operations.

After being appointed as independent director with the qualifications under (1) to (9), the independent director may be assigned by the Board of Directors to take part in the business decision of the Company, its subsidiary company, associate company, same-level subsidiary company, major shareholder or controlling person, provided that such decision shall be in the form of collective decision.

(ii) Members of the Board of Directors

The Board consists of eleven (11) directors. However, one director resigned during the year and a new director has not been appointed to replace the director who resigned. As of 30 September 2014, there were ten directors, which consists of one (1) executive director (10% of the total number of directors), nine (9) non-executive directors (90% of the total number of directors), and four (4) independent directors (40% of the total number of directors). The Board as of 30 September 2014 consisted of the following persons:

Members of the Board of Directors as of 30 September 2014

Name Position First Appointment Date

1. Mr. Prasert Bunsumpun Chairman of the Board/Chairman of Executive Committee 31 Jan. 20122. Mr. Chalermchai Mahagitsiri President and Chief Executive Officer/Member of Executive

Committee/Member of Risk Management Committee31 Jan. 2012

3. Mr. Jean Paul Thevenin/1 Director/Member of Executive Committee 30 Jan. 20144. Mr. Chia Wan Huat Joseph Director/Member of Executive Committee/ Member of

Corporate Governance Committee31 Jan. 2012

5. Mr. Krish Follett Independent Director/Chairman of Audit Committee/Chairman of Risk Management Committee

12 Apr. 2012

6. Mr. Santi Bangor Independent Director/Chairman of Nomination and Remu-neration Committee/Chairman of Corporate Governance Committee/Member of Audit Committee

31 Jan. 2012

7. Ms. Ausana Mahagitsiri Director/Member of Nomination and Remuneration Committee/Member of Corporate Governance Committee

31 Jan. 2012

8. Mr. Mohammed Rashed Ahmad M. Al Nasseri

Independent Director/Member of Nomination and Remuneration Committee

30 Jan. 2013

9. Mr. Yves Barbieux Director 12 Jul. 201310. Mr. Cherdpong Siriwit Independent Director/Member of Audit Committee 30 Jan. 2013

Note : 1 Mr. Jean Paul Thevenin was appointed a Board member on 30 January 2014 in place of M.L. Chandchutha Chanaratat, the resigned director.



Authority and Duties of the Board

1) Review and approve the vision, mission, and Code of Business Conduct of the Company, and support and promote compliance of the Company’s management with the good corporate governance principles.

2) Review and approve the strategies, business plans, budgets, and policies, including annual business plan, investment budget, and operational objectives of the Company.

3) Appoint sub-committees and assigned authority and duties to each sub-committee to perform duties of the committees, as assigned by the Board.

4) Assign duties to the President and Chief Executive Officer concerning management of the Company in accordance with the policies, strategies, business plan, budget, and objectives of the Company.

5) Ensure that the management consistently perform their duties under the work plan in accordance with the organizational direction and strategies.

6) Review and approve human resources management strategies and human resources development plans, and determine an appropriate remuneration policy.

7) Ensure the Company has proper systems in place to communicate effectively with its stakeholders and the public and monitor their application.

8) Determine the guidelines for evaluating the Board and hold regular evaluation of the performance of the Board.

(iii) Segregation of Positions

The Board elects one of its non-executive directors as Chairman. The Chairman and President and Chief Executive Officer are two separate individuals. The Chairman oversees the implementation of policies and guidelines pursuant to the strategies established by the Board and management and ensures that Board meetings are successfully conducted. During each meeting, all directors are encouraged to actively participate and raise essential questions.

The authorities of the Board and management are clearly defined and segregated. At the same time, the Board stays away from routine tasks or business activities under management responsibility.

Duties and Responsibilities of the Chairman

1) Convene Board Meetings and assign the Company Secretary to arrange for delivery of notices of meetings and documents to ensure that the Board receives sufficient information in a timely manner.

2) Preside at the Board Meetings.

3) Preside at the Shareholders Meetings and ensure that the meetings are conducted in accordance with the Articles of Associations of the Company and the agenda specified.

4) Ensure efficient communication between the directors and the shareholders.

5) Perform duties specified by law as the duties of a chair-man.

Authority and Duties of the President and Chief Executive Officer

The President and Chief Executive Officer have the duties to manage the Company as assigned by the Board, and in accordance with the work plan or budget approved by the Board, in order to protect the best interests of the Company and its shareholders. The authority and duties of the President and Chief Executive Officer also cover other matters, namely:

1) Conduct necessary activities and manage daily tasks of the Company; and

2) Approve operating expenses and investment expenses in accordance with the budgets approved by the Board.

(iv) Directors’ Term of Service on Board

Duration of Each Term

Under the Articles of Association, at every Annual General Meeting of Shareholders, one-third of the Board, or if the number is not a multiple of three, the number nearest to one-third, shall retire from office. In choosing those directors who retire, length of service on the Board should be considered, so that those who have served the longest are most eligible to retire. The term of each director is approximately 3 years. A retiring director is eligible for re-election.

Number of Consecutive Terms of a Director is Permitted to Serve

The Company believes that each of its elected directors is a highly qualified individual who is respected for being knowledgeable, moral, and effective. If shareholders show confidence in a director by re-electing him or her, the Board will honour that decision. Therefore, the Company does not set a limit on consecutive terms of service by a director.

However, the Board of Directors will consider suitable solutions regarding consecutive terms of directors and independent directors in due course.



Nomination of Directors

The Board assigned the Nomination and Remuneration Committee to nominate persons with suitable qualifications as the Company’s directors. The Nomination and Remuneration Committee will consider the profile, age, knowledge, experience, potential, and other factors that may be required of a director of the Company.

Board Meetings

The Board schedules at least six Board Meetings per year in advance, and notifies each director. The Chairman is authorized to approve the meeting agenda. Each director is entitled to propose matters that are beneficial to the Company to be discussed in the meetings. The Company Secretary will deliver the notices of meetings, agenda, and supporting documents to the directors no later than seven days in advance, so that the directors have sufficient time to review the matters to be discussed. As per the Articles of Association of the Company the quorum of a Board Meeting requires no less than a majority of the total num-ber of directors on the Board.

In the financial year 2014 ended 30 September 2014, the Company held ten (10) Board Meetings and held unofficial ten (10) meetings of non-executive directors.

(B) COMPANY SECRETARY AND BOARD COMMITTEES

The Board has appointed the Company Secretary and five (5) committees, namely 1) Audit Committee, 2) Executive Committee, 3) Nomination and Remuneration Committee,

4) Corporate Governance Committee, and 5) Risk Management Committee.

(i) Company Secretary

The Board appointed Ms. Mantanee Surakarnkul as the Company Secretary on 14 August 2008 to take responsibility for matters connected with meetings of the Board and the shareholders and to contribute to best corporate governance practices. She also serves as the secretary of the Board and Corporate Governance Committee to coordinate subsequent actions under the Board’s resolutions.

The Company Secretary’s duties and responsibilities include:

1. To provide advice pertaining to the Company’s regula-tions and Articles of Association, to monitor new laws and regulations on a regular basis, and to report any significant changes to the Board;2. To arrange meetings of shareholders and the Board in accordance with applicable laws and regulations;3. To prepare minutes of shareholders and Board meetings and to monitor execution of such resolutions on a regular basis;4. To ensure that all public information disclosure is in accordance with laws and the SEC’s and SET’s regulations;5. To facilitate the Board’s activities, including director orientation; and6. To file and keep records of the Company’s key documents, such as directors’ registration, notice to the meetings, minutes of meetings, annual reports, notice to shareholders’ meetings, and reports on directors’ and management’s interest.

Details of the Company Secretary

Name% of Shareholdingas of 30 Sep. 2014 Educations Trainings/Certifications

Professional Experience

Ms. Mantanee Surakarnkul(Age 49)

Company Secretary (14 August 2008 – present)

0.000897% •Master of Business Administration (MBA), Sasin Graduate Institute of Business Administration of Chulalongkorn University

•Bachelor of Arts, Chulalongkorn University

•Company Secretary Program (CSP), Class 15/2006, IOD

•Effective Minute Taking (EMT), Class 2/2006, IOD

•Improving the Quality of Financial Reporting (QFR), Class 2/2006, IOD

•Understanding the fundamental of financial Statement (UFS), Class 1/2006, IOD

•Directors Certification Program (DCP), Class 1/2000, IOD

1990-present : Corporate Affairs Associate Director, TTA

Details of the Company Secretary’s functions are also available on the Company’s website and in the Company’s Annual Information Disclosure Form (Form 56-1). The Company encourages the Company Secretary to attend courses relating to company secretarial functions.



(ii) Audit Committee

The Audit Committee (“AC”) is comprised of at least three (3) independent directors. At the Board Meeting held on 14 August 2012, the Board reviewed and approved the revised Audit Committee Charter.

The AC has full-delegated authority from the Board to perform its tasks. An audit plan and meeting schedule are set each year to allow the AC to monitor financial information report procedures, the internal control and financial risk management system, and audit procedures, including the procedures for monitoring compliance with the law and regulations.

Members of the Audit Committee as of 30 September 2014

No. Name Position Appointment date

1 Mr. Krish Follett Chairman 12 Apr. 2012

2 Mr. Santi Bangor Member 14 Feb. 2012

3 Mr. Cherdpong Siriwit Member 14 Feb. 2013

All AC members are independent directors. During FY 2014, the AC convened twelve (12) meetings.

AC’s duties and responsibilities include:

1. Review the accuracy, sufficiency, credibility, and objectivity of the financial reporting process by coordinating with the external auditors and executives responsible for preparing the quarterly and yearly financial reports.

2. Review the appropriateness and effectiveness of internal control systems and internal audit functions by coordinating with the external auditors and internal auditors, ensure the adequacy of the internal control systems and internal audit functions as followings:

•Review the activities and organisational structure of the internal audit function and ensure no unjustified restrictions or limitations are made. •Determine an internal audit unit’s independence.•Consider and approve on the appointment, removal, transfer, or dismissal senior executives of Internal Audit.•Consider audit reports and recommendations presented by internal auditors and monitor the implementation of the recommendations.•Review the adequacy of the Company’s risk management and ensure that risk management complies with the guidelines of the relevant authorities and our internal policies.•Evaluate the performance of senior executives of Internal Audit with the President & CEO.•Approve audit plan, budget, number of staffs and staffs training plan of Internal Audit Department to ensure that the audit scope covers finance and operations and to monitor the performance as per the audit plan.

3. Review the Company’s business operations, ensure that they comply with the law on securities and exchange, the SEC’s regulations and the laws relating to the Company’s business.

4. Consider, select and nominate an independent person to be the Company’s auditor, including the negotiating auditing fee and the following main activities i.e.

•Review the performance of the external auditors by taking into account the auditor’s credibility, the adequacy of resources, audit engagements, and experience of its staff assigned to audit the Company’s accounts.•Review the external auditors’ proposed audit scope and approach and ensure no unjustified and restrictions or limitations have been placed on the scope.•Make recommendations to the Board regarding the reappointment of the external auditors.•Consider audit reports and recommendations presented by the external auditors and monitor the implementation of the recommendations.•During the year, the Audit Committee meets with the external auditors and the Head of Internal Audit separately without any management in attendance at least once a year.

5. Consider the Company’s business operations including the connected transactions and ensure that there is no conflict of interest, taking into consideration transactions between the Company’s and subsidiaries or related parties in order to assure the effectiveness of the system for monitoring compliance with laws and regulations and to be reasonable for the highest benefit of the Company.

6. Prepare and disclose in the Company’s annual report, an Audit Committee’s report which must be signed by the Audit Committee’s chairman and consist of at least the following information.

•An opinion on the accuracy, completeness and creditability of the Company’s financial report,•An opinion on the adequacy of the Company’s internal control system,•An opinion on the compliance with the law on securities and exchange, the SEC’s regulations, or the laws relating to the Company’s business,



•An opinion on the suitability of an auditor. The Company has a policy to safeguard the independence of the external auditors by limiting non-audit services to define audit related and tax services. The selection of the external auditor shall be reviewed every 3-5 years,•An opinion on the transactions that may lead to conflicts of interests,•The number of the Audit Committee meetings, and the attendance of such meetings by each committee member,•An opinion or overview comment received by the Audit Committee from its performance of duties in accordance with the charter, and •Other transactions which, according to the Audit Committee’s opinion, should be known to the shareholders and general investors, subject to the scope of duties and responsibilities assigned by the Board.

7. Perform any other act as assigned by the Board, with the approval of the Audit Committee.

8. Report Audit Committee’s activities at every Board’s quarterly meeting.

9. Review the summary and evidence of fraud of employees or executives which result in the damage to the Company and propose the reviewed report by the Audit Committee to the Board for consideration.

10. Review Audit Committee’s performance on annual basis.

11. Review and reassess the adequacy of this Charter periodically and recommend any proposed changes to the Board for approval.

Appointment of the Auditors and Fixing the Auditing Fee

The Board assigned the AC to consider and propose the appointment of the external auditors and the auditing fee to shareholders for approval at every AGM. At the 2014 AGM, the shareholders approved the following items:

1. The appointment of Mr. Veerachai Ratanajratkul, CPA No. 4323, Mrs. Siripen Sukcharoenyingyong, CPA No. 3636, Mr. Charoen Phosamritlert, CPA No. 4068, or Ms. Pornthip Rimdusit, CPA No. 5565, of KPMG Phoomchai Audit Ltd. as auditors for the 2014 financial year.

2. The audit fee in the amount of Baht 4.65 million to review and audit TTA’s financial statements and consolidated financial statements.

The AC advised the Board of its assessment and recommendation for the appointment of the external auditors and the auditing fee.

The AC has proposed to appoint KPMG Phoomchai Audit Ltd. as external auditors of the Company to our shareholders at the next AGM to be held on 28 January 2015.

(iii) Executive Committee

At the Board Meeting held on 14 February 2012, the Board approved the appointment of the Executive Committee (“EC”) and on 15 March 2012, the Board approved the Executive Committee Charter.

The Executive Committee (the “EC”) comprises a minimum of four (4) members from the Company’s directors and executives.

Members of the Executive Committee as of 30 September 2014


1 Mr. Prasert Bunsumpun Chairman 12 Feb. 2012

2 Mr. Chalermchai Mahagitsiri Member 12 Feb. 2012

3 Mr. Jean Paul Thevenin Member 12 Feb. 2014

4 Mr. Chia Wan Huat Joseph Member 12 Feb. 2012

During FY 2014, the EC convened twelve (12) meetings.

The EC’s main tasks include considering the Company’s business plans and annual budget for presentation to the Board, considering overall investment and financing strategies, and approve transactions within its delegated authorities.

(iv) Nomination and Remuneration Committee

The Nomination and Remuneration Committee (“NRC”) comprises at least three (3) non-executive directors. At the Board Meeting held on 13 May 2011, the Board approved the Nomination and Remuneration Committee Charter.



Members of the Nomination and Remuneration Committee as of 30 September 2014


1 Mr. Santi Bangor Chairman 14 Feb. 2013

2 Ms. Ausana Mahagitsiri Member 14 Feb. 2012

3 Mr. Mohammed Rashed Ahmad M. Al Nasseri Member 14 Feb. 2013

During FY 2014, the NRC convened four (4) meetings.

The NRC’s main tasks include the determination of the process and criteria for the selection and qualification of candidates nominated in accordance with the Board’s recommended structure, size, and composition. It reviews and opines on all candidates nominated (whether by the Board, shareholders, or otherwise) for appointment to the Board.

The NRC is authorised by the Board to assess the performance of top executives, including the President and Chief Executive Officer and Executive Vice Presidents on an annual basis in order to determine their remuneration before proposing to the Board for approval.

The NRC will also consider the remuneration of non- executive directors and propose it to the Board to recommend to the Company’s shareholders for approval.

The Board sets the level of remuneration for all non-exec-utive directors within the limits approved by shareholders and in line with the Thai Institute of Directors Association guidelines regarding Director Compensation Best Practices (September 2006).

(v) Corporate Governance Committee

At the Board Meeting held on 28 November 2011, the Board approved the appointment of the Corporate Governance Committee (“CGC”) and on 21 December 2011, the Board approved the Corporate Governance Charter. The Corporate Governance Committee (the “CGC”) comprises a minimum of three (3) non-executive directors.

Members of the Corporate Governance Committee as of 30 September 2014


1 Mr. Santi Bangor Chairman 14 Feb 2012

2 Ms. Ausana Mahagitsiri Member 14 Feb 2012

3 Mr. Chia Wan Huat Joseph Member 14 Feb 2012

The CGC’s main tasks include reviewing the Corporate Governance Policy and the Code of Business Conduct and to monitor compliance, so that TTA operates within an ethical framework and to monitor ongoing improvements.

In 2012, the CGC reviewed the Corporate Governance Policy and evaluated Board performance through a self assessment process.

In 2013 and 2014, the CGC proposed to the Board that policies be made in writing, and that existing policies be improved, including the Authorization Policy, Risk Management Policy, Internal Audit Policy, Procurement

Policy, Anti-Corruption Policy, Insider Trading Policy, Information Technology Policy, Travel Entertainment and Expenses Policy, and policies regarding human re-sources management.

(vi) Risk Management Committee

At the Board Meeting held on 14 May 2010, the Board approved the appointment of the Risk Management Com-mittee (“RMC”) and on 14 December 2010, the Board approved the Risk Management Committee Charter. The RMC members comprise a minimum of four (4) members from the Company’s directors and executives.

Members of the Risk Management Committee as of 30 September 2014


1 Mr. Krish Follett Chairman 19 Sep. 2012

2 Mr. Chalermchai Mahagitsiri Member/President and Chief Executive Officer 19 Sep. 2012

3 Mr. Krailuck Asawachatroj Member/Executive Vice President, Corporate Finance and Accounting

27 Nov 2013

4 Mr. Somporn Chitphentom Member/Executive Vice President, Corporate Strategy 27 Nov 2013



There were four (4) RMC meetings in FY 2014.

The RMC’s main tasks include reviewing the effectiveness of the enterprise risk management system and be assured that material risks are identified and appropriate risk man-agement processes are in place, including the formulation and subsequent updating of appropriate group wide poli-cies.

Besides, the Company held risk management workshops and training for each business. The training also focused on concepts and principles of practicing on risk manage-ment throughout the organization which would contribute ensuring the sustainable growth of the Company as well as create long-term value for stakeholders and sharehold-ers. The risk management criteria’s have been adapted as key factors in performance evaluation of staffs.

(C) CONFLICT OF INTEREST

(i) Potential Conflict of Interest Transactions and Inter-Company Transactions

Since 2009, directors and executives have been required to submit a report that summarises their related persons’ interests and securities ownership in other companies. This information is filed with TTA and used to monitor potential related party or connected transactions. New TTA directors and senior executives shall submit this report within thirty (30) days after being appointed.

In case there are changes in related persons and close relatives, directors and executives shall submit a revised report to TTA within fourteen (14) days after changes occur.

Directors, executives, and employees must refrain from any transactions that may lead to a conflict of interest with TTA. Any interested directors, executives, and employees are not allowed to participate in the decision-making process. In particular, directors are prohibited from considering or casting their votes on matters in which they may have a potential conflict of interest.

(ii) Monitoring Insider Trading

The Board prohibits directors, executives, and employees from using an opportunity or information acquired while working in their positions to seek personal benefit or to establish a competing or related business with TTA. This includes a complete prohibition against using material insider information to buy or sell TTA’s shares and securities for their own interest and against giving insider information to other persons or entities to buy or sell TTA’s shares and securities.

The Company requires that directors and executives report trading transactions in TTA’s shares and securities, and their ownership position, whenever changes occur. The directors and executives shall notify the Company of their trading transactions on the same day on which the report is submitted to the Office of the Securities and Exchange Commission. The Company prohibits all directors and senior executives from trading TTA’s shares and securities during the period of three (3) weeks before the release of our quarterly and annual financial results (the “Blackout Period”). This prohibition applies to entities in which our directors have a beneficial interest, are employed by, or act as a representative thereof. The Company Secretary will remind directors and executives about this restriction at least (seven) 7 days in advance of the Blackout Period.

(D) BOARD MEETINGS

Board meetings shall be held once at least every three (3) months specified in the Company’s Articles of Association. Special meetings are convened as necessary to address specific needs. In FY 2014, there were ten (10) Board meetings. Principal meeting agendas were: consideration of TTA’s strategic direction, annual business plan and budget, quarterly financial reports, and significant acquisition and disposal of assets.

The Board requires all members to devote sufficient time to the work of the Board, to perform the duties and responsibilities of Directors, and to use their best endeavours to attend meetings. All directors are encouraged to attend at least 75% of all Board meetings held during the year.



Attendance Record of the Board and Committees for the 2014 Financial Year

Name

Meeting Attendance in FY 2014

Appointment during the year

Board of Directors(Total 10)

Audit Committee(Total 12)

Executive Committee(Total 12)


Committee(Total 4)


(Total 1)


(Total 4)

1. Mr. Prasert Bunsumpun

10/10 - 12/12 - - - -

2. Mr. Chalermchai Mahagitsiri

10/10 - 10/12 - - 1/4 -

3. Mr. Jean Paul Thevenin

5/5 - 9/9 - - - Board memberon 30 Jan 2014

(in place ofM.L. Chandchutha

Chandratat)- EC member on

12 February 2014(in place of

M.L. Chandchutha Chandratat)

4. Mr. Chia Wan Huat Joseph

10/10 - 12/12 - 1/1 - -

5. Mr. Krish Follett 10/10 12/12 - - - 4/4 -

6. Mr. Santi Bangor 10/10 12/12 - 4/4 1/1 - -

7. Ms. Ausana Mahagitsiri

7/10 - - 4/4 0/1 - -

8. Mr. Mohammed Rashed Ahmad M.Al Nasseri

6/10 - - 3/4 - - -

9. Mr. Yves Barbieux

6/10 - - - - - -

10. Mr. Cherdpong Siriwit

7/10 11/12 - - - - - RMC member on 26 November 2014

Attendance Record of Resigned Directors for the 2014 Financial Year

Name

Meeting Attendance in FY 2014

Appointment during the year

Board of Directors(Total 10)

Audit Committee(Total 12)

Executive Committee(Total 12)


Committee(Total 4)


(Total 1)


(Total 4)

1. M.L. Chandchutha

Chandratat

4/4 - 0/3 - - 0/1 resigned from

the Board on

30 January 2014

2. Mr. Ghanim Saad

M. Alsaad

Al-Kuwari

0/5 - - - - - resigned from the

Board on 9 May 2014

Note: A total of 10 Board meetings took place during the year: 5 regular meetings and 5 special meetings.

* Directors could not attend the meeting due to missions abroad or other missions. Each director has submitted a letter of absence from the meeting to the Chairman or notified the Chairman before the meeting.



(E) BOARD ASSESSMENT

The Board conducted a formal evaluation of its own per-formance for the year that ended on 30 September 2014. The evaluation process was led by the Chairman of the CGC and was conducted by sending a board assessment form to each Director. The responses to the form were collated by the Company Secretary and the Chairman of the CGC reported the result to the Board of Directors.

There were six (6) main areas of evaluation namely:

1. Structure and Characteristics of the Board2. Roles and Responsibilities of the Board3. Board Meetings4. Board of Directors’ Performance of Duties5. Relationship with Management6. Self-development of Directors

In 2014, the assessment results as a whole were ‘Very Good’. The Board discussed the results and possible improvements and asked different committees to propose measures to improve the efficiency of the Board.

(F) DIRECTOR ORIENTATION AND DEVELOPMENT

The Company prepares a handbook for directors, which includes a summary of the Company’s information, policies, charters, and structure and distributes it to all directors as

basic information. The Company established a Director Induction Program for new Board members to facilitate their prompt performance of duties. The President and Chief Executive Officer normally gives orientation meetings for new Board members. In these meetings, briefings on the Company’s policies and key business operations are given. Moreover, new Board members will also meet with different executives to understand the business units in greater detail.

In addition, the Company encourages directors to attend courses or join activities aimed at improving their performance on the Board and Board committees. Currently, eight (8) of the total ten (10) directors participated in the Thai Institute of Directors’ (“IOD”) director training programmes, including the Role of Chairman Program (“RCP”), the Director Accreditation Program (“DAP”), the Director Certification Program (“DCP”), the Finance for Non-Finance Director Program (“FND”), the Role of the Compensation Committee Program (“RCC”), the Audit Committee Program (“ACP”), 4M; Monitoring Fraud Risk Management (“MFM”), Monitoring the System of Internal Control and Risk Management (“MIR”), Monitoring the Internal Audit Function (“MIA”), Monitoring the Quality of Financial Reporting (“MFR”), and Diploma Examination (EMAM)

TTA encourages directors who have not participated in the above training programmes to participate at the Company’s expense.

Summary of IOD courses which TTA’s directors attended

Name

Role of Chairman Program

(RCP)

Director Accreditation

Program(DAP)

Director Certification

Program(DCP)

Finance for Non-Finance

Director Program

(FND)

Role of the Compensation

Committee Program

(RCC)

Audit Committee Program

(ACP)

Diploma Examination

(EXAM) 4M

1. Mr. Prasert Bunsumpun

RCP 28/2012

DAP 26/2004

2. Mr. Chalermchai Mahagitsiri

DAP 30/2004

DCP 53/2005

3. Mr. Jean Paul Thevenin

DAP 74/2008

4. Mr. Chia Wan Huat Joseph

DCP 165/2012

5. Mr. Krish Follett DCP 149/2011

EXAM 32/2012

6. Mr. Santi Bangor DCP 12/2001

RCC 16/2013

ACP 42/2013

MFM 9/2013MIR 14/2013MIA 14/2013MFR 17/2013

7. Ms. Ausana Mahagitsiri

DAP 30/2014

8. Mr. Cherdpong Siriwit

RCP 10/2004

DAP 8/2004

DCP 104/2008

FND13/2004

ACP 27/2009



5. Business Ethics and Code of Conduct

(A) TTA’S ETHICAL AND OPERATIONAL GUIDELINES

TTA has the following ethical and operational guidelines:

(i) Fairness

We believe in being fair to all parties having a business relationship with us and conscientiously avoid favouritism or a conflict of interest situation.

(ii) Professionalism

We carry out our responsibilities in a professional manner and are determined to achieve excellence by continuously increasing performance levels through new methods and technologies.

(iii) Proactiveness

We are responsive to client needs and social, technical, and economic changes and adapt to the circumstances.

(iv) Discipline and Compliance

We pursue business affairs with discipline and ethical principles and ensure that our undertakings comply with laws, rules, and regulations.

(B) CODE OF BUSINESS CONDUCT

The Board has approved a Core Values, Mission and Vision (“VMV”) framework to guide business operations. A Code of Business Conduct was approved by the Board on 12 February 2010 to implement the VMV framework, emphasising our four Core Values.

TTA has arranged Code of Business Conduct training to all employees to ensure that they understand good practices and has included the Code of Business Conduct training as part of the orientation for new employees.

The four Core Values are:

(i) Integrity: We are open, honest, and ethical, deliver on our promises, and build and nurture trust in our relationships.

(ii) Excellence: We set high standards of quality, safety, environment, security, and service, are always prepared for challenges, and conduct our business professionally.

(iii) Team Spirit: We care for our clients, employees, and suppliers and behave in ways that build a spirit of teamwork and collaboration and show deep respect for one another.

(iv) Commitment: We are passionate about the future of this Company and feel accountable for business results and success.



INTERNAl CoNTRol ANd RISK MANAGEMENT

TTA is committed to operating within a strong system of internal control that enables business to be transacted and manages risk without exposing itself to unacceptable potential losses or reputational damage. TTA establishes the mechanisms and processes by which the Board of Directors (“the Board”) directs the organization, through setting the tone and expectations from the top, delegating its authority and monitoring compliance.

The Board has responsibility for ensuring that management maintains an effectiveness system of risk management and internal control and for reviewing its effectiveness. It has delegated authority to the Audit Committee (“the AC”) to assist it in fulfilling its responsibilities especially in relation to internal control, financial reporting and compliance with relevant laws and regulations.

The Internal Audit Department (“IAD”) is an independent department that reports directly to the AC. The IAD assists the AC and the Board by performing regular assessments and evaluations on TTA’s key controls for both design and operating effectiveness. Issues arising out of business risk and control assessments and other internal and external sources are considered to identify pervasive themes, where appropriate, significant issues are reported to AC and the Board. The AC monitors resolution of any identified control issues through to a satisfactory conclusion. In addition, regular reports are made to the AC and the Board by management, internal audit and compliance functions covering in particular financial, operational controls and compliance.

TTA’s internal control procedure is based on the regulations of The Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), consisting of five components as follows:

1. Organizational Control Environment

TTA encourages and promotes a good working environment by setting policy and planning, executing, controlling and monitoring all business activities. TTA has also established a suitable organizational structure, according to business size and operations and adheres to its business philosophies and ethics. TTA expects all management to be honest and ethical and act as role

models for all employees. All stakeholders are treated with fairness and respect and in such a way that adheres to good corporate governance principles.

Employee authority and responsibility are also clearly determined at each level. The fundamental values described in the Code of Conduct apply to every employee. The Code of conduct creates a climate rooted in focus on the customer, achievement, mutual respect, teamwork and trust. In addition, business goals have been formulated for employees to follow and have been closely monitored. Moreover, TTA defines all job descriptions, job specification and assigned suitable authorities and responsibilities. TTA recognizes that a proper control environment will lead to work efficiency and effectiveness of work.

2. Risk Assessment

TTA’s management has reviewed its risk policy, frameworks, and plans. The management and all employees have also been encouraged to be aware of the importance of risk and the significance of risk management so that everyone is prepared to mitigate or resolve the identified risk appropriately in a timely fashion. TTA is promoting a risk awareness culture, in which risk management is everyone’s responsibility. A risk management structure has been systematically created. Risk management plans and measures have been formulated where both internal and external risk factors possibly affecting TTA’s businesses and targets as well as operations are assessed. The risk assessment also results in control targets for how risks are to be managed through various control structures. In addition, TTA has formulated its reporting and risk management monitoring procedures for appropriate responses to constant changes. Risk management monitoring plans are carefully reviewed before being reported to the Board. The Board appointed the Risk Management Committee who charged with the review of the risk management policy framework and structure, and with the provision of recommendations on risk management that agree with strategic business directions and business plan, while supervising, monitoring and reviewing key outcomes of risk management reporting to ensure their alignment with standards and prevailing circumstances.



3. Control Activities

TTA focuses on efficient control activities that are in line with acceptable risks and appropriate for the business circumstances and activities of each department. These control activities are implemented through regulation, policy and working procedures. They are also reviewed and improved continuously. The transactions amongst the Company and its related parties have been carefully controlled by upholding its best interests as if the Company were dealing with outside parties on the arm’s length basis and conform to the Securities and Exchange Commission and the Stock Exchange of Thailand regulations requirements, other regulatory bodies and are reasonable and for the highest benefit of the Company so as to prevent the conflict of interest. Moreover, TTA encourages its employees to recognize the important of strictly complying with the control activities as well as related laws and regulations. This is to reduce risks covering various aspects, especially fraud risk and preventing violation of the laws.

4. Information and Communication

Information technology has been developed to ensure efficient business operations and to serve management’s needs. TTA recognizes the importance of accuracy, reliability, and prompt information and communication. The primary objective is the provision of accurate and timely data for decision-making. TTA has valued the information and communication system and also instituted systematic data processing processes with access and application controls. It also has an effective information security system, including a contingency plan to protect the information system when there are serious incidents that may cause system failure. Furthermore, TTA deploys an audit trail system that can track back and review historical data. TTA also maintains an information system to analyze data and indicate any risk area, for which comprehensive records and reports are available. Moreover, an internal control system for the financial and accounting functions is clearly set up, which allows adequate reporting to the relevant management. Besides, TTA has complied the Computer Offense Act and computer traffic data as requires by the Ministry of Information and Communications Technology. TTA also has invested in an effective communication system, including internal and external channels. The internal communication manages through various channels such as quarterly town hall meeting, the Company’s intranet and email. The accounting records conform to Thai Financial Reporting Standards and the accounting files are updated regularly. Documents for the shareholders’ meetings and the Board’s meetings have been delivered ahead of the meetings and contain sufficient information for the shareholders or the Board to make decisions.

5. Monitoring

Since the existing systems provide prompt and reliable information on a regular basis, management and the Board can therefore achieve proper monitoring over relevant financial reports in an effective manner and support the business objective and goal achievement. At the same time, they can also perform an accurate review and assessment, and suggest improvement over existing business plans, supported by effective internal supervision carried out by the IAD throughout the year.

The internal audit works according to an annual audit plan that is approved and monitored by the AC. The plan is based on the risk analysis and encompasses prioritized companies, business areas and processes. The results of the performed audits and following up observations are reported to AC and the Board. No significant control deficiencies have been reported to date. However, recommendations regarding internal controls have been provided in some areas. The IAD also reviews whether key operations and financial activities are conducted efficiently and legally.

The Board formally reviews the effectiveness of the system of internal control annually. Processes are in place for identifying, evaluating and managing the significant risks facing the Company in accordance with the Internal Control Assessments Guidance published by the Securities and Exchange Commission (“SEC”).

At Board Meeting No. 13/2014, held on 22 December 2014 with the Audit Committee present, the Board assessed the five components above of the Company’s internal control systems. The Board concluded that the Company’s internal control systems were found to be adequate and effective, with no material deficiency.

KPMG Phoomchai Audit Ltd., the Company’s external auditors, who concluded the audit of the 2014 financial statements, concluded that there was no material deficiency in the Company’s accounting and financial control system.



RE

lATE

d p

AR

Ty T

RA

NS

AC

TIo

NS

Rel

ated

par

ty tr

ansa

ctio

ns b

etw

een

TT

A a

nd it

s su

bsid

iarie

s or

bet

wee

n su

bsid

iarie

s an

d su

bsid

iarie

s ar

e sh

own

in th

e no

tes

to th

e co

nsol

idat

ed fi

nanc

ial s

tate

men

ts.

Maj

or r

elat

ed

part

y tr

ansa

ctio

ns b

etw

een

TT

A a

nd it

s su

bsid

iarie

s w

ith a

ssoc

iate

s or

join

t ve

ntur

es o

r a

tran

sact

ion

with

a c

ompa

ny o

r pe

rson

s th

at m

ay h

ave

conf

licts

of

inte

rest

are

sho

wn

as

follo

ws:

Co

mp

anie

sR

elat

ed P

arty

Co

mp

anie

s/E

nti

ties

Rel

atio

nsh

ipD

escr

ipti

on

of

Tra

nsa

ctio

ns

Tra

nsa

ctio

nA

mo

un

t (B

aht)

Pri

cin

g P

olic

y30

Sep

t 20

1430

Sep

t 20

13

1. B

acon

co C

o., L

td.

Tho

rese

n (I

ndoc

hina

) S

.A.

TT

A h

olds

a 1

00%

sta

ke in

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. a

nd

Sol

eado

Hol

ding

s P

te. L

td.

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. h

olds

a

100%

sta

ke in

Bac

onco

Co.

, Ltd

.

(201

3: S

olea

do h

olds

a 1

00%

sta

ke in

Bac

onco

Co.

, Ltd

.).

TT

A a

lso

hold

s a

50%

sta

ke in

Tho

rese

n (I

ndoc

hina

) S

.A.

Bot

h co

mpa

nies

are

indi

rect

ly h

eld

by

TT

A.

Bac

onco

rec

eive

d sh

ippi

ng a

genc

y

serv

ices

from

Tho

rese

n (I

ndoc

hina

)

S.A

.

88,4

79,2

98

(Rec

orde

d as

tran

spor

tatio

n

expe

nses

)

24,2

97,7

94

(Rec

orde

d as

tran

spor

tatio

n

expe

nses

)

Sam

e pr

ice

as T

hore

sen

(Ind

ochi

na)

S.A

. nor

mal

ly

char

ged

to o

ther

clie

nts

2. B

acon

co C

o., L

td.

Tho

rese

n-V

inam

a

Age

ncie

s C

o., L

td.

TT

A h

olds

a 1

00%

sta

ke in

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. a

nd

Sol

eado

Hol

ding

s P

te. L

td.

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. h

olds

a 10

0% s

take

in B

acon

co C

o., L

td.

(201

3: S

olea

do h

olds

a 1

00%

sta

ke in

Bac

onco

Co.

, Ltd

.).

TT

A a

lso

hold

s a

50%

sta

ke in

Tho

rese

n (I

ndoc

hina

) S

.A. a

nd T

hore

sen

(Ind

ochi

na)

S.A

. hol

ds a

49%

sta

ke in

Tho

rese

n-V

inam

a A

genc

ies

Co.

, Ltd

.

Bot

h co

mpa

nies

are

indi

rect

ly h

eld

by T

TA

.

Bac

onco

Co.

, Ltd

. ren

t out

fact

ory

area

to T

hore

sen

- V

inam

a A

genc

ies

Co.

, Ltd

.

29,2

84,2

32

(Rec

orde

d as

rent

al in

com

e)

17,2

93,4

28

(Rec

orde

d as

rent

al in

com

e)

In li

ne w

ith m

arke

t

Bac

onco

rec

eive

d sh

ippi

ng a

genc

y

serv

ices

from

Tho

rese

n -

Vin

ama

Age

ncie

s C

o., L

td.

44,8

03,6

12

(Rec

orde

d as

tran

spor

tatio

n

expe

nses

)

32,8

77,4

71

(Rec

orde

d as

tran

spor

tatio

n

expe

nses

)

In li

ne w

ith m

arke

t

RElATEd PARTy TRANSACTIoNS


Co

mp

anie

sR

elat

ed P

arty

Co

mp

anie

s/E

nti

ties

Rel

atio

nsh

ipD

escr

ipti

on

of

Tra

nsa

ctio

ns

Tra

nsa

ctio

nA

mo

un

t (B

aht)

Pri

cin

g P

olic

y30

Sep

t 20

1430

Sep

t 20

13

3. B

acon

co C

o., L

td.

Tho

rese

n -

Vin

ama

Age

ncie

s C

o., L

td.

TT

A h

olds

a 1

00%

sta

ke in

PM

Tho

rese

n

Asi

a H

oldi

ngs

Plc

. and

Sol

eado

Hol

ding

s

Pte

. Ltd

.

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. h

olds

a

100%

sta

ke in

Bac

onco

Co.

, Lt

d. (

2013

:

Sol

eado

hol

ds a

100

% s

take

in B

acon

co

Co.

, Ltd

.).

TT

A a

lso

hold

s a

50%

sta

ke in

Tho

rese

n

(Ind

ochi

na)

S.A

. an

d ho

lds

a 49

% s

take

in T

hore

sen-

Vin

ama

Age

ncie

s C

o.,

Ltd.

and

Tho

rese

n-V

inam

a A

genc

ies

Co.

, Ltd

.

also

hol

ds a

100

% s

take

in

Tho

rese

n-

Vin

ama

Logi

stic

s C

o., L

td.

Bo

th c

om

pa

nie

s a

re i

nd

ire

ctly

he

ld b

y

TT

A.

Bac

onco

rece

ived

log

istic

ser

vice

s fr

om

Tho

rese

n-V

inam

a A

genc

ies

Co.

, Ltd

.

27,9

31,5

30

(Rec

ord

as

tran

spor

tatio

n

expe

nses

)

18,9

71,7

45

(Rec

ord

as

tran

spor

tatio

n

expe

nses

)

In li

ne w

ith m

arke

t

4. B

acon

co C

o., L

td.

Bar

ia S

erec

eT

TA

hol

ds a

100

% s

take

in P

M T

hore

sen

Asi

a H

oldi

ngs

Plc

. and

Sol

eado

Hol

ding

s

Pte

. Ltd

.

PM

Tho

rese

n A

sia

Hol

ding

s P

lc. h

olds

a

100%

sta

ke in

Bac

onco

Co.

, Lt

d. (

2013

:

Sol

eado

hol

ds a

100

% s

take

in B

acon

co

Co.

, Ltd

.)

Sol

eado

Hol

ding

s P

te.

Ltd.

als

o ho

lds

a

20%

sta

ke in

Bar

ia S

erec

e.

Bo

th c

om

pa

nie

s a

re i

nd

ire

ctly

he

ld b

y

TT

A.

Bac

onco

rec

eive

d po

rt o

pera

tion

ser-

vice

s fr

om B

aria

Ser

ece.

21,9

01,5

15

(Rec

ord

as

tran

spor

tatio

n

expe

nses

)

19,1

04,6

17

(Rec

ord

as

tran

spor

tatio

n

expe

nses

)

In li

ne w

ith m

arke

t

Ba

con

co h

ad

ge

ne

ral

ad

min

istr

ativ

e

expe

nses

with

Bar

ia S

erec

e.

6,33

2,59

8

(Rec

ord

as

adm

inis

trat

ive

expe

nses

)

5,58

4,77

2

(Rec

ord

as

adm

inis

trat

ive

expe

nses

)

Act

ual c

ost



Co

mp

anie

sR

elat

ed P

arty

Co

mp

anie

s/E

nti

ties

Rel

atio

nsh

ipD

escr

ipti

on

of

Tra

nsa

ctio

ns

Tra

nsa

ctio

nA

mo

un

t (B

aht)

Pri

cin

g P

olic

y30

Sep

t 20

1430

Sep

t 20

13

5. S

ubte

ch L

td.

Za

mil

Me

rma

id O

ffsh

ore

Ser

vice

s C

ompa

ny (

LLC

).

TT

A h

olds

a 5

7.42

% (2

013:

57.

14%

) sta

ke

in M

erm

aid

Ma

ritim

e P

lc.

an

d h

old

s a

100%

sta

ke i

n S

ubte

ch L

td.

and

a 40

%

stak

e in

Zam

il O

ffsho

re S

ervi

ces

Com

pany

LLC

.

Zam

il M

erm

aid

Offs

hore

Ser

vice

s

Com

pany

LLC

. en

gage

d S

ubte

ch L

td.

for

offs

hore

ser

vice

s to

Sau

di A

ram

co.

2,70

1,00

4,01

0

(Rec

orde

d as

serv

ice

inco

me)

1,54

0,00

0,13

7

(Rec

orde

d as

serv

ice

inco

me)

Pric

e ag

reed

bet

wee

n

Sub

tech

Ltd

. and

Zam

il

Mer

mai

d O

ffsho

re

Ser

vice

s C

ompa

ny w

hich

is n

orm

al p

rice

char

ged

to a

third

par

ty

6. M

erm

aid

Mar

itim

e P

lc.

Gul

f Age

ncy

Com

pany

(Tha

iland

) Lt

d.

TT

A h

olds

a 5

7.42

% (2

013:

57.

14%

) sta

ke

in M

erm

aid

Mar

itim

e P

lc. a

nd a

51%

sta

ke

in G

ulf A

genc

y C

ompa

ny (

Tha

iland

) Lt

d.

Mer

mai

d M

ariti

me

Plc

. en

gage

d G

ulf

Age

ncy

Com

pany

(T

haila

nd)

Ltd.

for

cust

oms

clea

ranc

e of

goo

ds,

tran

spor

tatio

n.

-

(No

tran

sact

ion

in 2

014)

)

23,8

46,8

78

(Rec

orde

d as

offs

hore

expe

nses

)

Sam

e pr

ice

as n

orm

ally

char

ged

to a

third

par

ty

Tra

nsa

ctio

ns

wit

h P

erso

ns

wh

o M

ay H

ave

Co

nfl

icts

of

Inte

rest

Co

mp

anie

sR

elat

ed P

arty

Co

mp

anie

s/E

nti

ties

Rel

atio

nsh

ipD

escr

ipti

on

of

Tra

nsa

ctio

ns

Tra

nsa

ctio

nA

mo

un

t (B

aht)

Pri

cin

g P

olic

y30

Sep

t 20

1430

Sep

t 20

13

1. T

hore

sen

Tha

i Age

ncie

s

P

lc.

Mer

mai

d M

ariti

me

Plc

.T

TA

hol

ds a

57.

42%

(201

3: 5

7.14

%) s

take

in M

erm

aid

Mar

itim

e P

lc.

(“M

erm

aid”

) an

d M

r. C

hale

rmch

ai

Mah

agits

iri is

sha

reho

lder

of b

oth

TT

A a

nd M

erm

aid.

TT

A p

rovi

ded

IT C

o-lo

catio

n se

rvic

es to

Mer

mai

d.

366,

811.

50

(Rec

orde

d as

IT a

nd o

ther

serv

ice

inco

me)

621,

310.

50

(Rec

orde

d as

IT a

nd o

ther

serv

ice

inco

me)

In li

ne w

ith m

arke

t

2. T

hore

sen

Tha

i Age

ncie

s

P

lc.

Mer

mai

d M

ariti

me

Plc

.T

TA

hol

ds a

57.

42%

(201

3: 5

7.14

%) s

take

in M

erm

aid

Mar

itim

e P

lc. a

nd

Mr.

Cha

lerm

chai

Mah

agits

iri is

shar

ehol

der

of b

oth

TT

A a

nd M

erm

aid

Mar

itim

e P

lc.

TT

A r

en

t o

ffic

e s

pa

ce o

n 9

th F

loo

r,

Ora

karn

Bui

ldin

g fr

om M

erm

aid.

1,72

2,60

0

(Rec

orde

d as

rent

al-o

ffice

expe

nses

)

710,

663.

50

(Rec

orde

d as

rent

al-o

ffice

expe

nses

)

In li

ne w

ith m

arke

t

3. T

hore

sen

Tha

i Age

ncie

s

P

lc.

Mer

mai

d D

rillin

g Lt

d.T

TA

hol

ds a

57.

42%

(201

3: 5

7.14

%) s

take

in M

erm

aid

Mar

itim

e P

lc.

and

Mer

mai

d M

ariti

me

Plc

.

hold

s a

95%

in M

erm

aid

Dril

ling

Ltd.

Mr.

Cha

lerm

chai

Mah

agits

iri is

shar

ehol

der

of b

oth

TT

A a

nd M

erm

aid

Mar

itim

e P

lc.

TT

A r

ent o

ut o

ffice

spa

ce o

n 10

th F

loor

,

Ora

karn

Bui

ldin

g to

Mer

mai

d D

rillin

g Lt

d.

68,9

54.7

5

(Rec

orde

d as

rent

al a

nd

faci

litie

s in

com

e)

-

(No

tran

sact

ion

in 2

013)

In li

ne w

ith m

arke

t



Co

mp

anie

sR

elat

ed P

arty

Co

mp

anie

s/E

nti

ties

Rel

atio

nsh

ipD

escr

ipti

on

of

Tra

nsa

ctio

ns

Tra

nsa

ctio

nA

mo

un

t (B

aht)

Pri

cin

g P

olic

y30

Sep

t 20

1430

Sep

t 20

13

4. M

erm

aid

Mar

itim

e P

lc./

M

erm

aid

Offs

hore

S

ervi

ces

Ltd.

,/

M

erm

aid

Dril

ling

Ltd.

PM

Tel

ecom

Co.

, Ltd

.T

TA

hol

ds a

57.

42%

(20

13:

57.1

4%)

stak

e in

Mer

mai

d M

ariti

me

Plc

.,

Mer

mai

d M

ariti

me

Plc

. ho

lds

a 10

0%

stak

e in

Mer

mai

d O

ffsho

re S

ervi

ces

Ltd.

an

d h

old

s a

95

% s

take

in

Me

rma

id

Dril

ling

Ltd.

Tho

se c

ompa

nies

hav

e co

mm

on

dire

ctor

with

PM

Tel

ecom

Co.

, Ltd

. bei

ng

Mr.

Cha

lerm

chai

Mah

agits

iri.

Mer

mai

d M

ariti

me

Plc

.,

Mer

mai

d O

ffsho

re S

ervi

ces

Ltd.

and

Mer

mai

d D

rilli

ng L

td.

boug

ht m

obile

phon

es fr

om P

M T

elec

om C

o., L

td.

-

(No

tran

sact

ion

in

2014

)

754,

794.

86

(Rec

orde

d as

fixed

ass

ets)

Sam

e pr

ice

as n

orm

ally

char

ged

by a

third

par

ty

5. T

hore

sen

Tha

i

A

genc

ies

Plc

.

PM

Tel

ecom

Co.

, Ltd

.T

TA

and

PM

Tel

ecom

Co.

, Lt

d. h

ave

com

mon

dire

ctor

s be

ing

Mr.

Cha

lerm

chai

Mah

agits

iri,

Ms.

Aus

ana

Mah

agits

iri a

nd

Mr.

Chi

a W

an H

uat J

osep

h.

TT

A b

ough

t m

obile

pho

nes

from

PM

Tel

ecom

Co.

, Ltd

.

-

(No

tran

sact

ion

in

2014

)

52,9

00

(Rec

orde

d as

fixed

ass

ets)

Sam

e pr

ice

as n

orm

ally

char

ged

by a

third

par

ty

6. T

hore

sen

Tha

i

A

genc

ies

Plc

.

Fou

r O

ne O

ne

Ent

erta

inm

ent C

o., L

td.

TT

A a

nd F

our

One

One

Ent

erta

inm

ent

Co.

, Ltd

. hav

e co

mm

on d

irect

ors

bein

g

Mr.

Cha

lerm

chai

Mah

agits

iri a

nd

Ms.

Aus

ana

Mah

agits

iri.

TT

A e

ngag

ed F

our

One

One

Ent

erta

inm

ent C

o., L

td. t

o or

gani

ze

the

2013

Sta

ff N

ew Y

ear

Par

ty.

2,88

8,68

8.94

(Rec

orde

d as

adm

inis

trat

ive

expe

nses

)

-

(No

tran

sact

ion

in 2

013)

Sam

e pr

ice

as n

orm

ally

char

ged

by a

third

par

ty



Necessity and Rationale of Related Party Transactions

In case TTA or its subsidiary signs an agreement or conducts a related party transaction with a subsidiary company, affiliated company and/or third party, TTA or a subsidiary will consider the necessity and rationale of such agreement based mainly on TTA’s interests.

Approval Measures or Procedures of Related Party Transactions

If TTA or its subsidiary is to execute an agreement or if there is any related party transaction between TTA and its subsidiary, affiliated company, related company, third party and/or anyone with possible conflict of interests, the Board of Directors requires TTA or a subsidiary, for the purpose of its benefits, to comply with the rules and regulations of the SET and the SEC regarding disclosure of information of listed companies concerning connected transactions. Prices and other conditions shall be on an arm’s length basis and are conducted in the best interests of TTA and all shareholders. Directors, executives, or employees having an interest in such transaction are not allowed to participate in the decision-making process and in any approval process.

Policy for Future Related PartyTransactions

The Audit Committee and TTA will jointly consider and review any related party transactions that may arise in the future to ensure their necessity and fair price basis.



CoMpANy INvESTMENTS

No. Name of CompanyType of Shares

# of Issued Shares

# of Invested Shares

% of Holding

ParValue

Group TransportType of Business : Ship Management

1 Thoresen & Company (Bangkok) Limited

26/26-27 Orakarn Building, 8th Floor

Chidlom Road, Lumpinee, Pathumwan

Bangkok 10330

Tel. : +66 (0) 2250-0569

Ordinary 9,470,000 9,470,000 99.9/1 THB

Preference 3,030,000 3,029,994 10

2 Premo Shipping Plc.


Soi Chidlom, Ploenchit Road, Lumpinee

Pathumwan, Bangkok 10330

Tel. : +66 (0) 2250-0569

Ordinary 73,935,500 73,935,190 99.9 THB

100

Type of Business : International Maritime Transportation

3 Thoresen Chartering (HK) Limited

Suite B, 12th Floor, Two Chinachem Plaza

135 Des Voeux Road Central, Hong Kong

Ordinary 500,000 499,999 99.9 HKD

1

4 Thoresen Shipping Singapore Pte. Ltd.

3 Church Street, #22-06 Samsung Hub

Singapore 049483

Tel. : +65 6578-7000

Ordinary 434,417,561 434,417,561 100.0 SGD

1

5 Thoresen Shipping Germany GmbH

Stavendamm 4a, 28195 Bremen, Germany

Tel. : 421 336 52 22

Ordinary 25,000 25,000 100.0 EUR

1

6 Thoresen Shipping Denmark ApS

Tuborg Boulevard 12, 3.

2900 Hellerup, Denmark

Ordinary 80,000 80,000 100.0/1 DKK

1

7 Thoresen Shipping South Africa (PTY) Ltd.

2401 ABSA Centre, Heerengracht

Cape Town, Western Cape 8001

South Africa

Tel. : +27 21 680 5025

Ordinary 3,000 3,000 100.0/1 -

Type of Business : Ship Agency

8 Thoresen Shipping and Logistics Ltd.


Soi Chidlom, Ploenchit Road, Lumpinee

Pathumwan, Bangkok 10330

Tel. : +66 (0) 2254-0266

Ordinary 500,000 245,000 49.0 THB

100

Investments in other companies exceeding 10% of other companies’ shares as of 30 September 2014 are as follows:

CoMPANy INvESTMENTS



# of Issued Shares


% of Holding

ParValue

9 Gulf Agency Company (Thailand) Ltd.26/30-31 Orakarn Building, 9th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2650-7400

Ordinary 22,000 11,215 51.0 THB1000

10 Thoresen Shipping FZE1901-19th Floor, Golden TowerOpp. Marbella Resort, Al BuhairahCorniche Road, Sharjah, UAETel. : 971-6-574 2244

Ordinary 1 1 100.0 AED550,550

11 Thoresen (Indochina) S.A.17th Floor, Petroland Tower12 Tan Trao Street, Tan Phu Ward District 7 Ho Chi Min City, VietnamTel. : +84 8 5411 1919

Ordinary 2,500 1,250 50.0 USD100

Type of Business : Ship Brokerage

12 Fearnleys (Thailand) Ltd.26/55 Orakarn Building, 15th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2253-6160

Ordinary 135,000 66,144 49.0 THB100

13 Thoresen Chartering (Pte) Ltd.3 Church Street, #22-06 Samsung HubSingapore 049483Tel. : +65 6578-7000

Ordinary 100,000 100,000 100.0 SGD1

Type of Business : Oil and GasTankering

14 Petrolift Inc. 6th Floor, Mapfre Insular Corporate CenterMadrigal Business Park I, 1220Acacia Avenue, Ayala AlabangMuntinlupa City, Philippines

Ordinary 1,259,350,452 503,740,176 40.0/4 PHP1

Group Energy Type of Business : Offshore Services

15 Mermaid Maritime Plc.26/28-29 Orakarn Building, 9th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2255-3115-6

Ordinary 1,413,081,038 700,000,000 57.4 THB

20,398,420/3 1

90,934,393/4

Type of Business : Coal Mining

16 Merton Group (Cyprus) Ltd./6

Nikou Kranidioti 7D, Tower 4, 3rd FloorFlat/Office 302, Egkomi, PC 2411Nicosia, Cyprus

Ordinary 63,370 8,704 13.7/4 USD1

17 Qing Mei Pte. Ltd./6

24 Duxton Hill, Singapore 089607Ordinary 12,600,000 4,200,000 33.3/4 USD

1

Group InfrastructureType of Business : Ship Supplies, Logistics, Ship Stevedoring and Transportation

18 Chidlom Marine Services & Supplies Ltd.26/22-23 Orakarn Building, 7th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2250-0569

Ordinary 700,000 699,993 99.9 THB100

CoMPANy INvESTMENTS



# of Issued Shares


% of Holding

ParValue

19 GAC Thoresen Logistics Ltd.26/30-31 Orakarn Building, 9th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 3818-5090-2

Ordinary 750,000 382,496 51.0 THB

100

Type of Business : Port Operations

20 Sharjah Ports Services LLCP.O.Box 510, Port KhalidSharjah, United Arab EmiratesTel. : 971-6-528 1327

Ordinary 150,000 73,500 49.0/2 AED100

21 Baria SerecePhu My Borough, Tan Thanh DistrictBaria Vung Tau Province, VietnamTel. : +84 64 3876 603

Ordinary 2,039,080 407,816 20.0/4 VND100,000

Type of Business : Coal Logistics Business

22 Unique Mining Services Plc.26/54-55 Orakarn Building, 15th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2655-7501-2

Ordinary 153,454,064 136,083,041 88.7/3 THB0.5

Type of Business : Fertilisers Business

23 Baconco Co., Ltd.Phu My I Industrial Park, Tan Thanh TownBaria Vung Tau Province, VietnamTel. : +84 64 3893 400

Charter capital is VND 377,072,638,790

100.0/5 -

OthersType of Business : Investment Holding

24 Soleado Holdings Pte. Ltd.3 Church Street, #22-06 Samsung HubSingapore 049483Tel. : +65 6578-7000

Ordinary 130,000,000 130,000,000 100.0 SGD1

25 Athene Holdings Ltd.26/32 Orakarn Building, 10th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2254-8437

Ordinary 1,000,000 999,993 99.9 THB100

26 PM Thoresen Asia Holdings Plc.26/22-23 Orakarn Building, 7th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2254-8437

Ordinary 93,100,000 93,099,998 99.9 THB10

Type of Business : Service Provider

27 Thoresen Services Center Ltd.26/22-23 Orakarn Building, 7th FloorSoi Chidlom, Ploenchit Road, LumpineePathumwan, Bangkok 10330Tel. : +66 (0) 2254-8437

Ordinary 60,000,000 599,993 99.9 THB100

Note: /1 indirectly held through Thoresen Shipping Singapore Pte. Ltd. /2 indirectly held through Thoresen Shipping FZE /3 indirectly held through Athene Holdings Ltd. /4 indirectly held through Soleado Holdings Pte. Ltd. /5 indirectly held through PM Thoresen Asia Holdings Plc. /6 the investments were classified as assets held for sale under current assets in the consolidated financial statements as at 30 September 2014.

CoMPANy INvESTMENTS


The following are definitions of key terms used in this annual report.

Glossary of Maritime Terms:BHSI The Baltic Handysize Index is a measure of the strength of smaller dry bulk

vessel spot freight earnings (basis 28,000 dwt bulk carriers). It was established on a trial basis in May 2006 and was formally launched in January 2007.

BSI The Baltic Supramax Index (“BSI”) (basis 52,000 dwt bulk carriers) was officially launched in January 2006.

Bulk Vessels/Carriers Vessels which are specially designed and built to carry large volumes of cargo in bulk cargo form.

Charter The hire of vessel or drilling rig for a specified period of time or in the case of bulk carriers to carry cargo for a fixed fee from a loading port to a discharging port. The contract for a charter is called a charterparty.

Charterer The individual or company hiring a vessel.

Charter Hire Rate A sum of money paid to the vessel or drilling rig owner by a charterer under a charterparty for the use of a vessel or drilling rig.

Classification Society An independent organisation which certifies that a vessel or drilling rig has been built and maintained in accordance with the rules of such organisation and complies with the applicable rules and regulations of the country of such vessel or drilling rig and the international conventions of which that country is a member.

Deadweight Tonne (“dwt”) A unit of a vessel’s capacity for cargo, fuel oil, stores and crew, measured in metric tons of 1,000 kilograms. A vessel’s dwt, or total deadweight, is the total weight the vessel can carry when loaded to a particular load line.

Deepwater For dive support vessels, this refers to water depths beyond 300 metres. For drilling, this comprises “5th Generation Deepwater”, which refers to the latest generation of semisubmersible rigs and drillships possessing the latest technical drilling capabilities and the ability to operate in water depths in excess of 7,000 feet. “Other Deepwater” refers to semisubmersible rigs and drillships that possess the ability to drill in water depths greater than 4,500 feet.

Dive Support Vessel Specially equipped vessel that performs services and acts as an operational base for divers, remotely operated vehicles, and specialised equipment.

DP2 Dynamic position 2 - redundancy allows the vessel to maintain position even with failure of one component or subsystem, required for vessels which support manned diving operations.

Dry Bulk Non-liquid cargoes of commodities shipped in an unpackaged state.

GloSSARy

GloSSARy


Dry-docking The removal of a vessel or drilling rig from the water for inspection and / or repair of submerged parts.

Dynamic Position (“DP”) Computer-directed thruster systems that use satellite-based positioning and other positioning technologies to ensure the proper counteraction to wind, current, and wave forces enabling the vessel to maintain its position without the use of anchors.

Freight Rates A price at which a certain cargo is delivered from one point to another. The price depends on the form of the cargo, the mode of transport (truck, ship, train, aircraft), the weight of the cargo, and the distance to the delivery destination. Many shipping services, especially air carriers, use dimensional weight for calculating the price, which takes into account both weight and volume of the cargo.

Handymax A dry bulk carrier of approximately 35,000 to 60,000 dwt.

Handysize A dry bulk carrier having a carrying capacity of up to approximately 35,000 dwt.

Hull The shell or body of a vessel.

International Maritime A United Nations agency that issues international trade standards for shipping.Organization (“IMO”)

Metric Tonne A unit of measurement equal to 1,000 kilograms.

Newbuilding A newly constructed vessel.

Orderbook A reference to currently placed orders for the construction of vessels or drilling rigs (e.g., the Handymax orderbook).

Panamax A dry bulk carrier of approximately 60,000 to 80,000 dwt of maximum length, depth and draft capable of passing fully loaded through the Panama Canal.

Remotely Operated Vehicles Robotic vehicles used to complement, support, and increase the efficiency of

(“ROV”) diving and sub-sea operations and for tasks beyond the capability of manned diving operations.

Scrapping The disposal of old or damaged vessel tonnage by way of sale as scrap metal.

Short-Term Time Charter A time charter which lasts less than approximately twelve months.

Supramax A bulk carrier with a capacity less than 60,000 dwt. Supramax vessels are rel-atively bigger in size with 50,000 to 60,000 dwt. It is well suited for small ports with length and draught restrictions, or ports lacking transshipment infrastructure.

Tender Rig A tender rig is a purpose-built self-erecting drilling tender barge with a flat bottom, raked sterns, and raked bow hull shape. It is designed as a cost-efficient and flexible drilling system for development scenarios involving multiple well slot fixed offshore platforms whereby the rig moves from platform to platform using its own drilling equipment set which is lifted by its own crane. Lifting operations can be made onto platforms up to a height of 90 feet above sea level.

Time Charter Contract for hire of a vessel. A charter under which the vessel owner is paid charter hire rate on a per day basis for a certain period of time, the vessel owner being responsible for providing the crew and paying operating costs while the charterer is responsible for paying the voyage costs. Any delays at port or during the voyages are the responsibility of the charterer, save for certain specific exceptions such as loss of time arising from vessel breakdown and routine maintenance.

GloSSARy


TOE Tonne of Oil Equivalent. A unit of energy: the amount of energy released by burning one tonne of crude oil, approximately 42 GJ. TOE is sometimes used for large amounts of energy, as it can be more intuitive to visualise, say, the energy released by burning 1000 tonnes of oil than 42,000 billion joules (the SI unit of energy).

Voyage Charter Contract for hire of a vessel under which a vessel owner is paid freight on the basis of moving cargo from a loading port to a discharge port. The vessel owner is responsible for paying both operating costs and voyage costs. The charterer is typically responsible for any delay at the loading or discharging ports.

Glossary of Coal Terms:Anthracite Coals with a volatile-carbon ratio equal to 0.12 or less. It has a bright black luster

and is coal of the highest rank.

Bituminous Coal A general term descriptive of coal intermediate in rank between sub bituminous and semi-anthracite and including coking coals. Bituminous coals may be either bright or dull and are usually banded in appearance.

Calorific Value Quantity of heat produced when a unit weight of coal burns. Calorific value is measured in British thermal units per pound or calories per gram.

Coal Mine An area of land and all structures, facilities, machinery, tools, equipment, shafts, slopes, tunnels, excavations and other property, real or personal, placed upon, under or above the surface of such land by any person, used in, or to be used in, or resulting from the work of extracting in such area bituminous coal, lignite, or anthracite from its natural deposits in the earth by any means or method and the work of preparing the coal so extracted and includes custom coal preparation facilities.

Lignite A brownish-black coal composed of vegetable matter which has been altered more than in peat, but less than in sub-bituminous coal.

Calorific Value The energy in kilocalories released per kg of coal burned.

Sub-bituminous Sub-bituminous coals may be dull, dark brown to black, soft and crumbly at the lower end of the range, to bright jet-black, hard, and relatively strong at the upper end. They contain 15-30% inherent moisture by weight and are non-coking (undergo little swelling upon heating).

Sulphur Forms sulphur dioxide during coal combustion.

Glossary of Fertiliser Terms:Urea The most common nitrogen fertiliser in the world. Formula CO(NH2)2, can be

prilled or granular, and obtained by chemical process (natural gas into ammonia, and then urea).

NPK Stands for “Nitrogen Phosphorus Potassium”, used to mention the compound fertilisers associating the three main fertilising nutrients, to be differentiated from the single fertilisers.

Blending Or “bulk blending” is a physical process mixing single fertilisers together to obtain NPK fertilisers.

Granulation Process using steam, water and heat to manufacture NPK fertilisers, thereafter called granulated fertilisers.

Compaction Process using heat and pressure to manufacture NPK fertilisers, thereafter called compacted fertilisers.

GloSSARy


CoMpANyINfoRMATIoN

As of 30 September 2014

Name of Company : Thoresen Thai Agencies Public Company Limited

Initial : TTA

Registration No. : 0107537002737

Date of Establishment : 16 August 1983

Date of Conversion to Public Company Limited : 15 December 1994

Date of Listing Ordinary Shares in SET : 25 September 1995

Type of Business : Investment Holding with 3 lines of business:Transport, Energy, and Infrastructure

Office Address : 26/26-27 Orakarn Building, 8th Floor Soi Chidlom, Ploenchit Road Bangkok 10330, ThailandTelephone: +66 (0) 2254-8437Facsimile: +66 (0) 2655-5631Email: [email protected]: http://www.thoresen.com

Investor Relations Department : Telephone: + 66 (0) 2254-8437 ext 292Facsimile: +66 (0) 2655-5631Email: [email protected]

Company Secretary Office and Corporate Affairs Department

: Telephone: + 66 (0) 2254-8437 ext 144Facsimile: +66 (0) 2655-5631Email: [email protected]

Internal Audit Department : Telephone: + 66 (0) 2254-8437 ext 515Facsimile: + 66 (0) 2655-5635

Ordinary Shares

Registered Capital : Baht 1,544,105,835

Paid up Capital : Baht 1,293,234,815

No. of Issued Shares : 1,293,234,815 ordinary shares

Par Value : Baht 1 per share

Warrants (TTA-W3)

Number of Warrants Issued : 141,600,255 units

Number of Warrants Unexercised : 138,840,117 units

Exercise Price : Baht 16.1655 per 1 ordinary share (after the exercise price adjustment in February 2014)

Warrant Issue Date : 11 March 2013

Term of Warrants : 30 months or 2.5 years from the warrant issue date

Warrants (TTA-W4)

Number of Warrants Issued : 99,369,017 units

Number of Warrants Unexercised : 98,224,727 units

CoMPANy INfoRMATIoN


Exercise Price : Baht 18.50 per 1 ordinary share

Warrant Issue Date : 14 March 2014

Term of Warrants : 36 months or 3.0 years from the warrant issue date

Domestic Debentures

Issued Domestic Debentures : Tranche 1: Baht 2,000 million, with 5-year termTranche 2: Baht 2,000 million, with 7-year term

Date of Listing Domestic Debentures in Thai Bond Market Association

: 9 July 2010

Reference PersonsRegulator : Securities and Exchange Commission, Thailand

333/3 Viphavadi Rangsit Road, Chomphon, ChatuchakBangkok 10900, ThailandTelephone: +66 (0) 2695-9999Facsimile: +66 (0) 2695-9660Email: [email protected]: http://www.sec.or.th

Regulator : The Stock Exchange of Thailand Building62 Ratchadaphisek Road, Klongtoey, Bangkok 10110, ThailandTelephone: +66 (0) 2229-2000, +66 (0) 2654-5656Facsimile: +66 (0) 2229-2030, +66 (0) 2654-5649S-E-T Call Center: +66 (0) 2229-2222Email: [email protected]: http://www.set.or.th

Securities Registrar of Ordinary Shares and Warrants

: Thailand Securities Depository Co., Ltd.The Stock Exchange of Thailand Building 62 Rachadapisek Road, Klongtoey Bangkok 10110, Thailand Telephone: +66 (0) 2229-2800TSD Call Center: +66 (0) 2229-2888Facsimile: +66 (0) 2359-1259Email: [email protected]: http://www.tsd.co.th

Debenture Registrar : Siam Commercial Bank Plc.9 Rutchadapisek Rd.Jatujak, Jatujak, Bangkok, 10900 ThailandTelephone: +66 (0) 2544-1000Facsimile: +66 (0) 2544-2658

Auditor : Mr. Veerachai RatanajaratkulCertified Public Accountant Registration No. 4323KPMG Phoomchai Audit Ltd.48th - 51st Floors, Empire Tower, 195 South Sathorn RoadYannawa, Sathorn, Bangkok 10120, ThailandTelephone: +66 (0) 2677-2000Facsimile: +66 (0) 2677-2222

Legal Advisor : Baker & McKenzie Ltd.5th Floor, 22nd - 25th Floor, Abdulrahim Place990 Rama IV Road, Srilom, Bangrak, Bangkok 10500, ThailandTelephone: +66 (0) 2636-2000Facsimile: +66 (0) 2636-2111

Legal Advisor : Watson, Farley & Williams Asia Practice LLP6 Battery Road #28-00 Singapore 049909Telephone: +65 6532 5335Facsimile: +65 6551 9221

Remark: Investors can study additional details of the issuer from the Company’s Annual Information Disclosure Form (Form 56-1)

on the SEC’s website at http://www.sec.or.th or on the Company’s website at http://www.thoresen.com.

CoMPANy INfoRMATIoN

THORESEN THAI AGENCIES PLC.

26/26-27 Orakarn Building, 8th Floor, Soi Chidlom, Ploenchit Road

Lumpinee, Pathumwan, Bangkok 10330, Thailand

Tel : +66 (0) 2250 0569-74, +66 (0) 2254 8437

Fax : +66 (0) 2655 5631

Website : http://www.thoresen.com