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Financial Highlights................................................................................................................................................................12
Message from the Chairman of the Board...........................................................................................................................14
Message from the President and CEO.........................................................................................................................................16
Products and Services...........................................................................................................................................................18
Community Program..............................................................................................................................................................22
Independent Directors............................................................................................................................................................23
Corporate Governance Report...............................................................................................................................................27
Company Background and Major Developments..................................................................................................................34
Awards...................................................................................................................................................................................36
Revenues Breakdown by Business Group............................................................................................................................37
Corporate Information........................................................................................................................................................... 38
References.............................................................................................................................................................................43
Group of Investment Structure..............................................................................................................................................44
Risk Factors...........................................................................................................................................................................45
Shareholders..........................................................................................................................................................................47
Dividend Policy.......................................................................................................................................................................48
Management..........................................................................................................................................................................49
Connected Transactions........................................................................................................................................................82
Audit Fees..............................................................................................................................................................................83
Report of the Audit Committee for the Year 2004...............................................................................................................84
Report of the Board of Directorsû Responsibilities for Financial Statements 2004 .............................................................85
Managementûs Discussion and Analysis................................................................................................................................86
Financial Statements..............................................................................................................................................................93
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TrueFun
Fun doesnût really come from playing with toys,
it comes from playing together.
TrueSuccess
When we have each other, the task is already half done.
12 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
2004
Consolidated Financial Results
Total revenues
EBITDA (normalized) 1/
Operating profit 2/
Net profit (loss)
Consolidated Balance Sheets and Cash Flows
Total assets
Total liabilities
Total shareholderûs equity
Free cash flow 3/
Free cash flow, excluding TA Orange 3/
Key Financial and Efficiency Ratios
EBITDA margin
Operating profit margin
Asset Turnover
EBITDA / Interest coverage ratio (Times)
Net debt / EBITDA (Times)
EBITDA / Interest coverage ratio, excluding TA Orange (Times)
Net debt / EBITDA, excluding TA Orange (Times)
Per Share Data and Others
Loss per share (Baht) 4/
Book value per share (Baht)
Share price at year end (Baht)
No. of outstanding shares at year end (Million shares)
Market capitalization
(Unit : Million Baht)
2003
2002
33,010
13,164
1,379
605
27,950
11,642
491
(5,674)
25,783
9,798
521
(5,395)
102,625
97,888
4,738
3,419
6,231
86,760
85,265
1,495
(3,303)
5,162
92,977
85,779
7,198
(4,298)
4,682
39.9%
4.2%
32.2%
3.1
6.0
3.6
4.3
41.7%
1.8%
32.2%
2.6
5.9
3.1
4.7
38.0%
2.0%
27.7%
2.5
6.6
3.2
5.1
(0.03)
1.16
8.10
4,092.53
33,149.47
(2.13)
0.40
7.30
3,694.50
26,969.83
(2.34)
1.95
4.60
3,694.50
16,994.70
2/ Excluding one-time write-off for PCT subscriber acquisition cost of Baht 215
1/ Excluding one-off transactions which consisted of the followings;
million in 2003.
- out-of-period booking of leased circuit and conduit rental of Baht 286 million in 2002,
3/ Cash flow from operations less capital expenditure.
- one-time compensation of Baht 33 million for workforce reduction in 2002.
4/ After accumulated dividend for preferred shares.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 13
12
Revenue Diversification
High growth businesses contributed 37% of service revenue in FY 2004 compared to 17% in FY 2002.
26.7%
Orange
Data/Broadband/Internet
WE PCT
Others
0.7%
5.2%
4.0%
Wireline
53.4%
Remark : Data/Broadband/Internet group refers to DDN,
Multimedia and Internet segments in the audited financial
statements.
Bt Mn.
Key Growth Drivers
TA Orange surging growth
TA Orange contribution*
Remark : * Based on a proportionate consolidation up to 3Q04,
and changed to full consolidation since 4Q04.
1
165
2004
No.1 Broadband and Internet player
Revenue (Bt Mn)
Subscribers (,000)
1,231
Consumer Broadband
Internet
888
4
Revenue (Bt Mn)
Users (,000)
Revenue (Bt Mn)
Subscribers (,000)
14 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Our 2004 results show
our transformation
has been a success,
our strategy is working
and most importantly
we are delivering
what consumers want.
In 2005 we will build on
what we have achieved
and continue producing
high quality and innovative
communications
solutions that enrich our
customersû lives.
Mr. Dhanin Chearavanont
Chairman of the Board
If we can maintain
this focus, which I am
confident we can,
we will be in a good
position to prosper
further as the
Thai telecommunications
industry is liberalized.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 15
the
Chairman of the Board
from
Telecommunication usage and competition continued to increase in Thailand in 2004, especially in the mobile and
Internet sectors. Total Internet penetration jumped from 9 percent to 11 percent, with Broadband use, although still relatively
small, surging by more than 13 folds.
Mobile phone penetration also continued its steady rise, increasing from 34 percent to 41 percent of the population, and
for the first time large numbers of Thai consumers started enjoying the benefits of non-voice mobile services, such as
downloadable financial information, games and photo-based communication and community services. And as Thai appetites
for high-speed connectivity and convenient lifestyle services grew during the year, I am proud that True has been at the
forefront of meeting these needs.
In 2003 and 2004 we made major organizational and other changes to ensure we were strategically well placed to drive
emerging trends. The biggest change was our decision to establish ourselves under a new brand, as well as strengthen
ourselves both technically and financially so that we could become Thailandûs leading customer-focused total communications
solutions provider. Subsequent brand campaigns, conducted both externally and internally during the year were designed to
leverage on synergies within the True Group and enhance our ability to serve in ways that matter the most to our
customers by enhancing their life styles.
Our 2004 results show our transformation has been a success, our strategy is working and most importantly we are
delivering what consumers want. In 2005 we will build on what we have achieved and continue producing high quality and
innovative communications solutions that enrich our customersû lives. If we can maintain this focus, which I am confident we
can, we will be in a good position to prosper further as the Thai telecommunications industry is liberalized.
16 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
the
President and CEO
from
The True Group ended 2004 stronger than ever before. All aspects of our business were strengthened and foundations
were laid for continuing future growth. True has become Thailandûs largest Internet Service Provider, its largest Broadband
operator and Thailandûs most integrated communications solutions provider. Across the Group debt was reduced and
restructured in 2004, equity was increased, cash flow and revenue remained strong and strategies were put in place to
stabilize and enhance core businesses.
TA Orange, our mobile phone subsidiary, had a particularly good year. It launched a wide range of non-voice services,
beat expectations by almost doubling subscribers, and is firmly on track to make a maiden profit in 2006. With True taking
a majority shareholding in TA Orange and negotiating new long term financing, the challenge now is to fully integrate TA
Orange into the True Group and leverage synergies between it and other subsidiaries so that we can offer a whole new range
of integrated solutions that enhance customer lifestyles.
A key aspect of this will be the development of more high-speed content and the bundling of products and services into
customized packages with single billing. Achieving this will be challenging as we are likely to face more intense competition
than ever before. But I am confident that with the progress made in 2004, the leadership attained in key markets, and our
proven ability to adapt and innovate, we will maintain momentum.
I would like to extend my thanks to shareholders, members of the Board, management and all True Group staff for their
dedication and hard work during the year. I hope you all feel as I do that the best is yet to come.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 17
I would like to
extend my thanks
to shareholders,
members of the Board,
management and
all True Group staff
for their dedication
and hard work
during the year.
I hope you all feel
as I do
that the best
is yet to come.
Mr. Supachai Chearavanont
President and CEO
18 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
At home, on the move, in the office or factory our customers want convenient, fast and cost effective ways to stay
connected that enhance their life and work styles. In 2004 we continued to meet the lifestyle and commercial needs of this
diverse group by launching a wide range of innovative and affordable solutions using a number of channels.
Business Solutions
For our business customers, fast and reliable communications are a commercial life blood and a vital means to grow
revenue, reduce expenses and reach out to more customers. With this in mind we opened the True Internet Data Centre
(True IDC) in mid-2004 to provide businesses with convenient access to the full range of Internet services, including
web hosting, web-based monitoring and secure and efficient data storage.
True IDC, which is a joint venture with Korean Company Dacom Corporation and KIDC, the biggest IDC operator in
Asia, provides Thai businesses with the tools to face increased competition at home and abroad and access to cutting edge
Internet solutions to drive business growth.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 19
For our small and medium enterprise customers (SMEs) we launched the çAll in One Solutioné after research showed
some Thai SMEs lacked understanding of how to use technology to increase productivity. The SME All in One Solution by True
- the first total solution for SMEs in Thailand - is a package of four bundled product and service solutions that take care of
all an SMEûs communications, marketing, business process and ICT for office and business management needs. SMEs can
choose one customized solution to meet their needs or sign up for all four and receive full support from a team of True ICT
professionals. We also launched a çPlug and Playé variation of the çAll in One Solutioné for industrial estate SMEs.
Home/Consumer Solutions
Home consumers have greatly benefited from our year-long launch of low-cost unlimited high-speed local and international
Internet access packages. In January we offered unlimited high-speed local Internet packages starting from Baht 550 per
month and in July we launched unlimited local and international Internet packages starting from Baht 590 a month (with a free
fixed line number) with access speeds up to 4 Mbps (mega-bits per second) - the highest speed ever offered in Thailand.
In October we launched another high-value Internet promotion, high speed access with a free ADSL modem and waived
access fee. Following by special service for Internet fans, including çTurbo on Demandé - express 2 Mbps Internet access
with rates charged for actual minutes used. We also announced that in the first half of 2005 we, along with pay TV operator
UBC, would be the first in Thailand to offer an ADSL Broadband television service which will allow users to view their choice
of a diverse range of programs on a computer whenever they want.
True also rolled out a range of innovative services using other channels and product platforms.
For fixed line customers we launched new flexible tariff packages in January 2004 which offered different calling plans
with call rates from Baht 1.5 to Baht 2.75 per minute and a set amount of talk time.
In February we launched the çPCT School Club,é a service that allows group members including teachers and students
to make unlimited calls between themselves using a special number for a fixed monthly charge. In September we renamed
PCT, çWE PCTé to reflect the strategy of building communities and bringing people together, and launched unlimited group
call and a çbuy-one, get one freeé handset promotions.
We also boosted our online game content. In January True Digital Entertainment began offering PristonTale, an award
winning Korean online game. In September we formed the joint venture company NC True with NCsoft, Koreaûs leading
developer and publisher of online games, to provide online games (MMORPG) starting with the most popular worldwide
MMORPG, çLineage IIé in Thailand.
20 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
In May we launched çHome Entertainment by Trueé, an online music service provided via high-speed Internet in
association with R.S. Promotions, an entertainment provider. In November we also joined hands with R.S. Promotions again
to add çKaraoke-on-Demand and Moviesé to our suite of çHome Entertainment by Trueé products obtainable via high-speed
Internet.
During 2004 True also maintained its position as Thailandûs leading Wi-Fi hotspot provider. Wi-Fi by True uses the latest
wireless communication technology and provides data transmission at speeds of up to 11 Mbps. By the end of 2004 we had
altogether - the highest amongst Wi-Fi players, 80 Wi-Fi hotspots in places such as convention centers, hospitals, and food
and coffee outlets. We plan to increase the number of Wi-Fi Internet service areas or hotspots from 80 to more than 300 in
2005.
TA Orange
During the year our mobile subsidiary TA Orange delivered on promises to be the best mobile operator in Bangkok; the
best for value, fun and games, the best for convenience and fixed-mobile-Internet integration and the fairest and most
competitive player.
In April, TA Orangeûs network was rated çBest in Bangkoké in a survey conducted by Synovate Ltd, under the guidance
of a testing team from King Mongkutûs Institute of Technology. Aided by a large marketing campaign, public awareness of
the quality of the companyûs network steadily increased.
During the year TA Orange leveraged on synergies with the True Group to emphasize the enhanced convenience and
benefits of using a wide range of True services. In April 2004, TA Orange and True unveiled the çAll Together Bonusé
campaign, which provided customers with free TA Orange talk time for every Baht they spent on home telephone, WE PCT,
Click Internet, Easy Internet and hi-speed Internet services. By the end of 2004, more than 200,000 customers had benefited
from this çbest for valueé promotion.
TA Orange led the market during the year with a steady stream of innovative pricing campaigns, including the çJust Talké
1 Baht per minute promotion, which other operators tried to match. It also launched a range of voice and non-voice content
services to enhance customerûs lifestyles. Three mobile phone community content products were unveiled during the first half
of 2004. In February, TA Orange launched çPhoto Worldé a complete suite of photo-based çfun and gamesé communication
and community services.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 21
In May it launched çFinancial Worldé, which brings together a range of information services to meet the needs of Thai
investors and in July TA Orange launched çGame Worldé, a complete games portal which allows customers to download
mobile games via GPRS from the multimedia service portal çOrange Worldé.
This was followed in October with the launch of çToon Worldé which enables customers to download games, cartoons,
screen savers and ring tones featuring well known cartoon characters. Also in October TA Orange signed a partnership
contract with Koreaûs SK Telecom for non-voice platform and marketing expertise, so it can develop even more innovative
information and çfun and gamesé non-voice products in 2005.
TA Orange also launched the exclusive çTodsaguné online game, joined forces with Workpoint Entertainment Public Company Limited
to offer consumers the game çTodsagun on Mobileé and linked up with Asiasoft International, the authorized provider of the
popular online game Ragnorak, to allow Just Talk customers to play the game on their mobile phones.
In addition, convenient new ways were introduced for Just Talk prepaid customers to top up their mobile phones,
including çMobile Top Upé, which lets customers transfer prepaid credits from one mobile phone to another and çHome Top
Upé, in which customers can use their True fixed-line account to top up their mobile phone. TA Orange also made top-up
e-vouchers available via 7-Eleven stores nationwide and launched micro (Baht 50 and Baht 90) top-up cards.
International SMS, which allows customers to send an International SMS to 447 mobile phone networks in 123
countries worldwide, was also launched and TA Orange and True unveiled Thailandûs first Voice SMS service that lets users
send audio messages to any mobile or fixed-line phone in Thailand.
In November, TA Orange and True revolutionized mobile connectivity for Thai consumers with the launch of Thailandûs
first combined Wi-Fi/GPRS package, which provides unlimited access to high speed data services at a flat monthly rate with
a single monthly bill.
22 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
TRUE Learning Center: Gateway to the Wide World
In line with the companyûs brand name change in 2004 to TRUE Corporation Public Company Limited, TelecomAsiaûs
learning center also took on a new identity - çTRUE Learning Center: Gateway to the Wide Worldé, embodying the companyûs
corporate culture and values which focus on courageous, caring, credible and creative.
During the year, TRUE had implemented numerous projects as part of its ongoing commitment to develop Thailand into a
knowledge-based society. As a continuation of its Information Communication Technology (ICT) project which was implemented
in 2001, TRUE selected 20 pilot schools with a high potential and then developed them further into an ICT Learning Center.
Subsequently, this was then expanded into a network comprising 100 public as well as private schools in the Greater Bangkok
Metropolitan Area. Likewise, TRUEûs Science Project saw an expansion from 9 selected pilot schools into a network of 60 schools
in the same area.
Besides the above, TRUE had also organized many educational activities during 2004:
ë Science Camp, which took place in the 9 pilot schools, serving as a model to be adopted by other schools
ë Support and development of educational media which was co-produced by teachers and young students.
ë Encourage the use ICT knowledge as an educational tool and information search utilizing internet, which would in turn
become the knowledge foundation for the ICT community.
TRUE Science-ICT Camp
This camp was held at King Mongkutûs Institute of Technology Ladkrabangûs Faculty of Science and was attended by over
300 students and teachers. The emphasis of the camp was to educate the participants on science hand in hand with ICT. In
addition, a TRUE Nature-Culture camp was also held for over 150 participants educating them on nature and the way of life in
the Bang Khunthien forest which is Bangkokûs only seafront area.
TRUE Young Scientist Program
This yearûs project received as many as 360 science projects from primary school students nationwide, representing a record
number of submissions since its establishment in 1993. During its 8-year history, 2 gold medals for the first time were awarded
to school children in the provinces.
TRUE Conservation
Photo Contest
In its 10th year, this popular project received a total of 899 submissions. In addition, the consolation prizes were increased
from 10 to 20 in both the wild animals and wild flora categories, bringing the total number of prizes to 46.
TRUE is committed to the ongoing development of Thailand into a knowledge-based society and at the same time aspires
to create inspiration for the Thai people for self-development to become a valuable citizen.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 23
Mr. Narong Srisa-an
Independent Director
Educat io n
Honorary Master Degree of Economics,
Thammasat University
Experience
1998-Present
Present
Independent Director
True Corporation Public Company Limited Present
Chairman
Advanced Agro Public Company Limited
Chairman
Prida Pramote Company Limited
Chairman
Thanakorn Vegetable Oil Products Company
Chairman
Surabangyikhan Company Limited
Chairman
Thai Beverage Can Limited
Chairman
Eastern Seaboard Industrial Estate (Rayong)
Company Limited
Chairman
Thai Alcohol Public Company Limited
Chairman of Executive Board
Siam Food Products Public Company
Limited
Chairman of Executive Board
Beer Thai (1991) Public Company Limited
Vice Chairman
Berli Jucker Public Company Limited
Vice Chairman
General Tobacco Company Limited
Vice Chairman
Thai Beverages Public Company Limited
Executive Director
Comlink Company Limited
24 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Mr. Vitthya Vejjajiva
Independent Director and
Chairman of the Audit Committee
Education
Master Degree of Laws,
Harvard University, U.S.A.
Master Degree of Arts,
University of Cambridge, London
Bachelor of Laws,
University of Cambridge, London
English Barrister,
Grayûs Inn Association
Experience
1998-Present
1991-1992
1988
Independent Director and
Chairman of the Audit Committee
True Corporation Public Company Limited
Chairman
K Line (Thailand) Company Limited and
its subsidiaries
Permanent Secretary of the Ministry of
Foreign Affairs
1984
1981
1979
Ambassador Extraordinary and
Plenipotentiary of the
United States of America
Ambassador Extraordinary and
Plenipotentiary of
Belgium and the European Community
Ambassador Extraordinary and
Plenipotentiary of Canada
Director, General of Department of
Economic Affairs
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 25
Dr. Kosol Petchsuwan
Independent Director and
Member of the Audit Committee
E du cation
Doctorate of Engineering,
University of London, England
Bachelor of Engineering,
University of London, England
Experience
1999- Present Independent Director and
Member of the Audit Committee
True Corporation Public Company Limited
1999- Present President
The Telecommunications Association of Thailand
2000-2001
Chairman,
The Aeronautical Radio of Thailand Limited
1997-2001
Director,
The Press Council of Thailand
1998-2000
Independent Director and
Member of the Audit Committee,
PTT Exploration and Production Public Company Limited
26 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Mr. Joti Bhokavanij
Independent Director and
Member of the Audit Committee
Education
Fellow of the Association of
Chartered Certified Accountants, England.
Programme for Management Development,
Harvard Business School (U.S.A.).
Marketing Management Programme,
Stanford University, Graduate School of Business (U.S.A.)
Experience
1999-Present
2000-2001
1994-1997
1992-1994
Independent Director and
Member of the Audit Committee
True Corporation Public Company Limited
Executive Chairman
TISCO Finance Public Company Limited
Executive Chairman
Thai Wah Group of Companies
Managing Director
The East Asiatic (Thailand) Company Limited
Consult-General of Denmark for Bangkok
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 27
The heart of TRUE is personified by the 4 Cs: being Credible, being Creative, being Caring and being Courageous.
These 4 core values are expressed in the principles by which TRUE governs itself. The results have been positive.
2004 marked the third consecutive year that TRUE has ranked amongst the very top companies in The Corporate
Governance Report of Thai Listed Companies. The Corporate Governance Report is published annually by the Thai Institute
of Directors Association (Thai IOD) under the auspices of the Stock Exchange of Thailand (SET) and the Securities and
Exchange Commission (SEC). In making its determinations, Thai IOD looks at five core criteria:
1) rights of shareholders,
2) equitable treatment of shareholders,
3) role of stakeholders,
4) disclosure and transparency, and
5) board responsibilities.
1. Rights of Shareholders
TRUE strives to ensure that every shareholder is given an opportunity to hear, to be heard and to make a difference.
Caring
çWe treat people the way we want to be treated.é
Over the course of 2004 shareholders were invited to participate in four meetings conveniently held at TRUEûs Bangkok
headquarters. One was a general meeting, and three were extraordinary meetings. At least 7 days before each meeting,
detailed information on every agenda topic was disseminated by post. Additionally, in order to ensure dissemination of
information to the general public, the agenda was shared by publication in local newspapers and on TRUEûs website. At the
beginning of each meeting, the procedures of the meeting was explained to all shareholders in attendance, and every
shareholder was given the opportunity to express an opinion on any matter discussed. Directors, the chairman or a
representative of each Board committee, and members of management attend each meeting so that effective responses can
be provided for all shareholder comments and questions.
28 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
By having allocated not less than four Board seats to Independent Directors (the definition and course training from
Thai Institute of Directors Association (Thai IOD) are provided in Management content), the opinions of minority shareholders
can be heard at the highest levels of the company. Independent Directors are free of any interest concerning personal benefit
or position and free from the control of any particular special interest. Each is obligated to express his or her independent
opinion to the Board.
Moreover, every Director must stand for election every 3 years and his performance is, thereby, subjected regularly to
the voting scrutiny of the shareholders. On all shareholder voting matters, each shareholder is entitled to exercise votes equal
in number to the amount of shares held by him or her. Prior to each shareholder meeting, a proxy form is provided for those
TRUE shareholders who may wish to designate a proxy to vote on their behalf during the meeting.
2. Equitable Treatment of Shareholders
As a publicly listed company, TRUEûs shareholder base is large and diverse. TRUE recognizes the importance of
keeping every shareholder timely, accurately and appropriately informed. Important information is posted promptly on the
investor relations pages of TRUEûs web site, accessible via www.truecorp.co.th and www.true-corp.com, so that it reaches
all shareholders, whether they are a significant or a minority shareholder and wherever located, at the same time.
Credible
çWe communicate with integrity, always keeping the best interest of the company in mind.é
TRUEûs corporate web site gives the public a wealth of information about the company, its people and its performance.
Copies of minutes of meetings, investor presentations, past annual reports and filings with the Stock Exchange of Thailand
are just a part of the resources available 24/7/365 in both English and in Thai. Financial information dating back to 1999 is
available for downloading or by contacting TRUEûs Investor Relations department.
The Investor Relations department and the Corporate Secretary of TRUE each bear important responsibilities to TRUEûs
shareholders. Together, they are TRUEûs contact points with its shareholders. Corporate information to the general public and
shareholders flows through the Investor Relations department, whereas information to the general public and our regulators
is channeled through the Corporate Secretary.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 29
Maintaining TRUEûs credibility is essential for gaining the investor confidence that is necessary to maximize and sustain
the value of the company and the wealth of TRUEûs shareholders. Analysts from Thailandûs major securities firms track TRUE
and, therefore, the Investor Relations department works cooperatively with these analysts. These analystsû reports lead to an
open discussion of TRUEûs operations and financial prospects, and are accessible by the general public and by TRUEûs
shareholders.
In 2004, TRUE increased its equity interest in its subsidiary, TA Orange. As assurance that the terms of the transaction
were çfairé to TRUEûs shareholders, çfairness opinionsé were given by BT Securities Company Limited. The transaction was
completed while providing utmost transparency for the benefit of all shareholders.
3. The Role of Stakeholders
The continued success of TRUE relies upon the ability of stakeholders to influence positively TRUEûs conduct and
activities, and vice-versa.
Caring
çWe are dedicated to working together in harmony to do whatûs right for our customers, colleagues and partners.é
TRUEûs Code of Conduct defines the term çstakeholdersé to include customers, shareholders, creditors, employees
and their families, the government, business partners, business competitors and the citizens of Thailand. The Code of
Conduct is a roadmap that provides clear direction to Directors, management and employees alike, of TRUE and of TRUE
affiliates, towards melding the 4 Cs into the corporate culture.
The Code of Conduct encourages all to make a positive contribution to Thai society and to the well-being of Thai
people. The year 2004 continued TRUEûs position as a corporate and community leader in enriching and providing assistance
for the well being of Thai society.
ë TRUE and the TRUE affiliates provided immediate assistance to the victims of the December 26th tsunami, and relief
for their families and friends. TA Orange provided free of charge calls to those in the tsunami-affected areas, allowing
them to contact loved ones. Within a day or so, food, clothing and materials donated by employees had reached the
victims.
ë Now in service to the nation for more than 10 years, TRUEûs Nature Classroom, Arts and Culture Classroom
and Science Classroom are programs that aim to foster self-improvement and are designed to help students gain
knowledge and insight from the classrooms, adding valuable and enriching experiences to their lives.
30 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
ë Pirab Noi invites students studying mass communications in Thailandûs universities to participate in the production of
high quality content, while also promoting responsibility and ethics in the area of communications/journalism.
ë TRUE works closely with the Bangkok Metropolitan Administration (BMA), Education Department to guide Thailand
towards becoming a çknowledge-based society.é Through collaborative efforts, the çInternet for a Knowledge-Based
Societyé program has connected more than 300 schools in Bangkok to resources they never had access to before.
TRUE believes if young people have access to the latest information from around the world via the Internet, then they
will be empowered to explore new boundaries and improve their lives. This, in turn, will enable them to make even
more valued contributions for the benefit of the country.
TRUE understands that it has a responsibility to safeguard the interests of its stakeholders. As it has for many years,
TRUE has kept an open and cooperative working dialogue with Marsh UK Ltd., which is the insurance advisor to TRUEûs
secured creditors. In addition, last year TRUE and its insurance broker procured a competitive, comprehensive, secure a
cost-effective insurance package for TRUE and its affiliated companies. There is also a strong national interest in TRUEûs
ability to continue business operations even in the event of a significant accident or disaster. TRUE continues to make
investments and to allocate resources to ensure that its key services have adequate backups and will continue to operate
under virtually any circumstances.
Internal safeguards are implemented under the management of TRUEûs Audit Department. The effectiveness of the
Audit Department oversight and internal controls is enhanced through utilization of the expertise of PricewaterhouseCoopers
Risk Management Services Limited.
4. Disclosure and Transparency
Through its own initiative, over four years ago the Board established a committee to enhance the governance of the
company by adopting international best practices. Three years ago the Corporate Governance Guidelines were placed into
practice. A complete copy of the Corporate Governance Guidelines is available on TRUEûs website.The Guidelines
encompass:
ë Duties and responsibilities of the Board of Directors
ë Composition and selection of the Board of Directors
ë Board structure and procedure
ë Board Leadership
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 31
ë Board relationship to management
ë Meeting procedures
ë Committees of the Board of Directors
ë General Committee Matters
ë Policy regard related party transactions and Code of Conduct
Courageous
çWe recognize that with opportunity comes accountability and with accountability, ownership.é
Adoption of the Corporate Governance Guidelines led to the formation of a new Board Committee, the Independent
Committee. The work of the Independent Committee includes oversight responsibility over any Board matter involving a
related party transaction or a corporate opportunity, as well as all matters that are covered by the Stock Exchange of
Thailandûs Rules and Procedures and Disclosure of Connected Transactions of Listed Companies. Details of Connected
Transactions that occurred during 2004 are provided in the çConnected Transactionsé section of this Annual Report for 2004.
TRUE has its own complementary standards for transactions with related entities, which are stated in the Policy
Regarding Related Party Transactions. Situations such as trading on insider information and having a personal relationship in
matters involving TRUE are explained and explored in detail in the Code of Conduct that every employee is asked to read
and acknowledge.
5. Board Responsibilities
TRUE stakeholders are served by 20 hard-working persons, each of whom is able to work with colleagues as one and
yet who can complement the value of the Board with his own particular strengths.
Creative
çWe share our ideas with each other to create strong synergies.é
The schedule of the Board meetings for the coming year is set by consensus at the final Board meeting of the prior year
and written notice of each meeting is provided to each Director in accordance with all applicable rules and regulations.
32 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
In 2004, 8 Board meetings were held. Director attendance at those meetings was as follows:
No.
Directors
1
Mr. Narong Srisa-an
2
Mr. Vitthya
Vejjajiva
3
Dr. Kosol
Petchsuwan
4
Mr. Joti
Bhokavanij
5
Mr. Dhanin Chearavanont
6
Mr. Sumet
Jiaravanon
7
Dr. Ajva
Taulananda
8
Mr. Chaleo Souvannakitti
9
Mr. Athueck Asvanund
10
Mr. Supachai Chearavanont
11
Mr. Soopakij Chearavanont
12
Mr. Chatchaval Jiaravanon
13
Mr. Vichaow Rakphongphairoj
14
Mr. Umroong Sanphasitvong
15
Mr. Heinrich Heims
16
Mr. Klaus
Tuengeler
17
Mr. Claus
Stadler
18
Mr. Andreas Klocke
19
Mr. Harald
Link
20
Dr. Lee G.
Lam
* Resident outside of Thailand
Attendance / Number of Meetings (times)
7/8
7/8
8/8
8/8
5/8
0/8*
8/8
8/8
8/8
7/8
3/8
5/8
8/8
8/8
3/8
6/8
2/8
5/8
4/8
3/8
Individual strengths are utilized, and efficiency is achieved, by the delegation of 5 key Board responsibilities to these
standing committees:
- Audit Committee
- Finance Committee
- Corporate Governance Committee
- Compensation and Nominating Committee
- Independent Committee
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 33
Further detail on each Board committee and their committee members, including copies of their respective committee
charters, can be obtained from the investor relations pages of TRUEûs website.
The current number and allocation of seats on the Board reflect a fair proportion of each shareholder groupûs
investment. Non-executive directors remain a majority of TRUEûs Board, keeping the balance of power with non-executives
and ensuring decision-making independence and credible oversight of management. The seat of Chairman of the Board
remains with a non-executive director.
In order to maximize the value to TRUE of the knowledge and experience of each Director, TRUE does not limit the
number of times that a Director may be re-elected or impose a mandatory retirement age.
Compensation of the top executives and the Board is recommended by the Compensation and Nominating Committee
and approved by the entire Board. Remuneration consists of a fixed salary and, when deemed appropriate, a variable
component. The variable component is linked to individual and corporate performance. TRUEûs shareholders have approved
the remuneration presently paid to Board members. Key members of executive Management have also been provided, with
approval of the Companyûs shareholders, Stock Options (which utilized the services of an independent advisor in performing
this function, particularly within Thailandûs telecommunication industry) as a key component of their compensation in order to
link their compensation to corporate performance and to establish a long term performance incentive. Details of such
remuneration are provided within the Management content of the annual report.
TRUE has disclosed publicly in filings made with the Stock Exchange of Thailand significant actions taken by its Board
over the course of 2004.
34 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
True Corporation is the most fully integrated nationwide communications solutions provider in Thailand and one of the
countryûs largest brands.
Since being established in 1990 to build and jointly operate 2.6 million fixed lines in the Bangkok Metropolitan Area
(BMA) under a 25-year concession, it has grown rapidly to meet the lifestyle needs of Thai consumers.
Backed by Asiaûs largest agro-conglomerate, the Charoen Pokphand Group (with a 39.22 percent shareholding), Trueûs
subsidiary businesses currently include cellular operator TA Orange, Asia Wireless Communication (operator of WE PCT), True
Multimedia, True Internet and pay TV operator United Broadcasting Corporation (UBC).
Through these companies True provides home consumers, small and medium enterprises and corporates with the full
range of cellular, wireless and wireline, Internet, data and entertainment products and services in customized packages.
It is firmly established as the BMAûs leading wireline service provider with 56 percent market share, is the countryûs
largest Broadband provider with more than 85 percent market share, and the countryûs leading Internet Service Provider. In
TA Orange, True owns the fastest growing and third largest mobile operator.
The Company was listed (as TelecomAsia Corporation Public Company Limited) on the Stock Exchange of Thailand in
December 1993 with the security symbol çTAé. At this time it had an annual turnover of Baht 2 bil ion and employed 1,500 staff.
At the end of December 2004, the True Group (which rebranded and adopted the çTRUEé security symbol in April 2004)
had an annual group turnover of more than Baht 40 billion (including 100 percent of TA Orange and UBC), a market
capitalization of Baht 33.1 bil ion, infrastructure investments of more than Baht 100 bil ion and employed more than 8,000 staff.
Key Developments in 2004
December 2004
TA Orange achieved 3.4 million subscriber base, exceeding its target.
True strengthens its balance sheet, significantly reduces debt and increases
equity by Baht 2.7 billion. It achieved this by selling 398 million new ordinary
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 35
shares at Baht 6.8 per share via a seven-time oversubscribed private placement in
Thailandûs first Accelerated Global Tender.
Funds raised were used to complete debt restructuring of a subsidiary with a
creditor, enabling the True Group, excluding TA Orange, to reduce debt by
approximately Baht 9.3 billion in 2004 including a Baht 2.7 billion gain from debt
forgiveness from the debt restructuring.
November 2004
True becomes Thailandûs largest Internet Service Provider with more than one
million customers.
October 2004
True announces that in cooperation with UBC it wil launch Thailandûs first Broadband
TV service.
September 2004
True completes negotiations on long term debt financing for TA Orange,
enabling it to increase its shareholding in TA Orange to 83 percent.
NC True online game company is formed in a joint venture with Koreaûs NCsoft
to market the hugely popular Lineage II game in Thailand.
August 2004
True announces it will inject Baht 6 billion into TA Orange so the mobile operator
can expand network capacity and coverage to approximately 90 percent of
Thailandûs population.
June 2004
True raises Baht 2.4 billion by issuing seven year maturity Thai Baht debentures.
The funds are used to refinance debt to German creditor Kreditanstalt Für
Wiederaufbau (KfW).
May 2004
TA Orangeûs network quality is judged çBest in Bangkoké by a Synovate and
King Mongkutûs Institute survey.
April 2004
True launches the çAll Together Bonusé campaign which provides True telephone,
WE PCT and Internet users with the equivalent free TA Orange talk time
for every baht they spend on True services.
TelecomAsia changes its name to True as part of an çinside outé rebranding to
position the company for strong future growth.
36 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
ë True named çBest Competitive Carrieré in Telecom Asia Magazine 2004 Awards
The first time a Thai company has won an award in the seven years of this prestigious competition.
ë Disclosure Award for Good Corporate Governance
True has been included in the top quartile of listed Thai companies, ranked according to good corporate governance
practices, for two consecutive years.
The ranking was based on surveys implemented by the Thai Institute of Directors with the support of the SET and
the SEC.
ë Technology Fast 500 Asia Pacific Company Awards
True has been listed among Deloitteûs 2004 Technology Fast 500 Asia Pacific ranking for the fastest growing
companies.
ë Super Brand 2004
True was voted by consumers as a Thailand Superbrand in the Readerûs Digest Asia Superbrands Survey 2004.
In addition, in 2002 True won the Euromoney Award for Good Corporate Governance and in 2000 was ranked among
the top 10 leading Thai companies by Far Eastern Economic Review magazine.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 37
Revenues breakdown by business group
Percentage
31st December
of Shares
2004
Held by
Baht
the Company Million
%
Business Group/Operation by
31st December
2003
Baht
Million %
31st December
2002
Baht
%
Million
1. Fixed line and Value Added Service1
True Corporation Public Company Limited
Revenues
16,632
50.4
16,893
60.4
16,125
62.5
11,730
35.5
7,228
25.9
6,096
23.6
1,408
4.3
1,097
3.9
954
3.7
1,029
3.1
1,183
4.2
1,199
4.7
887
2.7
471
1.7
198
0.8
1,324
4.0
1,078
3.9
1,203
4.7
33,010
100.0
27,950
100.0
25,775
100.0
2. Wireless
Wire & Wireless Company Limited
Asia Wireless Communication Company Limited
Bangkok Inter Teletech Company Limited
Revenues
87.50
99.99
82.86
3. Multimedia Network and Broadband
True Multimedia Company Limited
90.45
Revenues
4. Data Service
True Corporation Public Company Limited
True Multimedia Company Limited
90.45
Revenues
5. Internet
True Internet Company Limited
Asia Infonet Company Limited
True Digital Entertainment Company Limited
True Internet Data Center Company Limited
Revenues
99.99
65.00
99.99
70.00
6. Other Business
True Fleet Management Company Limited
True Properties Company Limited
Wire & Wireless Company Limited
Other Companies
99.99
99.99
87.50
Revenues
Total Revenues
Source: The Company
1 Includes Fault Reporting and Dropwiring, Public Phone and Audiotext
38 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
True Corporation Public Company Limited, with the security symbol çTRUEé on the Stock Exchange of Thailand was
established on 13th November 1990 initially under the name of CP Telecommunication Co., Ltd. with a registered capital of
Baht 1,000 million to undertake Thailandûs major telecommunication infrastructures project and registered as a public
company limited with registration no. Bor Mor Jor 82 on 11th February 1993.
As at 31st December 2004, the Companyûs registered capital was Baht 46,583,393,190.- consisting of 3,958,873,833
common shares with a par value of Baht 10 per share and 699,465,486 preference shares with a par value of Baht 10 per
share, of which Baht 40,925,272,140.- is paid-up capital, comprising of 3,393,061,728 common shares with a par value of
Baht 10 per share and 699,465,486 preference shares with a par value of Baht 10 per share.
The Companyûs head office is located at:
18 True Tower Ratchadaphisek Road
Huai Khwang, Bangkok 10310
Telephone : (662) 643-1111
Fax
: (662) 643-1651
Website : www.truecorp.co.th
The Companyûs subsidiaries, associates companies and other investments are as follows:
Company Name
Address
Type of Business
Paid-up Capital
Asia DBS Public Company Limited
18 True Tower
DBS system operator THB 100 million
Ratchadaphisek Road
Huai Khwang, Bangkok 10310
True Multimedia Co., Ltd
(Formerly named Asia Multimedia
Company Limited)
18 True Tower
NON-POTS and
Ratchadaphisek Road
multimedia services
Huai Khwang, Bangkok 10310
THB 6,127 million
Asia Wireless Communication
Company Limited
18 True Tower
PCT operator
Ratchadaphisek Road
Huai Khwang, Bangkok 10310
THB 5,797.85 million
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 39
Company Name
Address
Type of Business
Paid-up Capital
Bangkok Inter Teletech
Company Limited
986 U Chu Liang Building,
14th Floors, Unit D,
Rama IV Road, Silom,
Bangrak, Bangkok
Investment in
Cellular Operator
THB 21,000 million
TA Orange Company Limited
986 U Chu Liang Building,
4th-5th, 11th-15th Floors,
Rama IV Road, Silom,
Bangrak, Bangkok
1,800 MHz cellular
telephone operator
THB 27,100.10 million
TA Orange Retail Company Limited
986 U Chu Liang Building,
14th Floors, Unit D3
Rama IV Road, Silom,
Bangrak, Bangkok
Retail services
THB 1 million
Song Duo Company Limited
986 U Chu Liang Building,
14th Floors, Unit D2
Rama IV Road, Silom,
Bangrak, Bangkok
Inactive
THB 1 million
K.I.N. (Thailand) Company Limited
18 True Tower
Holding Company
Ratchadaphisek Road
Huai Khwang, Bangkok 10310
THB 75 million
True Properties Company Limited
(Formerly named Nilubon
Company Limited)
18 True Tower
Rental services
Ratchadaphisek Road,
Huai Khwang, Bangkok 10310
THB 3,488 million
Tele Engineering and Services
Company Limitedå
18 True Tower
Construction and
Ratchadaphisek Road
distributor
Huai Khwang Bangkok 10310
THB 25 million
40 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Company Name
Address
Type of Business
Telecom Equipment
Manufacturing Company Limited
18 True Tower
Telecom equipment
Ratchadaphisek Road
manufacturer
Huai Khwang Bangkok 10310
Telecom Holding Company Limited
18 True Tower
Holding Company
Ratchadaphisek Road
Huai Khwang Bangkok 10310
Paid-up Capital
THB 24 million
THB 16,589.25 million
Telecom International Company Limited 18 True Tower
Holding Company
Ratchadaphisek Road
Huai Khwang Bangkok 10310
THB 300 million
Telecom Training and
Development Company Limited
18 True Tower
Training service
Ratchadaphisek Road
Huai Khwang, Bangkok 10310
THB 50 million
True Digital Entertainment
Company Limited
1 Fortune Tower, 25th Floor
Ratchadaphisek Road
Din Dang, Bangkok 10400
Online game
THB 73.5 million
True Internet Company Limited
(Formerly named Asianet
Corporation Company Limited)
1 Fortune Tower, 14th,27th Floor
Ratchadaphisek Road
Din Dang, Bangkok 10400
Audio text services
and internet dealer
THB 236.40 million
T-Pay Company Limited
18 True Tower
Payment
Ratchadaphisek Road
service center
Huai Khwang, Bangkok 10310
THB 30 million
U-Net Company Limited
18 True Tower
Construction and
Ratchadaphisek Road
distributor
Huai Khwang, Bangkok 10310
THB 93 million
Wire & Wireless Company Limited
54 W&W Bld., Pattanakarn 20 Construction and
Suanluang Bangkok
distributor
THB 100 million
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 41
Company Name
Asia Remanufacturing Industries
Company Limited
Address
102,15th Floor,
Na Ranong Road,
Klongtoey, Bangkok
Type of Business
Modification, repair
and maintenance
services
True Fleet Management
18 True Tower
Rental services
Company Limited (Formerly named
Ratchadaphisek Road
W7 Rental Services Company Limited) Huai Khwang, Bangkok 10310
Paid-up Capital
THB 5.6 million
THB 150 million
Yai Kaew Company Limited
18 True Tower
Investment in property THB 10 million
Ratchadaphisek Road
Huai Khwang, Bangkok 10310
K.I.N. (Thailand) Company Limited
(Foreign Company)
P.O. Box 957,
Holding Company
Offshore Incorporation Centre,
Road Town, Tortola,
British Virgin Island
USD 1
Nilubon Company Limited
(Foreign Company)
P.O. Box 71,
Holding Company
Craigmuir Chambers, Road Town,
Tortola, British Virgin Island
USD 1
TA Orient Telecom
Investment Company Limited
3/F, Hing Yip Commercial
Centre, 272 Des Voeus
Road C., Hong Kong
HK$ 117 million
Telecom Asia (China)
Company Limited
P.O. Box 957,
Commercial
Offshore Incorporation Centre,
Road Town, Tortola,
British Virgin Island
HK$ 78
Telecom International China
Company Limited
P.O. Box 71,
Craigmuir Chambers,
Road Town,Tortola,
British Virgin Island
HK$ 78
Holding Company
Commercial
42 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Company Name
Address
Type of Business
Paid-up Capital
Chongqing Communication
Equipment Co., Ltd.
140 Daping Zhengjie Chongqing Telecommunication
RMB 292 million
Peopleûs Republic of China
equipment manufacturer
Asia Infonet Company Limited
1 Fortune Town Bldg., 14th,
Internet service
17th Floor Ratchadaphisek Road provider
Huai Khwang, Bangkok 10310
THB 15 million
True Internet Data Center
18 True Tower, 14th Floor
Internet Data Center
Company Limited (Formerly named TA Ratchadaphisek Road
Internet Data Center Company Limited) Huai Khwang, Bangkok 10310
THB 115.02 million
United Broadcasting Corporation
Public Company Limited
118/1 Tipco Building
Rama 6 Road,
Phayathai, Bangkok
THB 9,704.05 million
NC True Company Limited
Developer and service THB 125.5 million
18 True Tower, 18th Floor
Ratchadaphisek Road
provider of online game
Huai Khwang, Bangkok 10310
N.T.U. (Thailand) Company Limited
518/5 Maneeya Center Building, Telecommunication
7th Floor, Ploenchit Road,
Lumpinee, Pathumwan, Bangkok
THB 12 million
Thai Smart Card Company Limited
191 Silom Complex Building
27th Floor, Room No. 2,
Silom Road, Bangrak, Bangkok
THB 395 million
NEC Corporation (Thailand)
Company Limited
Telecommunication
THB 343 million
159 Sermmit Tower 2nd,
equipment manufacturer
24th Floor, Sukumvit 21
Klongtoeynua Wattana Bangkok
Pay Television
Central Service
Bureau for clearing
electronic payment
transactions
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 43
References
Registrar
Auditor
Debenture Registrar/
Debentureholdersû
Representative
Legal Counsel
: Thailand Securities Depository Co.,Ltd
62 Stock Exchange of Thailand Building, 4, 6, 7/F
Ratchadaphisek Road, Klong Toey Bangkok 10110
Telephone : (662) 229-2800, (662) 654-5599
Fax
: (662) 359-1262-63
: Mr. Kajornkiet Aroonpirodkul
(CPA Registration No. 3445) and/or
Mrs. Nattaporn Phan-Udom (CPA Registration No. 3430)
and/or Mr. Boonmee Ngotngamwong
(CPA Registration No. 3673)
PriceWaterhouseCoopers ABAS Ltd.
15th Floor, Bangkok City Tower 179/74-80
South Sathorn Road, Sathorn Bangkok 10120
Telephone : (662) 286-9999, (662) 344-1000
Fax
: (662) 286-5050
: Thai Military Bank Public Company Limited
393 Silom Road, Bangrak, Bangkok 10500
Telephone : (662) 233-9160-79
(662) 230-5000
Fax
: (662) 236-7939
: Siam Premier International Law Office Limited
24th - 26th Floors, Thai Wah Tower 2
21/147 -150 South Sathon Road
Bangkok 10120
Telephone : (662) 679-1333
Fax
: (662) 679-1314
Website
: www.siamlaw.co.th
44 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 45
While True sees many opportunities to grow in 2005, there are a number of general and specific factors that could
impact the companyûs performance and that of its subsidiaries.
Industry Risks
True and its subsidiaries, particularly TA Orange and its Internet and Broadband businesses, face increasing competition
from cellular operators, TOT and new ISP market entrants. As a result, the tariff for mobile phone calls and Broadband
service has fallen steadily over the past year, which has had, and will continue to have, an impact on operational results.
We expect competition to remain intense in the future, but believe True is well positioned to meet this given its
leadership position in the Internet/Broadband market and TA Orangeûs strong 2004 revenue growth and expanding customer
base. In addition, rapid technological change could also adversely affect the viability of Trueûs business and make its own
technology less competitive. However, at the time of writing no such new technology has been identified as a major current
or imminent business threat.
Regulatory and Liberalization Risks
True and its subsidiaries operate under a number of concessions granted by TOT Corporation Public Company Limited
and CAT Telecom Public Company Limited. A dispute with either TOT or CAT over compliance with a concession agreement
could affect Trueûs ability to conduct business. This concession could be cancelled by TOT if True violates laws relating to
public or national security, the Company is placed under receivership by a court in a bankruptcy case, or it willfully and
continually breaches a concession agreement in any material respect. However, TOT must submit the case to the Arbitration
Tribunal for adjudication before it can cancel the concession agreement with True.
Under revenue sharing provisions of Trueûs fixed line concession, TOT collects all of Trueûs fixed line revenues and retains
a portion for the revenue sharing. TOT may withhold or delay payments from revenues collected for True to offset any
obligations it believes it is owed (although this has not occurred to date).
46 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
As well as being Trueûs concession granter, TOT is also a competitor in the BMA fixed line market. This has and could
continue to lead to disputes between True and TOT, which can deny or put on hold Trueûs requests to launch new services.
TOT and True have brought some disputes to the Administrative Court and the Arbitration Tribunal for adjudication.
In August 2002 True asked the Arbitration Tribunal for compensation from TOT for access charge revenues TOT
generated using Trueûs network. In August 2004, True asked the Arbitration Tribunal for compensation from TOT for sharing
on revenues generated from additional public phones apart from the first 20,000 sets. In January 2005, True also asked the
Arbitration Tribunal to ensure TOT shared revenues from incoming international calls based on the rate indicated in the
concession.
In July 2004 TOT asked the Arbitration Tribunal to require True to pay advertising cost for placing Trueûs logo on
Payphone booths. And in December 2004, TOT also sought costs for placing the True logo on invoices and receipts.
The pending liberalization of the Thai telecommunications industry is expected to reduce or eliminate these conflicts of
interest, but proposed initiatives could put True at a disadvantage to competitors. It is also possible that certain policies to
be imposed by the National Telecommunications Committee may affect Trueûs operating costs and/or increase
competition in the sectors in which it operates.
Risks Related to Financial Situation
Trueûs operation is restricted by a number of debt and other financial agreements. These agreements could prohibit True
from exploiting good business opportunities or lead to accelerated debt repayment if TOT cancels the concession agreement
with the Company. However, TOT must seek an arbitration decision in order to cancel the concession agreement.
True is subject to exchange rate fluctuations, which could increase interest payments. True had total debt of Baht 84
billion as at December 31, 2004, with 13 percent of this being denominated in foreign currencies (Japanese Yen and US
Dollar). In 2004, the Company had consolidated capital expenditure of approximately Baht 4.0 bil ion, approximately 40 percent of
which was in foreign currencies. The Company has put in place hedging tools to reduce its exposure to exchange rate
fluctuations, primarily for the majority portion of a USD 170 million loan belonging to a subsidiary.
Out of the Companyûs total debt, about 50 percent is subject to floating interest rates and vulnerable to rate increases.
All TA Orange debt, accounting for approximately 37 percent of total consolidated debt, is subject to floating rates. However,
TA Orange debt interest rates will step down over time if it is able to achieve conditions set out in its loan agreement.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 47
Shareholders
True Corporation Public Company Limited
Major Shareholders1
(as of 30th December 2004)
Name
1. CP GROUP2
2. THAILAND SECURITIES DEPOSITORY COMPANY
LIMITED FOR DEPOSITORS (FOREIGN)
3. THAILAND SECURITIES DEPOSITORY COMPANY LIMITED
FOR DEPOSITORS (THAI)
4. THAI TRUST FUND
5. KREDITANSTALT FÜR WIEDERAUFBAU (çKfWé)
6. MR. JATURONG JATUPARISUTHI
7. MR. SOONTHORN ARUNANONCHAI
8. MISS PIMRA INTHARAVITTAYANUN
9. MR. CHALEO SOUVANNAKITTI
10. VATCHARAPOL CO., LTD.
No. of Shares
(Million Shares)
1,605.14
1,240.97
% of Total
Issued Shares
39.22
30.32
468.91
11.46
357.99
341.47
11.08
5.00
4.50
3.50
3.00
8.75
8.34
0.27
0.12
0.11
0.08
0.07
Remark : 1Including common shares and preferred shares
2
There are Charoen Pokphand Group Co., Ltd. and its related persons namely, Bangkok Telecom Holding Company Limited, Charoen Pokphand Foods Public
Company Limited, Bangkok Produce Merchandising Public Company Limited, Bangkok Agro-Industrial Products Public Company Limited, Charoen Pokphand
Northeastern Public Company Limited, Kasetphand Industry Company Limited, Charoen Pokphand Enterprise Company Limited, Unigue Network Company
Limited, Wide Broad Cast Company Limited, C.P. Interfood (Thailand) Company Limited, Star Marketing Company Limited, Advance Pharma Company Limited and
Golden Tower Trading Limited.
48 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
The Company has not paid or declared any dividends on its issued shares since operation commencement. The
Company can pay dividends only out of its profits after deducting its cumulative losses, and only if it has set aside as a legal
reserve. The Companyûs restructuring agreement also limits its ability to pay dividends until all of its indebtedness is repaid
in full.
The Companyûs principal shareholders have entered into a shareholdersû agreement under which they agreed to vote for
and cause their representatives appointed to the Companyûs Board of Directors to declare an annual dividend equal to at
least 50% of its net profits for that year, after statutory reserves and subject to availability of cash, the regulations of the SET,
and its credit facilities. Before dividends can be paid to holders of its ordinary shares, however, dividend payments on
preferred shares must be paid in full. Within March 31, 2008, the eighth anniversary from the date its preferred shares were
issued, the Companyûs preferred shareholders are entitled to receive cumulative dividends at the rate of Baht 1 per share per
fiscal year. After March 31, 2008, holders of our preferred shares are entitled to a non-cumulative dividend at the rate of Baht
0.01 per share per fiscal year. The right to receive cumulative dividends for any fiscal year in which the payment of those
dividends was not declared ceases once a holder converts its preferred shares into ordinary shares.
For dividend policy of subsidiary company, each subsidiary companyûs Board of Directors will consider the payment of
dividends from the balance of cash flows compare with capital investment of individually subsidiary company. Subject to the
availability of cash flows of subsidiary company and only if it has set aside as a legal reserve, each Board of Directors of
individually subsidiary company shall consider the payment of dividends just in case.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 49
Management
Management Structure of the Company consists of the Board of Directors, the Committees and the executive officers,
details of which are as follows:
Board of Directors
As of 31st December 2004, the Board of Directors comprises of 20 directors who are (a) Executive Directors
(b) Non-Executive Directors including directors representing the creditors, and (c) Independent Directors means a director who is
independent from a major shareholder or a group of major shareholders and having the qualification as follows:- not being an employee or a staff member or an advisor who receives a regular salary or any other benefit from the
Company, an affiliated company, associated company or a related company
- not holding shares exceeding 0.5 percent, including shares held by a related person, of paid-up capital of the
Company or an affiliated company, associated company or a related company
- the ability to take care of the interest of all shareholders equally
- the ability to prevent conflict of interest among the Company and its management, major shareholders or other
companies which have the same group of management or major shareholders as the Company
The Board of Directors of the Company is as follows:
1.
2.
Mr. Narong
Mr. Vitthya
Name
Srisa-an
Vejjajiva
3.
Dr. Kosol
Petchsuwan
4.
Mr. Joti
Bhokavanij
5.
6.
7.
8.
9.
10.
Mr. Dhanin
Mr. Sumet
Dr. Ajva
Mr. Chaleo
Mr. Athueck
Mr. Supachai
Chearavanont
Jiaravanon
Taulananda
Souvannakitti
Asvanund
Chearavanont
11.
12.
Mr. Soopakij Chearavanont
Mr. Chatchaval Jiaravanon
13.
Mr. Vichaow
Rakphongphairoj
Position
Independent Director
Independent Director and
Chairman of the Audit Committee
Independent Director and
Member of the Audit Committee
Independent Director and
Member of the Audit Committee
Chairman
Vice Chairman
Vice Chairman
Vice Chairman
Vice Chairman and Group General Counsel
Director, President and
Chief Executive Officer
Director
Director and Managing Director-Group
Investment
Director, Managing Director and
Chief Operating Officer
50 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
14.
15.
16.
17.
18.
19.
20.
Mr. Umroong
Mr. Heinrich
Mr. Klaus
Mr. Claus
Mr. Andreas
Mr. Harald
Dr. Lee G.
Sanphasitvong
Heims
Tuengeler
Stadler
Klocke
Link
Lam
Position
Director
Director
Director
Director
Director
Director
Director
Remark :
Additional information related to the Companyûs Board of Directors is as follows:
a) History of Offence
: none
b) Debt owed to the Company or its Subsidiaries
: none
c) Material Connected Transactions
: none
Mr. Narong Srisa-an, Dr. Kosol Petchsuwan and Mr. Joti Bhokavani has already taken çDirectors Accreditation Programé
(DAP) from Thai Institute of Directors Association (IOD)
Mr. Vitthya Vejjajiva, Dr. Kosol Petchsuwan and Mr. Joti Bhakavanij has already taken çChairman 2000é
from Thai Institute of Directors Association (IOD)
Authority and Responsibility of the Board of Directors
The Board of Directors is granted the authority and duty to manage the Company in compliance with the objectives
and articles of association of the Company and the resolutions of the shareholders meetings. With regard to the management
of the Company, the Board of Directors has authority to make any decision related to the Companyûs regular operation
except for the matter required the approval of the shareholders meeting as specified by law. In addition, the Board of
Directors may grant the authorization to one director or more or any other person to perform any acts on its behalf, however,
any decision on major operations such as major investment and major procurement of loan, the management team shall
propose the said transactions to the Board of Directors for approval.
Authorized Directors
Mr. Supachai Chearavanont or Mr. Vichaow Rakphongphairoj jointly sign with Mr. Athueck Asvanund or Mr. Soopakij
Chearavanont or Mr. Chatchaval Jiaravanon to with the Companyûs seal affixed, execute any act, thing or legal action
whatsoever on the Companyûs behalf.
Appointment of Directors
The Compensation and Nominating Committee assists the Board of Directors in reviewing and proposing the compensation
and nominating directors of the Company prior to proposing to the Companyûs shareholders meeting for final approval.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 51
With regard to the right of shareholders to appoint directors, each shareholder shall appoint the directors by a majority
vote. All Shareholders have the rights to appoint directors. Each shareholder shall have one right to vote per one share and
shall appoint one director or more, provided that he cannot divide his votes to any person to any extent.
In selecting an independent director, the Company will take into account of the prospectûs qualifications that required
by the Stock Exchange of Thailand together with the background and experiences appropriate for the Company business
prior to proposing the nomination of the prospect to the Compensation and Nominating Committee and the Board of
Directors for further approval.
Audit Committee
As of 31st December 2004, the Audit Committee of the Company consists of 3 persons as follows:
1. Mr. Vitthya
2. Dr. Kosol
3. Mr. Joti
Vejjajiva
Petchsuwan
Bhokavanij
Chairman of the Audit Committee
Member of the Audit Committee
Member of the Audit Committee
The scope of duty and responsibility of the Audit Committee is as follows:
1. To review the Companyûs financial reports to ensure accuracy and adequate information for public disclosure;
2. To ensure the appropriateness and effectiveness of internal control system and internal auditing system of the
Company;
3. To consider and propose the appointment and remuneration of an external auditor of the Company;
4. To regularly review the practice of the Company to ensure the compliance with the regulations of the Securities and
Exchange Act, Rules and Regulations of the Stock Exchange of Thailand and related law and regulations;
5. To review the disclosure of information of the Company to ensure the accuracy and adequacy of said information
in case that there is a connected transaction that may lead to a conflict of interest;
6. To prepare the Audit Committee Report on the Corporate Governance with the approval of the Chairman of the
Committee appeared therein to be disclosed in the annual report of the Company; and
7. To perform any other act as required by law or as delegated by the Board of Directors.
Independent Committee
The Independent Committee is responsible for reviewing and monitoring the entering into any connected transactions,
which may involve a conflict of interest with the Company. The Committee consists of the following members:
1. Mr. Narong
2. Mr. Joti
3. Mr. Klaus
Srisa-an
Bhokavanij
Tuengeler
Independent Director
Independent Director
KfW-nominated Director (with the alternate of Mr. Andreas Klocke
or Mr. Claus Stadler)
52 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
4. Mr. Supachai
5. Mr. Athueck
Chearavanont
Asvanund
CP-nominated Director
CP-nominated Director
In the case of any major shareholder having a conflict of interest, Directors nominated by the said shareholder will
abstain from the Independent Committee Meeting.
Compensation and Nominating Committee
The Compensation and Nominating Committee is responsible for determining the compensation and considering the
nomination of the directors of the Company. The committee consists of the following members:
1. Mr. Dhanin
2. Mr. Heinrich
3. Mr. Soopakij
4. Mr. Umroong
Chearavanont
Heims
Chearavanont
Sanphasitvong
Finance Committee
The Finance Committee assists the Company in reviewing and monitoring the financial management of the Company.
The committee consists of the following members:
1. Dr. Ajva
2. Mr. Chaleo
3. Mr. Heinrich
4. Mr. Umroong
Taulananda
Souvannakitti
Heims (alternates being Mr. Klaus Tuengeler or Mr. Andreas Klocke)
Sanphasitvong
Corporate Governance Committee
Corporate Governance Committee is responsible for setting policy on Corporate Governance of the Company.
The Committee consists of the following members:
1. Dr. Ajva
2. Mr. Vitthya
3. Mr. Claus
4. Mr. Athueck
5. Mr. Supachai
6. Mr. William E.
Taulanada
Vejjajiva
Stadler
Asvanund
Chearavanont
Harris
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 53
Executive Officers
As of 31st December 2004, the executive officers of the Company are as follows:
1. Mr. Supachai
Chearavanont
2. Mr. Vichaow
Rakphongphairoj
3. Mr. Chatchaval
Jiaravanon
4. Mr. Athueck
Asvanund
5. Mr. William E.
6. Mr. Thiti
Harris
Nantapatsiri
7. Mr. Adhiruth
Thothaveesansuk
8. Mr. Songtham
Phianpattanawit
Director, President and
Chief Executive Officer
Director, Managing Director and
Chief Operating Officer
Director and Managing Director-Group
Investment
Vice Chairman, Group General Counsel and
Acting Company Secretary
Chief Financial Officer
Managing Director
Home / Consumer Solution & Highspeed Access
Managing Director
Office / SME Solution & Wireless Access
Managing Director
Corporate Solution, Wholesales & Data
Remark:
1. Executive Officers mean Directors, President or persons with managerial authority who are among the top four
ranking individuals in the Company, after the President, and all other persons who occupy a position equivalent to
such a top four ranking individual.
2. Additional information related to the Companyûs Executive Officers is as follows:
a) History of Offence
: none
b) Debt owed to the Company or its Subsidiaries
: none
c) Material Connected Transactions
: none
Authority and Responsibility of the President
The President has the authority to supervise and carry on the Companyûs day-to-day business, and in case any matter/
transaction is important, the President will submit said matter/ transaction to the independent directors and/or the relevant
Committee (such as the Finance Committee, the Compensation and Nominating Committee or the Independent Committee)
and/or the Board of Directors, as the case may be, to approve said matter/ transaction. In addition, the President has no
authority to approve any matter/ transaction that he or the person who may have a conflict of interest or any other form of
conflict, which the Company or the Companyûs subsidiaries have or propose to enter into, with the Company or the
Companyûs subsidiaries. In such case, such matter/ transaction shall have to be approved by the independent directors and/
or the relevant Committee and/or the Board of Directors, as the case may be.
54 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Remuneration for the Companyûs Directors and the Executive Officers
(1) Remuneration of the Director
The 20 committee members are remunerated Baht 37.20 million for the Year 2004.
Details of Remuneration of each Director are as follows:
Chairman
Honorary Chairman
Vice Chairman
Director
Baht 300,000 per month
Baht 200,000 per month
Baht 150,000 per month
Baht 100,000 per month
In this connection, any director being the Companyûs employee shall receive the directorûs remuneration in addition to
his salary as employee.
Furthermore, Independent Directors who hold a position in the Committee, shall receive the remuneration as follows:
Independent Director who is also
Baht 300,000 per month
the Chairman of the Committee
Independent Director who is also
Baht 200,000 per month
a member in the Committee
Whereby the remuneration of the Independent Directors who are not the member in the Committee and directors who are
not the Independent Directors shall remain the same.
(2) Remuneration of the Executive Officers
The 8 executives at the top level received remuneration totaling Baht 96.05 million for the Year 2004 from January to
December, which included Baht 85.20 million for salary, Baht 6.94 million for bonus and Baht 3.90 million for provident fund.
(3) Other Compensation
(3.1) Employee Stock Option Plan 2004
(3.2) Employee Stock Option Plan 2003
(3.3) Employee Stock Option Plan 2002
(3.4) Employee Stock Option Plan 2000
(3.1) Employee Stock Option Plan 2004
The Extraordinary General Shareholders Meeting No. 2/2547 of the Company for the year 2004 held on 10th June
2004 has approved the issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to
certain Directors and employees at executive level totaling not exceeding 35 persons. Summary details are as follows:
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 55
Number of Warrants Issued and Outstanding
: 18,274,444 units
Date of Issuance
: 7th February 2005
Maturity
: 5 years from the issuance date
Date of Expiry
: 6th February 2010
Exercise Period
: Each Warrant Holder received 3 separate warrant certificates.
Each certificate represented 1/3 of the whole amount of
warrants allotted and shall be exercisable for subscribing
ordinary shares as follow:
The 1st Certificate: Warrant Holders shall be starting exercising
from 7th February 2006 until its expiration.
nd
The 2 Certificate: Warrant Holders shall be starting exercising
from 7th February 2007 until its expiration.
rd
The 3 Certificate: Warrant Holders shall be starting exercising
from 7th February 2008 until its expiration.
Exercise Ratio
: One unit of warrants entitles to purchase one ordinary
share at Baht 11.20
(3.2) Employee Stock Option Plan 2003
The Annual General Shareholders Meeting of the Company for the year 2003 held on April 11, 2003 has approved the
issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and
employees at executive level totaling not exceeding 35 persons. Summary details are as follows:
Number of Warrants Issued and Outstanding
(as at 28th February 2005)
: 18,097,664 units
Date of Issuance
: 17th June 2003
Maturity
: 5 years from the issuance date
Date of Expiry
: 16th June 2008
56 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Exercise Period
: Each Warrant Holder received 3 separate warrant certificates.
Each certificate represented 1/3 of the whole amount of
warrants allotted and shall be exercisable for subscribing
ordinary shares as follow:
The 1st Certificate: Warrant Holders shall be starting exercising
from 17th June 2004 until its expiration.
nd
The 2 Certificate: Warrant Holders shall be starting exercising
from 17th June 2005 until its expiration.
rd
The 3 Certificate: Warrant Holders shall be starting exercising
from 17th June 2006 until its expiration.
Exercise Ratio
: One unit of warrants entitles to purchase one ordinary
share at Baht 5.20
(3.3) Employee Stock Option Plan 2002
The Annual General Shareholders Meeting of the Company for the year 2002 held on April 12, 2002 has approved the
issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and
employees at executive level totaling not exceeding 35 persons. Summary details are as follows:
Number of Warrants Issued and Outstanding
: 37,131,597 units
Date of Issuance
: 14th June 2002
Maturity
: 5 years from the issuance date
Date of Expiry
: 13th June 2007
Exercise Period
: Each Warrant Holder received 3 separate warrant certificates.
Each certificate represented 1/3 of the whole amount of warrants
allotted and shall be exercisable for subscribing ordinary
shares as follow:
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 57
The 1st Certificate: Warrant Holders shall be starting exercising
from 14th June 2003 until its expiration.
nd
The 2 Certificate: Warrant Holders shall be starting exercising
from 14th June 2004 until its expiration.
rd
The 3 Certificate: Warrant Holders shall be starting exercising
from 14th June 2005 until its expiration.
Exercise Ratio
: One unit of warrants entitles to purchase one ordinary
share at Baht 10.60
(3.4)Employee Stock Option Plan 2000
The Annual General Shareholders Meeting of the Company for the year 2000 held on April 27, 2000 has approved the
issuance and offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and
employees at executive level totaling not exceeding 35 persons. Summary details are as follows:
Number of Warrants Issued and Outstanding
: 36,995,000 units
Date of Issuance
: 9th June 2000
Maturity
: 10 years from the issuance date
Date of Expiry
: 9th June 2010
Exercise Period
: (a) Warrant Type 1:
Each Warrant Holder received 3 separate warrant certificates.
Each certificate represented 1/3 of the whole amount of warrants
allotted and is exercisable for subscribing ordinary shares starting
from June 30, 2000, 2001 and 2002 respectively.
(b) Warrant Type 2:
Each Warrant Holder received 3 separate warrant certificates.
Each certificate represented 1/3 of the whole amount of warrants
allotted and is exercisable for subscribing ordinary shares starting
from December 31, 2000, 2001 and 2002 respectively.
Exercise Ratio
: One unit of warrants entitles to purchase one ordinary
share at Baht 10.60
58 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Details of Warrant-holding under ESOP Plan
Warrants under
ESOP 2004
Warrants under
ESOP 2003
Warrants under
ESOP 2002
Warrants under
ESOP 2000
Name
1. Dr. Ajva
Taulananda
2. Mr. Soopakij Chearavanont
3. Mr. Supachai Chearavanont
4. Mr. Vichaow Rakphongphairoj
5. Mr.Chatchaval Jiaravanon
6. Mr. Athueck Asvanund
7. Mr. William E. Harris
8. Mr. Adhiruth Thothaveesansuk
9. Mr. Thiti
Nantapatsiri
10. Mr. Songtham Phianpattanawit
No. of
No. of
% of
% of
warrants Project warrants Project
No. of
No. of
% of
% of
warrants Project warrants Project
----------2,434,077
1,277,890
1,277,890
1,331,136
1,277,890
1,277,890
1,277,890
1,277,890
-----------7,058,824
3,088,235
3,705,882
3,860,294
3,000,000
1,503,662
-----------
----------12.74
6.69
6.69
6.97
6.69
6.69
6.69
6.69
-----------3,696,402
1,617,176
1,940,611
2,021,470
1,297,838
850,404
-----------
----------18.61
8.14
9.77
10.18
6.53
4.28
-----------
----------19.01
8.32
9.98
10.40
8.08
4.05
-----------
2,240,000
4,130,000
6,510,000
2,800,000
4,130,000
5,320,000
945,000
----------------
6.06
11.16
17.60
7.57
11.16
14.38
2.55
----------------
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 59
Insider Trading Policy
The Company is currently in compliance with applicable laws to monitor and prevent the personal use of confidential
information of the Company by its management, including the use of said information for the purpose of insider trading.
Material information which has not yet been disclosed will be kept confidential but will be disclosed only to the relevant senior
management of the Company. The relevant senior management of the Company who shall access or receive said information
are required to report their trading of shares in the Company pursuant to the Regulations of the Office of the Securities and
Exchange Commission Regarding Rules, Conditions, and Procedures Governing the Preparation and Disclosure of Reports
on Securities Holdings, in order to prevent insider trading using internal information, and to ensure that the trading of shares
by çinsidersé of the Company is transparent.
In addition, the Company has been carrying on the comparative study of the insider trading policies of various foreign
institutions to be applied as a guideline to enhance transparency and boost the confidence in the Company amongst the
analyst and investor community.
Internal Controls
After an assessment of the Companyûs internal controls with the Audit Committee, the Board of Directors has an opinion
that the Companyûs internal controls are adequate and suitable. Moreover, the external auditor has an opinion that they/it did
not encounter any matter involving internal controls and its operation which are considered to be material weaknesses that
could have a material effect on the financial statements. The Board also emphasized the development of the Companyûs
Corporate Governance in order to improve the internal controls within the Company on a continuing basis.
Personnel
As of 31st December 2004, the total number of employees is as follows:
Work Group and Classification
Management
Service Area & Network Operation
Marketing & Sales
Information Technology
Customer Services
Finance & Accounting
Supporting
Total
Source : the Company
No. of Employees
82
2,273
425
242
799
230
286
4,337
60 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Remuneration for the Companyûs Employees
Remuneration
In 2004, the total remuneration for employees was approximately Baht 2,026.89 million which consists of wages, salaries,
bonus, overtime compensation, commission, provident fund and others. (please see details in the note 27 to the financial
statements)
Other Compensation & Benefits
Health Plans and Employee Welfare
- In-house clinic
- Annual Medical Check-up
- New Employeeûs Medical Check-up
- Group Health Insurance
- Group Accident Insurance
- Group life Insurance
- In case of death: Baht 30,000. - / Person
- Social Security Fund
- Each of the Company and employees contributes 5% of monthly salary (If any employeeûs salary is more than Baht
15,000 a month, it was calculated only Baht 15,000 as the basic of funding). Said employee will gain special benefits
from the Fund to have medical treatment at designated hospitals.
Paid Annual Leave
- After 1 year of service, employees are eligible for annual leave as below:
- Assistant Director Level and upwards are eligible for 15 days per annum and the others are eligible for 10 days
per annum
- Employees have to take accountability to complete their annual leave by December otherwise, annual leave cannot
be accumulated to the subsequent year.
- Annual leave can be accumulated to the subsequent year only in case of urgent of work. The accumulation should
be approved by authorized superior, but the total days should not be more than 30 for level of Assistant Director
and upwards and 20 for the others.
Compensation
- Monthly Salary
- Annual Performance Pay: between 0-4 times of monthly salary, subject to the Companyûs performance and
financial status.
- Retirement: the employee must be at the age of 60 years or early retirement by agreement of company
and employee, severance pay will be paid accord to the labor law.
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 61
Employee Training and Development
Employee Training and Development Policy
To encourage all employees to develop their knowledge, skills and attitude to be able to perform their jobs effectively
and to be more competent for career advancement, which assists the Company in achieving its corporate strategy and
goals. At present, the Company provides employees with various training and development programs, such as Core
Competency Program, Functional Competency Program, True Core Business Program, etc.
62 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
DIRECTORSû INFORMATION (AS OF 31st DECEMBER 2004)
Name
Position
Age
True Share
Experience
Ownership
(31/12/47)
77 10,000 Shares 1998-Present Independent Director
True Corporation Public Company
Limited
Present
Chairman
Advanced Agro Public Company
Limited
Chairman
Thanakorn Vegetable Oil Products
Company Limited
Chairman
Surabangyikhan Company Limited
Chairman
Thai Beverage Can Limited
Chairman
Eastern Seaboard Industrial Estate
(Rayong) Company Limited
Chairman
Thai Alcohol Public Company
Limited
Chairman of the Executive Board
Siam Food Products Public
Company Limited
Chairman of the Executive Board
Beer Thai (1991) Public Company
Limited
Vice Chairman
Berli Jucker Public Company
Limited
(Year)
Mr. Narong Srisa-an
Independent
Director
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 63
Name
Position
Age
(Year)
True Share
Ownership
(31/12/47)
Experience
Vice Chairman
General Tobacco Company Limited
Vice Chairman
Thai Beverages Public Company
Limited
Executive Director
Com-link Company Limited
Mr. Vitthya Vejjajiva
Independent
Director
and Chairman
of the Audit
Committee
68
-
1998-Present Independent Director and
Chairman of the Audit Committee,
True Corporation Public Company
Limited
Chairman
K Line (Thailand) Company
and its subsidiaries
1991-1992 Permanent Secretary of the Ministry
of Foreign Affairs
1998
Ambassador Extraordinary and
Plenipotentiary of the United States
of America
1984
Ambassador Extraordinary and
Plenipotentiary of Belgium
and the European Community
1981
Ambassador Extraordinary and
Plenipotentiary of Canada
1979
Director
General of Department of
Economic Affairs
64 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Position
Age
Dr. Kosol Petchsuwan
Independent
Director
and Member
of the Audit
Committee
66
True Share
Ownership
(31/12/47)
-
Mr. Joti Bhokavanij
Independent
Director
and Member
of the Audit
Committee
62
-
(Year)
Experience
1999-Present Independent Director and Member
of the Audit Committee
True Corporation Public Company
Limited
1999-Present President
The Telecommunications
Association of Thailand
2000-2001 Chairman
The Aeronautical Radio of
Thailand Company Limited
1997-2001 Director
The Press Council of Thailand
1998-2000 Independent Director and member
of the Audit Committee
PTT Exploration and Production
Public Company Limited
1999-Present Independent Director and
Member of the Audit Committee
True Corporation Public Company
Limited
2000-2001 Executive Chairman
TISCO Finance Public Company
Limited
1994-1997 Executive Chairman
Thai Wah Group of Companies
1992-1994 Managing Director
The East Asiatic (Thailand)
Company Limited
Consult-General of Denmark
for Bangkok
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 65
Name
Position
Age
(Year)
Mr. Dhanin Chearavanont
Chairman
65
True Share
Ownership
(31/12/47)
-
Experience
1989-Present Chairman
True Corporation Public Company
Limited
Chairman and Chief Executive Officer
Charoen Pokphand Group Company
Limited and Chia Tai Group
Company Limited
Chairman
Charoen Pokphand Foods Public
Company Limited
Mr. Sumet Jiaravanon
Vice Chairman
70 150,000 shares 1993-Present Vice Chairman
True Corporation Public Company
Limited
Executive Chairman
Charoen Pokphand Group
Company Limited
Dr. Ajva Taulananda
Vice Chairman
67
-
1992-Present Vice Chairman
True Corporation Public Company
Limited
Vice Chairman
Charoen Pokphand Group
Company Limited
Chairman
The Thai Chamber of Commerce
and Board of Trade of Thailand
1993-1999 Director and President
True Corporation Public Company
Limited
1991-1992 Duputy Minister
Ministry of Agriculture and
Cooperatives
66 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Position
Age
True Share
Experience
Ownership
(31/12/47)
76 3,500,000 shares 1992-Present Vice Chairman
True Corporation Public Company
Limited
Director
Telecom Holding Company Limited
(Year)
Mr. Chaleo Souvannakitti
Mr. Athueck Asvanund*
* Authorized Signatory
Vice Chairman
Vice Chairman
and
Group General
Counsel
53
-
1997-Present Vice Chairman and
Group General Counsel
True Corporation Public Company
Limited
Director
Telecom Holding Company Limited
Director
True Multimedia Company Limited
Group General Counsel
Charoen Pokphand Group
Company Limited
Director
CP Seven Eleven Corporation
Public Company Limited
Director
United Broadcasting Corporation
Public Company Limited
2002-Present Director
TA Orange Company Limited
Present
Director
Aqua-Agri Foods
International, Inc.
1978-1997 Baker & McKenzie
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 67
Name
Position
Age
(Year)
Mr. Supachai
Chearavanont*
Director,
President
and
Chief Executive
Officer
Mr. Soopakij
Chearavanont*
Director
* Authorized Signatory
True Share
Ownership
(31/12/47)
Experience
37 1,240,000 shares 1999-Present Director, President and
Chief Executive Officer
True Corporation Public Company
Limited
1992-1999 Director and Senior Executive
Vice President
True Corporation Public Company
Limited
40
-
1992-Present Director
True Corporation Public Company
Limited
2000-Present Executive Chairman
Telecom Holding Company
Limited
1998-Present Chairman
United Broadcasting Corporation
Public Company Limited
1991-Present Chairman
Lucent Network Technology
(Thailand) Limited
68 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Mr. Chatchaval
Jiaravanon*
* Authorized Signatory
Position
Director
and
Managing
Director
Group
Investment
True Share
Ownership
(31/12/47)
Experience
(Year)
Age
42
-
1993-Present Director and Managing Director
Group Investment
True Corporation Public Company
Limited
2001-Present Director and Member of Audit
Committee
Ticon Industrial Connection
Public Company Limited
2000-Present President and C.E.O.
Telecom Holding Company
Limited
Independent Director
Cal-Comp Electronics (Thailand)
Public Company Limited
1998-Present Executive Chairman
Cambodia Mobile Telephone
Company Limited
1997-Present C.E.O.,
True Multimedia Company Limited
True Internet Company Limited
Asia Infonet Company Limited
1992-Present Director
Thai Kodama Company Limited
1990-Present Director
Metro Machinery Public
Company Limited
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 69
Name
Mr. Vichaow
Rakphongphairoj*
* Authorized Signatory
Position
Director
Managing
Director
and
Chief Operating
Officer
Age
Experience
(Year)
True Share
Ownership
(31/12/47)
47
-
2000-Present Director, Managing Director and
Chief Operating Officer
True Corporation Public Company
Limited
1998-2000 E.V.P., Business & Enterprise
True Corporation Public Company
Limited
1997-1998 E.V.P., Central Operation &
Information Technology
True Corporation Public Company
Limited
1996-1997 Region Director,
Bangkok-Southeast Region
True Corporation Public Company
Limited
1995-1996 Region Director,
Bangkok-West Region
True Corporation Public Company
Limited
70 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Position
Age
(Year)
True Share
Ownership
(31/12/47)
Experience
Mr. Umroong
Sanphasitvong
Director
51 384,000 shares 2001-Present Director
True Corporation Public Company
Limited
Present
Deputy Group CFO
Charoen Pokphand Group
Company Limited
Director
C.P. Seven Eleven Public
Company Limited
Director
Vinythai Public Company Limited
Director
Ayudhya Allianz C.P. Public
Company Limited
Director
CPPC Public Company Limited
Mr. Heinrich Heims
Director
53
-
2000-Present Director
True Corporation Public Company
Limited
2004-Present COO / Member of the Board
of Managing Directors of
KfW IPEX-Bank
1998-Present Senior Vice President - Export
and Project Finance KfW
1978-1998 Export Finance
KfW
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 71
Name
Position
True Share
Ownership
(31/12/47)
Experience
(Year)
Age
Mr. Klaus Tuengeler
Director
63
-
2000-Present Director
True Corporation Public Company
Limited
Present
First Vice President-Export and
Project Finance
Telecommunications, Natural
Resources
KfW
Mr. Claus Stadler
Director
46
-
2000-Present Director
True Corporation Public Company
Limited
Present
Deputy General Counsel, Head of
the Legal Department (Frankfurt)
KfW
Mr. Andreas Klocke
Director
48
3,500 shares
2000-Present Director
True Corporation Public
Company Limited
Present
Head of KfWûs South-East Asia
Regional office in Bangkok in
Charge of KfW Affairs in Thailand
and South- East Asia Region
72 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Position
Age
(Year)
True Share
Ownership
(31/12/47)
Experience
Mr. Harald Link
Director
49 50,000 shares 2000-Present Director
True Corporation Public Company
Limited
1987-Present Managing Partner
B. Grimm & Co. R.O.P.
Chairman
B. Grimm Group of Companies
1981-1986 Director, Executive Committee
B. Grimm & Co. R.O.P.
1979-1980 Assistant to Managing Partner
B. Grimm & Co. R.O.P.
Dr. Lee G. Lam
Director
45
-
2003-Present Director
True Corporation Public Company
Limited
Vice Chairman / President &
CEO
Chia Tai Enterprises International
Limited
2001-2003 Managing Director
BOC International Holdings
Limited (çBOCIé)
1999-2001 Executive Director
Singapore Technologies Telemedia
1998-1999 Partner-in-charge
Heidrick & Struggles
1996-1998 President & CEO
Mil icom International Cellular Asia
Pacific Operations
1993-1995 Managing Partner
A.T. Kearney, Inc.
1989-1993 General Manager
Cable & Wireless/Hongkong
Telecom
1981-1989 Senior Executive
Bell Canada
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 73
Executive Officersû Information (As of 31st December 2004)
Name
Position
Age
(Year)
True Share
Ownership
(31/12/47)
Experience
Mr. Supachai
Chearavanont
Director,
President
and
Chief Executive
Officer
37 1,240,000 shares 1999-Present Director, President and
Chief Executive Officer
True Corporation Public Company
Limited
1992-1999 Director and Senior Executive
Vice President
True Corporation Public Company
Limited
Mr. Vichaow
Rakphongphairoj
Director
Managing
and
Chief Operating
Office
47
-
2000-Present Director, Managing Director and
Chief Operating Officer
True Corporation Public Company
Limited
1998-2000 E.V.P., Business & Enterprise
True Corporation Public Company
Limited
1997-1998 E.V.P., Central Operation &
Information Technology
True Corporation Public Company
Limited
1996-1997 Region Director,
Bangkok-Southeast Region
True Corporation Public Company
Limited
1995-1996 Region Director,
Bangkok-West Region
True Corporation Public Company
Limited
74 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Mr. Chatchaval Jiaravanon
Position
Director
and
Managing
Director
Group
Investment
True Share
Ownership
(31/12/47)
Experience
(Year)
Age
42
-
1993-Present Director and Managing DirectorGroup Investment
True Corporation Public Company
Limited
2001-Present Director and Member of
Audit Committee
Ticon Industrial Connection
Public Company Limited
2000-Present President and C.E.O.
Telecom Holding Company Limited
Independent Director
Cal-Comp Electronics (Thailand)
Public Company Limited
1998-Present Executive Chairman
Cambodia Mobile Telephone
Company Limited
1997-Present C.E.O.
True Multimedia Company Limited
True Internet Company Limited
Asia Infonet Company Limited
1992-Present Director
Thai Kodama Company Limited
1990-Present Director
Metro Machinery Public
Company Limited
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 75
Name
Position
True Share
Ownership
(31/12/47)
Experience
(Year)
Age
-
1997-Present Vice Chairman and
Group General Counsel
True Corporation Public Company
Limited
Director
Telecom Holding Company Limited
Director
True Multimedia Company Limited
Group General Counsel
Charoen Pokphand Group
Company Limited
Director
CP Seven Eleven Corporation
Public Company Limited
Director
United Broadcasting Corporation
Public Company Limited
2002-Present Director
TA Orange Company Limited
Present
Director
Aqua-Agri Foods
International, Inc.
1978-1997 Baker & McKenzie
Mr. Athueck Asvanund
Vice Chairman
and
Group General
Counsel
53
Mr. William E. Harris
Chief Financial
Officer
42 100,000 shares 2001-Present Chief Financial Officer
True Corporation Public
Company Limited
1998-2000 Executive Vice President Corporate Finance
True Corporation Public
Company Limited
1993-1998 Director
Credit Policy, Verizon Communications, Philadelphia
76 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Position
Age
(Year)
Mr. Adhiruth
Thothaveesansuk
Mr. Songtham
Phianpattanawit
Managing
42
Director
Office / SME
Solution &
Wireless Access
Managing
Director
Corporate
Solution,
Wholesales &
Data
True Share
Ownership
(31/12/47)
-
Experience
2003-Present Managing Director-Office / SME
Solution & Wireless Access
True Corporation Public Company
Limited
Acting President
Asia Wireless Communication
Company Limited
2002
Chief Commercial Officer
TA Orange Company Limited
2001
Executive Vice President
True Corporation Public Company
Limited
1998-2002 General Manager
Wire & Wireless Company Limited
1998-2001 President
Asia Wireless Communication
47 100,000 shares Present
Managing Director - Corporate
Solution, Wholesales & Data
True Corporation Public Company
Limited
Executive Director - Corporate
Solution
TA Orange Company Limited
Acting President
True Multimedia Company Limited
Acting President
Wire & Wireless Company Limited
President
True Internet Data Center
Company Limited
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 77
Name
Position
Age
(Year)
True Share
Ownership
(31/12/47)
Experience
2001-2003
2001-2002
2000
1998
1997
Country General Manager / MD
IBM Thailand Company Limited
Chairman
IBM Solution Delivery Company
Limited
Director
IBM Storage Product Thailand
Company Limited
Director, Sales & Marketing
IBM Thailand Company Limited
Country Manager, System Sales
IBM Thailand Company Limited
Country Manager Finance &
Administration and CFO
IBM Thailand Company Limited
Service Business Executive
IBM Thailand Company Limited
78 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Name
Mr. Thiti Nantapatsiri
Position
Managing
Director
Home /
Consumer
Solution &
Highspeed
Access
(Year)
Age
True Share
Ownership
(31/12/47)
51
-
Experience
Present
1999-2003
2001-2002
1992-2000
1997-1999
Managing Director- Home /
Consumer Solution &
Highspeed Access
True Corporation Public Company
Limited
Executive Vice President
Loxley Public Company Limited
President & CEO
Hutchison CAT Wireless Multimedia
Company Limited
President & CEO
Hutchison Telecommunications
(Thailand) Company Limited
First Senior Vice President
Loxley Public Company Limited
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 79
The Company Directorsû Shareholding in TRUEûs affiliates as at 31st December 2004 are as follows:
Director
Company
Change
in 2004
Outstanding
Share(s)
Mr. Dhanin Chearavanont Telecom Holding Co., Ltd.
Bangkok Inter Teletech Co., Ltd.
-
1
1
Mr. Sumet Jiaravanon
Bangkok Inter Teletech Co., Ltd.
-
1
Mr. Chaleo Souvannakitti
Telecom Holding Co., Ltd.
Telecom International Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
-
1
1
1
Dr. Ajva Taulananda
Telecom International Co., Ltd.
Telecom Training and
Development Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
U-Net Co., Ltd.
True Internet Co., Ltd.
(Formerly named Asianet
Corporation Co., Ltd.)
Asia DBS Public Company Limited
Asia Infonet Co., Ltd.
Asia Wireless Communication Co., Ltd.
True Multimedia Co., Ltd.
(Formerly named Asia
Multimedia Co., Ltd.)
N.T.U. (Thailand) Co., Ltd.
-
1
1
-
1
-
1
1
-
1
1
1
1
-
1
-
1
1
-
5
Mr. Chatchaval Jiaravanon Telecom International Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
Wire & Wireless Co., Ltd.
80 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
Director
Company
U-Net Co., Ltd.
True Internet Co., Ltd.
(Formerly named Asianet
Corporation Co., Ltd.)
Asia DBS Public Company Limited
Asia Infonet Co., Ltd.
Asia Wireless Communication Co., Ltd.
True Multimedia Co., Ltd.
(Formerly named Asia
Multimedia Co., Ltd.)
Yai Kaew Co., Ltd.
Mr. Soopakij Chearavanont
Telecom International Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
U-Net Co., Ltd.
True Internet Co., Ltd.
(Formerly named Asianet
Corporation Co., Ltd.)
Asia DBS Public Company Limited
Asia Infonet Co., Ltd.
Asia Wireless Communication Co., Ltd.
True Multimedia Co., Ltd.
(Formerly named Asia Multimedia Co., Ltd.)
Mr. Supachai Chearavanont Telecom Holding Co., Ltd.
Telecom International Co., Ltd.
Telecom Training and
Development Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
Wire & Wireless Co., Ltd.
Change
in 2004
-
Outstanding
Share(s)
1
1
-
1
1
1
1
-
1
-
1
1
-
1
1
-
1
1
1
1
-
1
1
1
-
1
-
5
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 81
Director
Company
Change
in 2004
Outstanding
Share(s)
U-Net Co., Ltd.
True Internet Co., Ltd.
(Formerly named Asianet
Corporation Co., Ltd.)
Asia DBS Public Company Limited
Asia Infonet Co., Ltd.
Asia Wireless Communication Co., Ltd.
True Multimedia Co., Ltd.
(Formerly named Asia Multimedia Co., Ltd.)
T-Pay Co., Ltd.
-
1
1
-
1
1
1
1
1
1
Mr. Athueck Asvanund
NC True Co., Ltd.
T-Pay Co., Ltd.
1
1
1
Mr. Harald Link
Telecom Equipment
Manufacturing Co., Ltd.
480,000
480,000
Mr. Vichaow
Rakphongphairoj
Telecom International Co., Ltd.
Telecom Equipment
Manufacturing Co., Ltd.
U-Net Co., Ltd.
True Internet Co., Ltd.
(Formerly named Asianet
Corporation Co., Ltd.)
Asia DBS Public Company Limited
Asia Infonet Co., Ltd.
Asia Wireless Communication Co., Ltd.
True Multimedia Co., Ltd.
(Formerly named Asia Multimedia Co., Ltd.)
K.I.N. (Thailand) Co., Ltd.
T-Pay Co., Ltd.
-
1
1
-
1
1
-
1
1
1
1
1
1
1
82 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
During 2004, the Group carried out the transactions with subsidiaries, associates, joint ventures and related companies
and persons as disclosed in the Note 4, Note 9, Note 12, Note 17, Note 22 and Note 32 to financial statements for year
ended 31st December 2004.
Measures and Procedures for Approving the Entering into of Connected Transactions
The Company has measures and procedures for approving the entering into the connected transactions in compliance
with the Rules and Regulations of the office of Securities and Exchange Commission (çSECé) and the Stock Exchange of
Thailand (çSETé), and the provisions of the Public Companies Act, i.e. related party transactions must obtain approval from
the Independent Directors. If any related party transaction is deemed to be a connected transaction, said transaction must
obtain approval from the Audit Committee, the Board of Directors and/or Shareholders Meeting as the case may be,
according to the Regulation of the Stock Exchange of Thailand. Moreover, the Company must comply with the terms and
conditions of the Common Terms Agreement First Amendment and Restatement Agreement dated 14th October 2003 which
is the principal debt agreements executed between the Company and its Secured Creditors, and related agreements. The
key terms and conditions in said Agreement and related agreements with regard to connected transactions specify that the
Company shall not enter into any contract, agreement, or arrangement with any affiliates other than on armsû length open
market terms. Apart from the foregoing obligation, the terms and conditions of the Shareholders Agreement executed with
Kreditanstalt für Wiederaufbau dated 22nd December 1999 specify that the Company shall have to disclose the entering into
any connected transactions of the major shareholders or its affiliates.
Policy for Future Connected Transactions
In addition, in order to strictly comply with the rules and regulations of the SEC and the SET, the Company has applied
said rules and regulations in implementing an internal guideline for connected transactions by undertaking a comparative
study of the connected transactions guidelines from various foreign institutions to enhance transparency and create parallel
understanding with foreign analysts and investors. With regard to future connected transactions, the Company anticipates
that there will be connected transactions in the ordinary course of business of the Company with its affiliates and the
Company shall proceed with such transactions in a transparent manner pursuant to the good corporate governance policy
of the Company as well as all relevant regulations.
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1. Audit fees
The Company and subsidiaries paid for audit fees of Baht 13,431,000 for the year 2004 to appointed auditing firm.
2. Other non-audit fees
The Company paid for other non-audit fees, i.e. engagement to perform agree-upon procedures and IT internal audit
consulting services to appointed auditing firm. The fee amount of Baht 2,208,000 was paid during the year and the remaining
amount of Baht 366,800 was carried forward to the following year upon the completion of work.
84 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED
By virtue of a resolution of the Board of Directors of the Company passed at its meeting No. 1/2546 held on 27th
February 2003, the Audit Committee was re-appointed to perform duties and discharge responsibilities under the charter for
the Audit Committee. During the year 2004, the Audit Committee proceeded as follows:
1. held 8 committee meetings in 2004 in order to discharge its functions as assigned by the Board of Directors. The
management was invited to provide extra information in certain agenda items. The Audit Committee reported its
activities to the Board of Directors on a quarterly basis;
2. considered and proposed the appointment and remuneration of PricewaterhouseCoopers ABAS Limited as the
Companyûs external auditor for the year 2005;
3. reviewed the quarterly and annual financial reports of the Company and its subsidiaries to ensure correctness,
reliability and adequacy of information disclosed, reflecting good corporate governance;
4. acknowledged the Audit Plan and external auditorûs findings and provided recommendations;
5. considered the internal audit plan under risk-based approach and the monthly, quarterly and annual results as well as
submitted suggestions on actions to be taken by the management, and also on following up the progress of these actions;
6. regularly reviewed the Companyûs and its subsidiariesû practices relating to connected transactions to ensure
compliance with the regulations of the Stock Exchange of Thailand;
7. closely monitored the work progress of Internal Audit Department in order to enhance effectiveness of the internal
audit function and continuously ensured that the Company improved its internal controls system to enhance
efficiency and effectiveness and ensure appropriate compliance with applicable regulatory requirements;
Towards this end, the Management upon the recommendation of the Audit Committee engaged
PricewaterhouseCoopers Risk Management Services Limited to provide IT internal audit consulting services which aim
for development of the standards and performance of the IT internal audit activities. In this regard, the Audit Committee
has been closely monitoring the progress of the consulting services project which was completed in 2004.
This project, which has achieved its purpose, is an essential step in strengthening the IT internal audit function
of the Company;
8. initiated a synergic combination of TRUE and TA Orange Internal Audit functions. In view of such synergy,
the combined Internal Audit Department will be further strengthened and more effective towards attaining its goals.
(Mr. Vitthya Vejjajiva)
Chairman of the Audit Committee
ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED 85
The Board of Directors is responsible for the financial statements of the Company and its subsidiaries. The
aforementioned financial statements have been prepared in accordance with Generally Accepted Accounting Principles, using
appropriate accounting policy consistently employed by the Company as well as applying careful judgment and best
estimation. Important information is adequately disclosed in the notes to financial statements.
The Board of directors has provided and maintained an efficient internal controls system to ensure that accounting
records are accurate, complete and adequate to protect its assets.
To accomplish this task, the Board of Directors has appointed an Audit Committee, which consists of Independent
Directors responsible for the quality of financial statements and internal controls system, whose comments on these issues
are readily included in the Audit Committee Report in this Annual Report.
The Board of Director is of the opinion that the Companyûs overall internal controls system is adequate and suitable and
has rendered credibility and reliability to the financial statements of the Company and its subsidiaries for the year ended 31st
December 2004.
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31 December 2004
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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The accompanying notes on pages 102 to 158 are an integral part of these financial statements.
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