REVIEWED QUARTER-2 1997/1998 (REVISED)

AUDITOR'S REPORT To the Shareholders of Singer Thailand Public Company Limited I have performed a review of the accompanying consolidated and company balance sheets as at 31 December 1997 and 1996, and the related consolidated and company statements of income,of changes in shareholders'equity, of retained earnings and of cash flows for the three-month and six-month periods then ended of Singer Thailand Public Company Limited in accordance with standards established by the Institute of Certified Accountants and Auditors of Thailand. A review of interim financial statements consists principally of obtaining an understanding of the system for the preparation of the financial statements, making an analytical review of pertinent financial data, and making inquiries of officials of the company who have responsibility for financial and accounting matters. This review is substantially less in scope than an examination in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole.Accordingly, I express no opinion on the financial statements which I have reviewed. We draw attention to Note 5 to the financial statements. The company's operations have been affected, and are expected to continue to be affected for the foreseeable future, by the current economic crisis involving a slowdown in economic growth, a shortage of liquidity within the country and the volatility of the securities market and the value of the Thai Baht. The ultimate outcome of this crisis cannot be determined at present. The interim financial statements for the three-month and six-month periods ended 31 December 1997 do not include any adjustments that may arise as a result of the effects of the crisis. Based on my review as stated above, I am not aware of any material modificat ions that should be made to the aforementioned interim consolidated and company financial statements for them to be in conformity with generally accepted accounting principles. SUCHART LUENGSURASWAT Certified Public Accountant (Thailand) No. 2807 PRICE WATERHOUSE LIMITED Bangkok 30 January 1998 SINGER THAILAND PUBLIC COMPANY LIMITED BALANCE SHEETS AS AT 31 DECEMBER (UNAUDITED) ASSETS Consolidated Company 1997 1996 1997 1996 Baht Baht Baht Baht CURRENT ASSETS Cash in hand, at banks and in transit 42,867,090 13,303,582 42,293,504 12,617,633 Short-term investments 101,000,000 196,000,000 100,000,000 195,000,000 Trade and installment accounts receivable (net) 4,488,222,129 5,066,195,233 4,483,852,948 5,062,456,518 Inventories 1,430,466,356 1,466,390,472 1,365,991,107 1,414,231,693 Amounts due from - - subsidiary - - 13,382,669 19,518 - related company 28,484 - 28,484 - Loan to subsidiary - - 87,292,000 - Prepaid rent 20,000,000 24,000,000 20,000,000 24,000,000 Other current assets 51,496,678 63,968,063 43,693,701 59,124,605 TOTAL CURRENT ASSETS 6,134,080,737 6,829,857,350 6,156,534,413 6,767,449,967 RECEIVABLE FROM AND LOANS TO EMPLOYEES 7,079,097 4,492,562 6,073,983 3,529,500 INVESTMENTS IN SUBSIDIARIES (Note 2) - - 6,591,655 5,343,655 OTHER INVESTMENT 1,970,000 1,970,000 1,970,000 1,970,000 PROPERTY, PLANT AND EQUIPMENT (net) 737,006,577 734,304,822 579,293,103 574,376,556 PREPAID RENT 87,320,446 86,814,796 87,320,446 86,814,796 TOTAL ASSETS 6,967,456,857 7,657,439,530 6,837,783,600 7,439,484,474 .......................................................... Director .......................................................... Director SINGER THAILAND PUBLIC COMPANY LIMITED BALANCE SHEETS AS AT 31 DECEMBER (UNAUDITED) LIABILITIES AND SHAREHOLDERS' EQUITY Consolidated Company 1997 1996 1997 1996 Baht Baht Baht Baht CURRENT LIABILITIES Bank overdrafts and short-term loans 1,540,027,514 1,849,154,967 1,532,183,081 1,781,662,016 Current portion of long-term loans 40,000,000 656,000,000 40,000,000 656,000,000 Unsecured debentures due for redemption within one year - 300,000,000 - 300,000,000 Accounts payable - - other companies 278,385,957 517,841,859 264,156,159 489,765,211 - related companies 21,233,008 13,056,534 21,233,008 13,056,534 Amounts due to- -subsidiary - - 40,208,531 46,548,536 -related companies 94,643,583 45,867,617 94,446,737 44,700,860 Dividends payable 35,445,645 22,659,110 35,445,645 22,659,110 Accrued income tax 1,309,401 112,641,679 - 108,860,245 Accrued liabilities 436,905,220 387,166,882 433,826,454 380,745,351 Other current liabilities (Note 3) 50,684,694 53,706,823 50,569,985 53,609,732 TOTAL CURRENT LIABILITIES 2,498,635,022 3,958,095,471 2,512,069,600 3,897,607,595 UNSECURED DEBENTURES 500,000,000 - 500,000,000 - LONG-TERM LOANS 1,634,580,000 1,002,600,000 1,634,580,000 1,002,600,000 EMPLOYEES SECURITY 207,140,327 225,808,853 207,026,835 225,725,643 DEPOSITS PROVIDENT FUNDS 197,954,880 184,107,415 197,954,880 183,257,701 TOTAL LIABILITIES 5,038,310,229 5,370,611,739 5,051,631,315 5,309,190,939 SINGER THAILAND PUBLIC COMPANY LIMITED BALANCE SHEETS AS AT 31 DECEMBER (UNAUDITED) LIABILITIES AND SHAREHOLDERS' EQUITY (CONT'D) Consolidated Company 1997 1996 1997 1996 Baht Baht Baht Baht SHAREHOLDERS' EQUITY Share capital Registered, issued and fully paid 27,000,000,000 ordinary shares of Bht 10 each 270,000,000 270,000,000 270,000,000 270,000,000 Share premium 225,000,000 225,000,000 225,000,000 225,000,000 Surplus on revaluation of land 235,866,403 235,866,403 128,788,768 128,788,768 Retained earnings: Appropriated - Legal reserve 27,000,000 27,000,000 27,000,000 27,000,000 Unappropriated 1,171,280,225 1,528,961,388 1,135,363,517 1,479,504,767 TOTAL SHAREHOLDERS' EQUITY 1,929,146,628 2,286,827,791 1,786,152,285 2,130,293,535 TOTAL LIABILITIES AND SHAREHOLDERS'EQUITY 6,967,456,857 7,657,439,530 6,837,783,600 7,439,484,474 SINGER THAILAND PUBLIC COMPANY LIMITED STATEMENTS OF INCOME (UNAUDITED) FOR THE THREE MONTHS ENDED 31 DECEMBER Consolidated Company 1997 1996 1997 1996 Baht Baht Baht Baht REVENUES Sales 873,704,175 1,711,776,766 868,827,168 1,705,644,842 Interest from installment sales 363,028,896 423,986,342 363,028,896 423,986,342 Other income 2,552,176 3,416,743 2,517,211 2,480,299 TOTAL REVENUES 1,239,285,247 2,139,179,851 1,234,373,275 2,132,111,483 EXPENSES Cost of sales 684,424,002 1,129,658,937 680,948,173 1,135,416,156 Selling and administrative expenses 570,137,036 727,431,646 565,553,532 718,647,737 Interest and other financial costs 132,961,868 100,536,289 132,074,757 99,883,127 Income tax 1,278,850 58,782,330 - 56,944,131 TOTAL EXPENSES 1,388,801,756 2,016,409,202 1,378,576,462 2,010,891,151 INCOME (LOSS) BEFORE EXTRAORDINARY ITEM (149,516,509) 122,770,649 (144,203,187) 121,220,332 Extraordinary item: Loss from the Managed Float Exchange System (Note 4) (55,266,327) - (53,797,894) - NET INCOME (LOSS) FOR THE PERIOD (204,782,836) 122,770,649 (198,001,081) 121,220,332 EARNINGS PER SHARE Income (loss) before extraordinary item (5.54) 4.55 (5.34) 4.49 Extraordinary item (2.05) - (1.99) - Net income (Loss) for the period (7.59) 4.55 (7.33) 4.49 SINGER THAILAND PUBLIC COMPANY LIMITED STATEMENTS OF INCOME (UNAUDITED) FOR THE SIX MONTHS ENDED 31 DECEMBER Consolidated Company 1997 1996 1997 1996 Baht Baht Baht Baht REVENUES Sales 1,952,920,920 3,208,852,386 1,942,274,805 3,195,880,430 Interest from installment sales 763,855,235 875,427,077 763,855,235 875,427,077 Other income 3,294,223 5,374,373 2,926,347 2,480,299 TOTAL REVENUES 2,720,070,378 4,089,653,836 2,709,056,387 4,073,787,806 EXPENSES Cost of sales 1,479,190,332 2,134,075,379 1,471,767,254 2,146,693,075 Selling and administrative expenses 1,184,851,111 1,397,836,129 1,178,942,189 1,385,153,740 Interest and other financial costs 245,706,924 195,376,110 242,116,813 191,459,193 Income tax 3,165,918 113,201,041 - 108,976,708 TOTAL EXPENSES 2,912,914,285 3,840,488,659 2,892,826,256 3,832,282,716 INCOME (LOSS) BEFORE EXTRAORDINARY ITEM (192,843,907) 249,165,177 (183,769,869) 241,505,090 Extraordinary item: Loss from the Managed Float Exchange System (Note 4) (123,994,667) - (117,827,504) - NET INCOME (LOSS) FOR THE PERIOD (316,838,574) 249,165,177 (301,597,373) 241,505,090 EARNINGS PER SHARE Income (loss) before extraordinary item (7.14) 9.23 (6.81) 8.94 Extraordinary item (4.59) - (4.36) - Net income (Loss) for the period (11.73) 9.23 (11.17) 8.94 (More)