Reasons for over 20% change in company's operations

( Translation ) No. 024/2541 15 May 1998 Re : Reasons for over 20% change in company's operations To : Director of Listed Companies Department Stock Exchange of Thailand As shown in the third quarter consolidated financial statements, the company has suffered a loss after tax including an exchange loss amounting to Baht 219 million, representing a sharp decrease of 154 % vs the after-tax profit of Baht 402 million achieved for the same period of prior year. In this connection, the company wish to provide reasons for the unfavorable result of its operations as follows : - 1. The exchange loss with the amount of Baht 71 million for nine months ended 31 March 1998 was reported as extraordinary item in accordance with the announcement of the Institute of Certified Accountants and Auditors of Thailand No. 002/2540-2542 dated 19 September 1997. This exchange loss has not yet been realised as such three-year loan will be due for repayment in July 1999, January 2000 and July 2000, respectively by three consecutive equal instalments. 2. Loss from operations for the period of nine months covering July 1997 to March 1998 amounting to Baht 148 million was due to :- 2.1 Decrease in sales of 37.1 % or Baht 2,345 million from the same period of prior year. The country's worsening economic slowdown, rising unemployment and the continuous company's responsive strict measures on hire purchase financing scheme, all attributed to the company's weakening sales. 2.2 Some expenses could not be reduced immediately in proportion to the dwindling revenue , when compared a decrease of selling and administration expenses by 21.2 % with a decrease of sales by 37.1 % within the same period of prior year. 2.3 As a result of liquidity crunch, the company had to bear higher interest rates from 11-12% per annum in 1997 to 15-17 % per annum in 1998. By the way, result of operation analysis by quarter showed the company can improve the operation from loss in the first and the second quarter to be gain in amount of Baht 44 million in the third quarter. Yours sincerely, Singer Thailand Public Company Limited ( Mr. Wadhana Trikandha ) Director