Asked the Company to explain about flooding in 2011 as well as asked about status and direction of automotive industry after the situation is resume normal. In addition, he suggested presenting future plan of the Company at level that can be disclosed.

The 2011 flood started in October in the Northern province of Pathumthani. Water ran into several industrial estates resulting in flood. The Company assessed the situation and we were likely to be effected from flood. We got help from Stanley Electric (Japan) and then we set up Business Continuity Plan (BCP) activity. BCP activity is for the Company to produce goods for customers as well as to maintain status and prevent flood. However,on October 20th, 2011, water ran into the Company. The Company got coordination from approximately 200 employees to work and help preventing from flood until water level in the Company reduced and we could continue the production process and delivery goods on November 14th, 2011 although surrounding area was still flooded. The Company thought that capability to resume production and delivery goods for customers and the customers did not have to stop their production was from support of employees, customers, suppliers, and good suggestions from shareholders. Although the recent flood was not good remembrance, but the Company will think to handle this situation in the future and further strengthen the Company’s capability. Which  Thai Stanley members need to cooperation working.

In 2012, the Company has a good trend. In May, the production is the highest record both in automotive industry and in Thailand. Supportive factors for the growth of automotive industry are; firstly, 2011 flood shifted the need for car buying to 2012, secondly, according to the first car policy of the government, thirdly, economic status has been continuously improved after flood. In addition, some cars were damaged from flood therefore people need to buy a new one or claim the insurance company resulting in buying new cars which is deemed as supportive factors. Although trend of automotive industry seems to be cheerful, but the Company is still follow up factors that may effect the Company including outside country factor, Europe economic problem ,that could effect Thailand as well, and inside country factor, political conflict and the 2nd flood. However, the Company forecast refers to the expectation of the automotive industry to produce 2-2.1 million cars and 2 million motorcycles.

Last year, flood level was between 1-1.30 meters. This year, the Company has follow up water level in 2 major dams; Bhumipol and Sirikit, and current storage capacity is 46% which is still able to handle water. In addition, the Company has follow up  rainfall and hope that there will be no flood this year. According to claim money, it is during the continual negotiation in order to get the highest amount of money from the insurance company. For order in June, it could be used as an indicator of this year. Currently, we have full production capacity both car and motorcycle. In addition, we arrange overtime work and work on holidays as well. However, the Company will be careful about production capacity of both the Company and suppliers.

New plant (Lamp 7) was effected from flood then the construction schedule was postponed to be done in May. The plant building has finished. Some machines have been installed. In July, we will start production and deliver goods to customers.

From financial statement, total expense is 793 million baht; net flood expense is 162 million baht according to notes No. 21 of the financial statement showing total flood expense of 346 million baht. The first installment claim from insurance company is 184 million baht. Therefore, flood expense is 162 million baht. I would like to asked total flood expense which has requested claim from insurance company? How much the insurance company owe the Company?  

The Company was severely effected by flood and submitted insurance claim for approximately 500 million baht and has already received 184 million baht. The rest amount claim is in the process of documentation inspection and negotiation for mutual agreement. This requires time because there are many details and the re-insurers have involved in consideration process. The Company will try to get the highest amount of claim money.

For Business Interruption, this is under consideration of insurance company since it requires thoroughly consideration of the Company’s business.

From the financial statement, short term investment which has been hold until the due is 198 million baht which is 560 million baht reduces from the previous year. Why this amount is reduced? What is 35 million baht corporate income tax  refundable because there is no item of  tax  refundable in last year.

Short term investment which has been hold until the due date is saving account that the Company deposit for 1-3 month. In the previous years, the company spent money in saving account for investment. Due to there are a lot of investments in last year, therefore, saving account balance is reduced.

Corporate tax refundable  is tax that the Company will refund from the first 6 months performance with good profits thus the Company has over paid corporate  tax. Therefore, the Company has established an account for tax return from the Department of Revenue.  

Previous year minutes of meeting mentioned about the expiration of the investment promotion certificate, why there is still business having the investment promotion certificate this year? What kind of the investment promotion certificate?

The Company has many investment promotion certificates including auto head lamp project and mould project, and research and development. Each project will be expired in different time. Currently, projects under investment promotion certificate are mold project and research and development

Previous year, profits of the Company was reduced by 50%, thus, the Company should pay dividend 50% reduced from previous year which is 3.50 baht per share. As I know, Japan Company will maintain dividend payment the same as previous year and will not pay lower than the previous year.

The Company’s dividend policy does not consider whether it is Japan or Thai Company. Also, Company’s dividend policy is not lower than 30% of net profit. In 2010, the Company paid 6.50 baht per share. In 2010, 5.00 baht per share. In 2011, the Company paid in higher rate because it is the 30th anniversary of the Company. However, since the company faced with flood, then the Company required investing in order to prevent flood and some money is to be used for further investment. The Company has tried to make the highest profit for higher dividend.

Recommended the Company to consider dividend payment close to interest rate or inflation rate and the appropriate rate is 6 baht. This is because the Company is capable to pay after consideration from retain earning approximately 7,600 million baht and cash approximately 1,700 million baht.  Although the Company was effected by flood but it can be claimed from insurance company. Therefore, could the Company reconsider dividend payment.

The Company has invested a lot of money in new plants and equipment. Previous year investment was 1,900 million baht and will continually invest in order to support Eco Car. Investment plan for this year is approximately 2,000 million baht. Also, the Company cannot forecast future aspects such as Europe economic problem or flood risk in this year as well as risk from national political problem. Thus, the Company adheres to long term security according to the  sufficient economic principle for being sufficient, reasonable, and being immune which is very important. One example is in 1997 when the Company faced with economic problem and did not get any support from the bank. The Company, therefore, adhered to the middle way principle in orderto conduct business which will create long term security and prosperous for shareholders.

For accumulated profits of 7,600 million baht, this is not cash and it is invested as accrued property.

The Company previous year investment is approximately 1,900 million baht and this year investment is 2,000 million baht. Total investment is 4,000 million baht. Shareholders should get higher dividend.

Thank you for recommendation. The Company will take for consideration in the Board of Director meeting for the best dividend of shareholders.

The Company performance is great during situation the Company faced with Tsunami and flood. For dividend, I agreed with other shareholders to request consideration to compare with interest rate and inflation rate. This is because when compare with current share price, it is only 1.5% which is so low. Also, I would like to admire the Company to be careful in doing business. However, too much careful will cause the Company unable to use resource for value-added purpose. According to page 71 of the annual report, ratio between net profit and net income is approximately 12-15% and 8% in last year while shareholder dividends are in the same direction.  I would like to raise a note that if the profit rate is high like this, what if the Company loan some money from bank with interest rate lower than 5%? In addition, due to 1,900million baht cash and industry development, could the Company consider of interim dividend payment.

Thank you for recommendation.

Previous year asking about shareholders who did not receive dividend, what did the Company do?

The Company contact with Thailand Securities Depository Company Limited in order to contact with foreigner shareholders who do not have address in Thailand and unable to contact.

I would like to ask to review dividend payment again by giving an example of other companies’ dividend ratio which have same carefully business operation principle and adhere to middle way principle  as  the Company . They have debt to capital almost the same with the Company. When compare with the Company’s share price, the Company pay lower rate of dividend.

Thank you for recommendation. The Company will take this issue for consideration in the next Board of Director meeting. However, the Company will invest and spend money in other business opportunity. The Company would like to ask shareholders to understand the Company as well.

The review of compliance with condition of BOI promotion expense 115,500 baht . This is calculated from per certificate or total. Currently, how many certificate the Company has? Has Lamp 7 plant got the BOI promotion certificate?

The expense for BOI promotion certificate is per certificate. Currently, there is only 1 certificate of the mold business. Lamp 7 plant will receive one promotion certificate for Eco Car business.

Asked effect of the minimum wage of 300 baht and salary 15,000 baht for Bachelor degree. How the Company deal with that situation?

How much is the 2012 investment budget? How much budget for Lamp 7 project?

From zero defect project, what is the Company’s current defect rate?

Please explain export sale as refer to note No. 24 of financial statement on export sale which is continually growth. Which part of this export sale comes from?

The Company has increased the minimum wage to 300 baht since April 1st, 2012. This is 40% increased from previous wage of 215 baht. In addition, the Company has increased salary for all levels of employees in order to maintain salary structure. This results in 1.7% cost increment. The Company deal with this problem by applying SNAP (Stanley New Approach for higher Productivity) activity to increase productivity. In addition, the government announced to reduce  income tax to 23% which is good for the Company as we will be able to balance the increased cost.

For zero defect project, the Company still have a target and continually conduct activity. I have to accept that this project is difficult. This year defect target is 1.1%but we are still unable to reach it. Current defect rate is 1.9%.

Lamp 7 investment for building and machines is approximately 1,900 million baht. For export sale, there is no export sale for auto lamp but only for motorcycle light bulb and mould which we sale to lamp production in other countries.

After flood, how automotive production companies plan to invest in Thailand in the future? Is there any possibility that they will move their production bases to other countries? In addition, does the Company have any plan to move the production base to support new investment or not? Also, asked about AEC (Asean Economic Community) in 2015, how AEC will effect the Company? Is there any opportunity to create new products?

The customer’s companies have not yet informed or given any warning sign to move their production bases. In addition, from news in several media, the customer’s companies still have investment in Thailand continually.

For our Company, it has been established for 30 years. It is well-known for surrounding community, employees who live in this area, customers, as well as auto part sale companies. After flood in last year, the Company does not consider to move our production base. The Company is still requiring growing together with the Company’s community.

According AEC, the Company is continual studying effect such as labor movement.

Motorcycle tends to use LED for headlight. The Company has studied this although there is still no affirmation news about that.

Asked production capacity and profit rate of Lamp 7 plant.

Is production rate in June 2012 is equal to May 2012 which is the highest production or not?

In this year, the Company plans the production capacity of Lamp 7 to over 20%.

Profit of Lamp 7 plant is still unclear because there are many expenses such as deficiency which is unable to make profit in the first period of operation. However, the Company will try to apply SNAP system in order to make profits from Lamp 7 faster.

Production capacity of other plants except Lamp 7 plant is 100%.

Please explain the Company’s flood prevention plan.

The Company has concept to prevent flood by using Logo Toweras a center since the different of the last year flood water level was between 80-120 centimeters. Concept to prevent from flood is to construct curb with 1 meter higher than the previous year level. Type of prevention curb is different by area of the Company. There are 4 types of curbs; Type A is 70 centimeters thickness concrete dam; Type B is 40 centimeters thickness concrete dam at the front fence of the Company; Type C is 70 centimeters concrete wall with support concrete since it is located at pond area; and Type D is soil dam which its height is according to water level plus 1 meter and the width is approximately 3-3.5 meters. Soil of each layer is crushed. Cars can be driven on the top of the soil dam. Currently, 50-60% construction has finished.

At gate of the plant, aluminum is installed as curb which is stronger than using concrete block. Water pipe is equipped with the steering wheel type closing valve. In addition, the Company has prepared 4 of water pumps size 15 inches at each location.

Asked how much budget to prepare for this flood prevention? What step of the preparation?

Budget is approximately 100 million baht. This is deemed as permanent investment for long term because we don’t know that when it will flood again. Currently, 60% of construction is finished and is expected to be completely finished in August in order to have some times to check all equipment before water reaching in October as happened last year.