13 สิงหาคม 2552
Submission of F/S for Q2/2009 with MD&A
August 13, 2009
To: President,
Stock Exchange of Thailand.
Re: Submission of Financial Statements for the 2nd Quarter of
this Year.
Enclosures: Financial Statements for the 2nd Quarter of this Year
and the relevant management discussion and analysis.
We are sending you herewith the enclosed financial statements
of the company and the consolidated statement of the group for the 2nd
quarter of this year ended June 30, 2009, which were reviewed by the Auditor
and our Audit Committee has already reviewed them.
BEC World group was able to increase it net profit up 10%
higher than that of the previous quarter; making Baht599 millions as its net
profit for the shareholders of the group. However the growth rate of our
profitability was temporary lowered down, even our advertising income jumped
quarter-on-quarter by more than 15%, recovering from slump experienced in
the previous quarter by the supports of many key advertisers who had
substantially increased their spending with us, but our operating costs during
the quarter also increased and we also had made a big donation on the 39th
anniversary of our "Channel 3". When comparing our results year-on-year, the
impact of the higher operating costs is even more obvious as our adverting
income had increase only marginally while the profitability of our "concerts &
shows" business is lowered down as well, and our effecting corporate income
tax increased as certain expenses is partially allowed in tax calculation;
thus pulling our net profit down significantly in the quarter when compares
with that of the same quarter of prior year, as discussed further in the
attached
management discussion and analysis.
Please be informed accordingly.
Sincerely Yours,
(Chatchai Thiamtong)
Vice President - Finance
BEC World Plc.
Consolidated Financial Statements for the 2nd Quarter of the year 2009
Management Discussion and Analysis:
Business Environment:
Nielsen Media Research (Nielsen) reported that since the beginning of the 2nd
quarter the industry, advertising expenditure through television (adex), has
reversed it up-ward tend reported since the beginning of this year. The adex
has continued lowered down year-on-year (YoY) throughout the quarter even
the 2nd quarter is still bigger than the 1st quarter as usual. Nielsen also
reported that the adex had dropped substantially in one of the main channel
thus pushed the adex market-share of "Channel 3" up to the top of the industry
once again throughout the first-half of this year. However, when reviewed the
report in details, it is obvious that several big and mid-size advertisers
have increased their adex from the prior year level; some of them also
increased their adex more than 20 percent. It's a strong evidence of
diversity, strength and growth opportunity of the industry, as usual.
Structure Changes:
During the 2nd quarter of 2009, the BEC World group was almost unchanged
except that we had changed the name of "BEC-Tero Arsernal Ltd.", a dormant
subsidiary wholly owned by "BEC-Tero Entertainment Plc." a subsidiary of BEC
World, to "BEC-Tero Com Com Ltd."; then sold 49% ownership to an outsider
and increased its registered and paid-up capital by Baht10 millions to Baht28
millions which all the existing shareholders agreed to keep their portion.
Therefore, this company is still our subsidiary company having "BEC-Tero
Entertainment" holds 51% its shares. This company is preparing to start its
new business, selling adverting on the screens of the mobile phones.
Operating Results:
Due to the accounting policy for investments, the reported profit as shown in
the separate statements is difference from that shown in the consolidated
statement. This MD&A will discuss those numbers shown in the consolidated
statement in order to avoid any confusion.
BEC World group was able to increase it net profit up 10% higher than that of
the previous quarter; making Baht599 millions as its net profit for the
shareholders of the group. However the growth rate of our profitability was
temporary lowered down, even our advertising income jumped quarter-on-
quarter by more than 15%, recovering from slump experienced in the previous
quarter by the supports of many key advertisers who had substantially
increased their spending with us, but our operating costs during the quarter
also increased and we also had made a big donation on the 39th anniversary of
our "Channel 3". When comparing our results year-on-year, the impact of the
higher operating costs is even more obvious as our adverting income had
increase only marginally while the profitability of our "concerts & shows"
business is lowered down as well, and our effecting corporate income tax
increased as certain expenses is partially allowed in tax calculation; thus
pulling our net profit down significantly in the quarter when compares with
that of the same quarter of prior year.
Revenues:
Our advertising income in the second quarter of this year was increased higher
than that of the prior quarter by 15% and also slightly higher year-on-year
which are the better growth rates compared with the industry. We are
recovering from slump experienced in the previous quarter by the supports of
many key advertisers who had substantially increased their spending with us
and we did also able to increase our air-time rates on certain day parts and
benefited from expansion and shuffling of prime-time slots. The concerts and
shows revenue is declined quarter-on-quarter and year-on-year as the number
of shows reduced in the quarter in line with the epidemic of the flu.
Costs and Operating Expenses:
Our costs and operating expenses in the 2nd quarter this year are higher
quarter-on-quarter and year-on-year. Cost of services increased as we changed
our programming chart to have more of our own shows and expanded our
prime-time. Costs of concerts and shows reduced in line with revenue. The
selling expenses increased in line with revenue and more marketing activities.
The administrative expenses increased mainly because of the donation on the
39th anniversary of "Thai TV Channel 3" and we also recognized the losses
incurred in our associated "Vergin BEC-Tero Radio" in administrative expenses
whereas this transaction was partially shown separately in prior year accounts.
Financial positions:
Our total assets decreased when compared with balances at the end of the
prior year as cash and short term investment of our cash decreased after the
payment of our prior year's final dividends during the quarter. Our liabilities
increased from that level at the end the prior year as the amounts received
from selling of tickets of 3rd parties' shows and our accrued expenses at the
end of the quarter are higher. Our shareholders' equity slightly decreased
after the big dividend payments. BEC World's financial positions are strong as
usual.