PTG ENERGY PUBLIC COMPANY LIMITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS 31 DECEMBER 2017
Independent Auditor s Report To the shareholders and the Board of Directors of PTG Energy Public Company Limited My opinion In my opinion, the consolidated of PTG Energy Public Company Limited ( the Company ) and its subsidiaries ( the Group ) and the separate of the Company present fairly, in all material respects, the consolidated and separate financial position of the Group and of the Company as at 31 December 2017, and its consolidated and separate financial performance and its consolidated and separate cash flows for the year then ended in accordance with Thai Financial Reporting Standards ( TFRS ). What I have audited The consolidated and the separate comprise: the consolidated and separate statements of financial position as at 31 December 2017; the consolidated and separate statements of income for the year then ended the consolidated and separate statements of comprehensive income for the year then ended; the consolidated and separate statements of changes in equity for the year then ended; the consolidated and separate statements of cash flows for the year then end; and the notes to the consolidated and separate, which include a summary of significant accounting policies. Basis for opinion I conducted my audit in accordance with Thai Standards on Auditing ( TSA ). My responsibilities under those standards are further described in the Auditor s responsibilities for the audit of the consolidated and separate section of my report. I am independent of the Group and the Company in accordance with the Federation of Accounting Professions under the Royal Patronage of his Majesty the King s Code of Ethics for Professional Accountants together with the ethical requirements that are relevant to my audit of the consolidated and separate, and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key audit matters Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the consolidated and separate of the current period. I determine one key audit matter: Business combination. The matter was addressed in the context of my audit of the consolidated and separate as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on the matter.
Business combination Key audit matter As disclosed in Note 36 - Business Combination, the Group paid cash consideration of Baht 205 million to acquire a 99.98% shareholding interest in GFA Corporation (Thailand) Limited ( GFA ), which engages in food and beverage services. Management assessed that the acquisition of shareholding qualifies as a business combination according to the definition in TFRS 3 (revised 2016) Business Combination. Management engaged a qualified external valuer to appraise the fair value of GFA s assets. The valuer determined that the fair value of the identifiable assets acquired was Baht 202.32 million, mainly comprising Baht 53.34 million relating to equipment and Baht 53.26 million relating to intangible assets (service marks) and the fair value of the liabilities assumed was Baht 50.30 million. The valuation of net identifiable assets acquired was performed as a part of the purchase price allocation. The valuation of the service marks is being done by the management and as of the reporting date the value of the service marks has only been provisionally determined in accordance with TFRS 3. I focused on the identification of the fair value of equipment and service marks arising from the business combination because the valuation methodology and assumptions used in the model involves significant judgment made by management. Key assumptions used to value the equipment included estimated replacement costs adjusted with the remaining useful life and the service marks, included revenue growth rates, royalty rates and discounted rates. How my audit addressed the key audit matter I performed the following procedures in order to obtain evidence of the management s assessment of the business combination and the determination of fair value of the net identifiable assets acquired: Reviewed management's assessment that the acquisitions of 99.98% of shareholding in GFA should be accounted for as business combination. Assessed the appropriateness of the identifiable assets acquired and the liabilities assumed at the acquisition date, and also evaluated management s procedures for determining the fair value of the net identifiable assets acquired. Evaluated the competency, qualifications, experience and independence of management s experts. Tested the calculation of fair values of the equipment and service marks and also challenged management s judgement in relation to the following: - the assumptions used in the fair value estimation of the equipment which comprises estimated replacement costs and remaining useful lives, - the assumption used in the fair value estimation of the service marks which comprises revenue growth rates and royalty rates, and also compared these assumptions to the available public information, and - the discounted rate by assessing the model of the cost of capital and other inputs into the model. As a result of the procedure performed, I determined that the assessment of the acquisition of the investment as business combination is appropriately performed in accordance with the definition set out in TFRS 3 and the assumptions used in identifying the fair values of equipment and service marks were reasonable and in line with the accounting for the business combination.
Other information The directors are responsible for the other information. The other information comprises the information included in the annual report, but does not include the consolidated and separate and my auditor s report thereon. The annual report is expected to be made available to me after the date of this auditor's report. My opinion on the consolidated and separate does not cover the other information and I will not express any form of assurance conclusion thereon. In connection with my audit of the consolidated and separate, my responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the consolidated and separate or my knowledge obtained in the audit, or otherwise appears to be materially misstated. When I read the annual report, if I conclude that there is a material misstatement therein, I am required to communicate the matter to the audit committee. Responsibilities of the directors for the consolidated and separate The directors are responsible for the preparation and fair presentation of the consolidated and separate in accordance with TFRS, and for such internal control as the directors determine is necessary to enable the preparation of consolidated and separate that are free from material misstatement, whether due to fraud or error. In preparing the consolidated and separate, the directors are responsible for assessing the Group s and the Company s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group and the Company or to cease operations, or has no realistic alternative but to do so. The audit committee assists the directors in discharging their responsibilities for overseeing the Group s and the Company s financial reporting process. Auditor s responsibilities for the audit of the consolidated and separate My objectives are to obtain reasonable assurance about whether the consolidated and separate as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with TSA will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated and separate. As part of an audit in accordance with TSA, I exercise professional judgment and maintain professional scepticism throughout the audit. I also: Identify and assess the risks of material misstatement of the consolidated and separate financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group s and the Company s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. Conclude on the appropriateness of the directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group s and the Company s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor s report to the related disclosures in the consolidated and separate or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor s report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the consolidated and separate financial statements, including the disclosures, and whether the consolidated and separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. I am responsible for the direction, supervision and performance of the group audit. I remain solely responsible for my audit opinion. I communicate with the audit committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. I also provide the audit committee with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards. From the matters communicated with the audit committee, I determine those matters that were of most significance in the audit of the consolidated and separate of the current period and are therefore the key audit matters. I describe these matters in my auditor s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. PricewaterhouseCoopers ABAS Ltd. Amornrat Pearmpoonvatanasuk Certified Public Accountant (Thailand) No. 4599 Bangkok 21 February 2018
Statement of Financial Position As at 31 December 2017 2017 2016 2017 2016 Notes Assets Current assets Cash and cash equivalents 7 910,997,936 636,962,412 281,126,037 162,149,383 Short-term investments - Available-for-sale 8 14,999,885 2,745,404-793,499 Trade and other receivables, net 9 994,247,195 675,325,972 519,746,107 434,494,051 Short-term loans to related parties 34.5 - - 3,180,906,353 2,128,840,353 Current portion of long-term loans to third parties 180,000 780,000-600,000 Current portion of long-term loans to related parties 34.6 - - 190,000,000 15,000,000 Inventories, net 10 1,989,033,407 1,525,149,704 290,908,459 255,634,849 Total current assets 3,909,458,423 2,840,963,492 4,462,686,956 2,997,512,135 Non-current assets Deposits at financial institutions used as collateral 11 9,932,444 - - - Long-term loans to third parties, net 2,380,000 2,560,000 - - Long-term loans to related parties, net 34.6 - - 570,000,000 10,000,000 Investments in subsidiaries 12 - - 1,251,394,322 1,177,644,322 Investments in joint ventures 12 696,195,304 644,208,790 704,999,990 640,000,000 Investments in associates 12 803,794,602 757,241,615 20,000,000 - Other long-term investment 13 723,093,785 723,093,785 - - Investment property, net 14 277,819,496 209,407,866 130,002,260 131,685,083 Property, plant and equipment, net 15 8,864,716,242 5,800,009,818 1,894,960,038 1,985,137,724 Prepaid leasehold right and land rental, net 16 2,310,664,144 1,403,511,056 1,833,821 2,319,758 Intangible assets, net 17 193,044,985 79,561,360 134,769,352 72,434,090 Goodwill 52,982,548 - - - Deferred tax assets, net 26 42,049,138 14,171,583 - - Other non-current assets 18 99,245,783 51,842,981 10,581,254 9,438,363 Total non-current assets 14,075,918,471 9,685,608,854 4,718,541,037 4,028,659,340 Total assets 17,985,376,894 12,526,572,346 9,181,227,993 7,026,171,475 Director... Director The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 5
Statement of Financial Position As at 31 December 2017 2017 2016 2017 2016 Notes Liabilities and equity Current liabilities Bank overdrafts from a financial institution 19 519,507,655 306,225,068 - - Trade and other payables 20 4,520,212,444 3,653,628,137 765,858,630 648,049,271 Short-term loans from financial institutions 21 1,600,000,000 500,000,000 - - Short-term loans from related parties 34.7 - - 48,530,900 233,120,900 Current portion of finance lease liabilities, net 22 260,693,086 244,392,348 116,754,651 207,540,627 Current portion of long-term loans from financial institutions 23.1 1,313,266,448 274,678,781 476,886,448 158,068,781 Income tax payable 61,791,201 99,079,184 9,564,099 6,852,492 Total current liabilities 8,275,470,834 5,078,003,518 1,417,594,728 1,253,632,071 Non-current liabilities Finance lease liabilities, net 22 572,412,036 314,039,897 58,509,635 175,264,333 Long-term loans from financial institutions, net 23.1 441,743,823 678,769,270 310,493,823 260,229,270 Debentures, net 24 3,391,806,850 1,691,597,388 3,391,806,850 1,691,597,388 Retirement benefit obligations 25 76,852,881 49,650,399 47,613,477 36,226,252 Deferred tax liabilities, net 26 55,055,253 74,901,873 31,412,234 46,448,027 Other non-current liabilities 27 53,491,972 50,339,185 24,564,307 19,680,910 Total non-current liabilities 4,591,362,815 2,859,298,012 3,864,400,326 2,229,446,180 Total liabilities 12,866,833,649 7,937,301,530 5,281,995,054 3,483,078,251 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 6
Statement of Financial Position As at 31 December 2017 2017 2016 2017 2016 Notes Liabilities and equity (continued) Equity Share capital 28 Authorised share capital - 1,670,000,000 ordinary shares at par value of Baht 1 each 1,670,000,000 1,670,000,000 1,670,000,000 1,670,000,000 Issued and paid-up share capital - 1,670,000,000 ordinary shares paid-up of Baht 1 each 1,670,000,000 1,670,000,000 1,670,000,000 1,670,000,000 Premium on share capital 28 1,185,430,000 1,185,430,000 1,185,430,000 1,185,430,000 Retained earnings Appropriated - Legal reserve 29 116,065,920 81,305,616 116,065,920 81,305,616 Unappropriated 2,171,474,407 1,635,827,602 927,737,019 606,340,366 Other components of equity (38,418,813) 2,684,968-17,242 Total equity attributable to owners of the parent 5,104,551,514 4,575,248,186 3,899,232,939 3,543,093,224 Non-controlling interests 13,991,731 14,022,630 - - Total equity 5,118,543,245 4,589,270,816 3,899,232,939 3,543,093,224 Total liabilities and equity 17,985,376,894 12,526,572,346 9,181,227,993 7,026,171,475 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 7
Statement of Income 2017 2016 2017 2016 Notes Revenue from sales and services 84,624,590,364 64,591,400,891 11,185,535,433 9,352,765,228 Costs of sales and services (78,370,937,171) (59,359,526,420) (10,384,338,573) (8,579,047,818) Gross profit 6,253,653,193 5,231,874,471 801,196,860 773,717,410 Revenue from assets for lease and other services 94,412,436 84,431,559 515,714,141 477,995,122 Dividends income 1,398,556 6,224,448 484,147,691 311,982,020 Other income 142,133,611 112,252,526 184,291,106 158,985,669 Selling expenses (4,475,032,531) (3,356,179,205) (546,814,914) (534,622,305) Administrative expenses (803,462,138) (750,381,926) (571,388,930) (445,631,353) Finance costs (188,441,618) (124,903,770) (126,345,331) (109,418,436) Dilution gains in investment in an associate 12.1-94,454,099 - - Share of profit from investments in joint ventures and associates, net 12.1 42,245,269 37,772,532 - - Profit before income tax 1,066,906,778 1,335,544,734 740,800,623 633,008,127 Income tax 31 (153,832,571) (262,149,172) (45,594,536) (57,396,473) Profit for the year 913,074,207 1,073,395,562 695,206,087 575,611,654 Profit (loss) attributable to: Owners of the parent 913,098,000 1,073,447,288 695,206,087 575,611,654 Non-controlling interests (23,793) (51,726) - - Profit for the year 913,074,207 1,073,395,562 695,206,087 575,611,654 Earnings per share Basic earnings per share 32 0.55 0.64 0.42 0.34 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 8
Statement of Comprehensive Income 2017 2016 2017 2016 Notes Profit for the year 913,074,207 1,073,395,562 695,206,087 575,611,654 Other comprehensive income Item that will not be reclassified to profit or loss - Remeasurements of retirement benefit obligations 25 (10,863,613) - (6,311,413) - - Income tax on item that will not be reclassified 2,172,722-1,262,283 - Total item that will not be reclassified to profit or loss (8,690,891) - (5,049,130) - Items that will be reclassified subsequently to profit or loss - Change in value of available-for-sale financial assets 8 (48,048) 15,780 (17,242) 4,078 - Share of other comprehensive income (expense) of a joint venture and an associate accounted for using the equity method (41,055,733) 2,120,595 - - - Income tax on items that will be reclassified - (172,147) - - Total items that will be reclassified to profit or loss (41,103,781) 1,964,228 (17,242) 4,078 Other comprehensive income (expense) for the year, net of tax (49,794,672) 1,964,228 (5,066,372) 4,078 Total comprehensive income for the year 863,279,535 1,075,359,790 690,139,715 575,615,732 Total comprehensive income attributable to: Owners of the parent 863,303,328 1,075,411,516 690,139,715 575,615,732 Non-controlling interests (23,793) (51,726) - - Total comprehensive income for the year 863,279,535 1,075,359,790 690,139,715 575,615,732 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 9
Statement of Changes in Equity Attributable to owners of the parent Other components of equity Other comprehensive Retained earnings income (expense) Share of other comprehensive Issued and income (expense) Total other paid-up share Premium on Legal Available-for-sale of joint ventures components of Total owners Non-controlling Total capital share capital reserve Unappropriated investments and associates equity of the parent interests equity Notes Baht Baht Opening balance as at 1 January 2016 1,670,000,000 1,185,430,000 52,525,033 1,092,139,190 32,153 688,587 720,740 4,000,814,963 92,261 4,000,907,224 Changes in equity for the year Dividend paid - - - (500,978,293) - - - (500,978,293) (17,980) (500,996,273) Legal reserve 29 - - 28,780,583 (28,780,583) - - - - - - Investment in a subsidiaries of non-controlling interests - - - - - - - - 14,000,075 14,000,075 Total comprehensive income for the year - - - 1,073,447,288 15,780 1,948,448 1,964,228 1,075,411,516 (51,726) 1,075,359,790 Closing balance as at 31 December 2016 1,670,000,000 1,185,430,000 81,305,616 1,635,827,602 47,933 2,637,035 2,684,968 4,575,248,186 14,022,630 4,589,270,816 Opening balance as at 1 January 2017 1,670,000,000 1,185,430,000 81,305,616 1,635,827,602 47,933 2,637,035 2,684,968 4,575,248,186 14,022,630 4,589,270,816 Changes in equity for the year Non-controlling interest arising on business combination 36 - - - - - - - - 15,203 15,203 Dividend paid 33 - - - (334,000,000) - - - (334,000,000) (22,309) (334,022,309) Legal reserve 29 - - 34,760,304 (34,760,304) - - - - - - Total comprehensive income (expense) for the year - - - 904,407,109 (48,048) (41,055,733) (41,103,781) 863,303,328 (23,793) 863,279,535 Closing balance as at 31 December 2017 1,670,000,000 1,185,430,000 116,065,920 2,171,474,407 (115) (38,418,698) (38,418,813) 5,104,551,514 13,991,731 5,118,543,245 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 10
Statement of Changes in Equity Other components of equity Other comprehensive Retained earnings income (expense) Issued and Total other paid-up share Premium on Legal Available-for-sale components of Total capital share capital reserve Unappropriated investments equity equity Notes Baht Baht Baht Opening balance as at 1 January 2016 1,670,000,000 1,185,430,000 52,525,033 560,487,588 13,164 13,164 3,468,455,785 Changes in equity for the year Dividend paid - - - (500,978,293) - - (500,978,293) Legal reserve 29 - - 28,780,583 (28,780,583) - - - Total comprehensive income for the year - - - 575,611,654 4,078 4,078 575,615,732 Closing balance as at 31 December 2016 1,670,000,000 1,185,430,000 81,305,616 606,340,366 17,242 17,242 3,543,093,224 Opening balance as at 1 January 2017 1,670,000,000 1,185,430,000 81,305,616 606,340,366 17,242 17,242 3,543,093,224 Changes in equity for the year Dividend paid 33 - - - (334,000,000) - - (334,000,000) Legal reserve 29 - - 34,760,304 (34,760,304) - - - Total comprehensive income for the year - - - 690,156,957 (17,242) (17,242) 690,139,715 Closing balance as at 31 December 2017 1,670,000,000 1,185,430,000 116,065,920 927,737,019 - - 3,899,232,939 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 11
Statement of Cash Flows 2017 2016 2017 2016 Notes Cash flows from operating activities Profit before income tax for the year 1,066,906,778 1,335,544,734 740,800,623 633,008,127 Adjustments to reconcile profit before income tax to net cash provided by operations: - Depreciation and amortisation 30 1,811,279,323 1,288,924,038 174,215,496 169,150,015 - Amortisation of deferred financing fee 4,054,462 3,149,400 4,054,462 3,149,400 - Provision for decommissioning costs 351,976 754,517 113,195 621,049 - (Reversal of) allowance for doubtful accounts, net 3,541,943 (5,803,711) 499,479 (6,168,924) - Revenue from dividend income (1,398,556) (6,224,448) (484,147,691) (311,982,020) - Retirement benefit expenses 16,682,698 9,162,953 5,842,420 5,506,206 - Gains on disposals of assets (822,303) (6,077,013) (7,401,131) (8,610,446) - Loss on write-off of assets 15, 17 9,049,260 10,837,524 98,967 1,719,547 - Gains on disposals of short-term investments (65,288) (56,989) (23,650) (56,989) - (Reversal of) impairment charge of assets 14, 15 2,646,923 (12,683,689) - (12,683,689) - Reversal of allowance for decrease in inventory value and obsolescence 1,055,186 (5,026,218) 253,599 (4,363,248) - Interest income (7,799,615) (1,122,199) (110,637,743) (94,894,875) - Interest expenses 294,432,759 117,632,237 122,290,870 106,269,036 - Dilution gains in investment in an associate 12.1 - (94,454,099) - - - Share of profit from investments in joint ventures and associates, net 12.1 (42,245,269) (37,772,532) - - Cash flows before changes in operating assets and liabilities 3,157,670,277 2,596,784,505 445,958,896 480,663,189 Changes in operating assets and liabilities: - Trade and other receivables (135,051,427) 3,439,865 (25,625,094) 240,053,978 - Inventories (445,928,029) (537,182,304) (35,527,209) 15,920,976 - Other non-current assets (13,091,034) (10,688,637) (1,142,891) (4,328,784) - Trade and other payables 774,989,019 1,514,830,723 101,557,194 68,017,757 - Retirement benefit obligations paid 25 (892,624) - (54,046) - - Other non-current liabilities (1,993,187) 15,746,942 4,770,203 1,373,366 Cash generated from operations 3,335,702,995 3,582,931,094 489,937,053 801,700,482 - Interest received 7,799,617 1,122,199 50,511,511 64,592,250 - Interest paid (291,436,029) (117,185,969) (119,585,749) (98,835,680) - Income tax paid (262,158,921) (241,795,121) (56,656,439) (50,043,278) Net cash receipts from operating activities 2,789,907,662 3,225,072,203 364,206,376 717,413,774 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 12
Statement of Cash Flows 2017 2016 2017 2016 Notes Cash flows from investing activities Payments for deposits at financial institutions used as collateral (6,560,000) - - - Payments for leasehold right and land rental 16 (1,926,441,622) (1,335,212,340) (273,685) (252,579) (Payments for) proceeds from short-term investments, net (12,237,241) 400,000 799,907 400,000 Payments for purchases of invesment property (70,373,678) (41,642) (601,127) - Payments for purchases of property, plant and equipment (3,327,131,237) (1,841,273,277) (273,666,489) (209,922,043) Proceeds from disposals of plant and equipment 11,110,525 77,712,278 219,100,297 77,702,750 Payments for purchases of intangible assets (70,029,874) (42,139,641) (68,626,872) (39,013,368) Dividends received 27,298,556 6,224,448 484,147,691 311,982,020 Proceeds from short-term loans to related parties 34.5 99,777,600-20,522,568,600 16,586,306,210 Payments for short-term loans to related parties 34.5 (99,777,600) - (21,574,634,600) (17,494,355,500) Proceeds from long-term loans to related parties 34.6 - - 15,000,000 15,000,000 Payments from long-term loans to related parties 34.6 - - (750,000,000) - Proceeds from a short-term loan to a third party - 1,000,000 - - Proceeds from a long-term loan to a third party 780,000 780,000 600,000 600,000 Acquisition of investments in subsidiaries, net cash acquired 12.1, 36 (201,342,043) - (73,750,000) (577,250,000) Acquisition of investments in joint ventures 12.1 (64,999,990) (291,200,000) (64,999,990) (291,200,000) Acquisition of investments in associates 12.1 (58,249,975) (621,600,000) (20,000,000) - Acquisition of other long-term investment 13 - (723,093,785) - - Net cash payments in investing activities (5,698,176,579) (4,768,443,959) (1,584,336,268) (1,620,002,510) Cash flows from financing activities Payments for finance leases (280,878,940) (277,405,301) (207,540,674) (262,273,124) Proceeds from bank overdrafts from a financial institution, net 199,988,470 119,157,229 - - Proceeds from short-term loans from financial institutions 21,300,000,000 6,300,000,000 - - Payments of short-term loans from financial institutions (20,200,500,000) (5,800,000,000) - - Proceeds from short-term loans from related parties 34.7 - - 1,151,629,000 1,694,637,000 Payments of short-term loans from related parties 34.7 - - (1,336,219,000) (1,689,844,500) Proceeds from long-term loans from financial institutions 1,200,000,000 491,400,000 600,000,000 200,000,000 Payments of long-term loans from financial institutions (398,437,780) (147,652,114) (230,917,780) (91,402,114) Proceeds from debentures 1,700,000,000 1,700,000,000 1,700,000,000 1,700,000,000 Payments on deferred financing fee (3,845,000) (11,552,012) (3,845,000) (11,552,012) Dividends paid to shareholders 33 (334,000,000) (500,978,293) (334,000,000) (500,978,293) Dividends paid to non-controlling interests of subsidiaries (22,309) (17,980) - - Proceeds from paid-up shares of subsidiaries from non-controlling interests - 14,000,075 - - Net cash receipts from financing activities 3,182,304,441 1,886,951,604 1,339,106,546 1,038,586,957 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 13
Statement of Cash Flows 2017 2016 2017 2016 Net increase in cash and cash equivalents 274,035,524 343,579,848 118,976,654 135,998,221 Beginning balance 636,962,412 293,382,564 162,149,383 26,151,162 Ending balance 910,997,936 636,962,412 281,126,037 162,149,383 Cash and cash equivalents are made up as follows: - Cash on hand and deposits at financial institutions - maturities within three months 910,997,936 636,962,412 281,126,037 162,149,383 910,997,936 636,962,412 281,126,037 162,149,383 Non-cash transactions - Purchases of investment property by payables 4,080,756 243,967 - - - Purchases of plant and equipment by payables 185,679,371 122,436,507 9,734,638 3,930,539 - Purchases of equipment under finance lease agreements 555,551,817 188,469,190-1,637,756 - Purchases of intangible assets by payables 14,203,575 7,173,190 14,203,575 7,173,190 The accompanying notes on pages 15 to 72 are an integral part of these consolidated and separate. 14
1 General information PTG Energy Public Company Limited (the Company ) is a public limited company, incorporated and resident in Thailand. The address of its registered office is 90, CW Tower A Building, 33rd Floor, Ratchadapisek Road, Huay Kwang, Bangkok. The Company is listed on the Stock Exchange of Thailand. For reporting purposes, the Company and its subsidiaries are referred to as the Group. The Group engages in business of trading of petroleum products, gas product, supplies and equipment for oil service station and consumable products and transportation. These consolidated and separate were authorised for issue by the Board of Directors on 21 February 2018. 2 Accounting policies The principal accounting policies adopted in the preparation of these consolidated and separate are set out below. 2.1 Basis for preparation The consolidated and separate have been prepared in accordance with Thai generally accepted accounting principles under the Accounting Act B.E. 2543, being those Thai Accounting Standards issued under the Accounting Professions Act B.E. 2547, and the financial reporting requirements of the Securities and Exchange Commission under the Securities and Exchange Act. The have been prepared under the historical cost convention except as disclosed in the accounting policies below. The preparation of in conformity with Thai generally accepted accounting principles requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group s accounting policies and to disclose the areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the as disclosed in Note 4. An English version of the has been prepared from the statutory that are in the Thai language. In the event of a conflict or a difference in interpretation between the two languages, the Thai language statutory shall prevail. 2.2 Revised financial reporting standards and accounting standards and related interpretations (collectively the accounting standards ) 2.2.1 The accounting standards are effective for accounting periods beginning on or after 1 January 2017 The Group adopted the accounting standards, which are effective for accounting period beginning on or after 1 January 2017. There is no significant impact to the being present from the adoption of those standards by the Group. 15
2 Accounting policies (continued) 2.2 Revised financial reporting standards and accounting standards and related interpretations (collectively the accounting standards ) (continued) 2.2.2 The accounting standards are effective for accounting periods beginning on or after 1 January 2018 and not early adopted by the Group TAS 7 (revised 2017) TAS 12 (revised 2017) TFRS 12 (revised 2017) Statement of cash flows Income taxes Disclosure of interests in other entities TAS 7 (revised 2017), the amendments require additional disclosure of changes in liabilities arising from financing activities. This includes changes arising from cash and non-cash. TAS 12 (revised 2017), the amendments clarify the accounting for deferred tax where an asset is measured at fair value and that fair value is below the asset s tax base. Specifically, the amendments confirm that: A temporary difference exists whenever the carrying amount of an asset is less than its tax base at the end of the reporting period. An entity can assume that it will recover an amount higher than the carrying amount of an asset to estimate its future taxable profits. Where the tax law restricts the source of taxable profits against which particular types of deferred tax assets can be recovered, the recoverability of the deferred tax assets can only be assessed in combination with other deferred tax assets of the same type. Tax deductions resulting from the reversal of deferred tax assets are excluded from the estimated future taxable profits. TFRS 12 (revised 2017), the amendments clarify that the disclosure requirements of TFRS 12 apply to interests in entities that are classified as held for sale according to TFRS 5 (revised 2017), except for the summarised financial information. The Group s management has assessed and considered that the above revised standards will not have a material impact on the Group except for disclosure. 2.3 Group accounting - investments in subsidiaries and associates and in joint arrangements 2.3.1 Subsidiaries Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns though its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. The Group applies the acquisition method to account for business combinations except business combination under common control. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred to the former owners of acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest s proportionate share of the acquiree s net assets. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measured are recognised in profit or loss. Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in profit or loss. Contingent consideration that is classified as equity is not re-measured, and its subsequent settlement is accounted for within equity. 16
2 Accounting policies (continued) 2.3 Group accounting - investments in subsidiaries and associates and in joint arrangements (continued) 2.3.1 Subsidiaries (continued) The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired is recorded as goodwill. If the total of consideration transferred, non-controlling interest recognise and previously held interest measured is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in profit or loss. Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed to ensure consistency with the policies adopted by the Group. A list of the Group s subsidiaries is shown in Note 12. 2.3.2 Transactions with non-controlling interests The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity. 2.3.3 Disposal of subsidiaries When the Group ceases to have control it shall ceased to consolidate its subsidiaries. Any retained interest in the entity is re-measured to its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. 2.3.4 Associates Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. In the consolidated, investments in associates are accounted for using the equity method of accounting. A list of the Group s a principal associate is shown in Note 12. 2.3.5 Joint arrangements Investments in joint arrangements are classified as either joint operations or joint ventures depending on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangements. Joint operations A joint operation is a joint arrangement whereby the Group has rights to the assets, and obligations for the liabilities relating to the arrangement. The Group recognises its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses. These have been incorporated in the under the appropriate headings. Joint venture A joint venture is a joint arrangement whereby the Group has rights to the net assets of the arrangement. In the consolidated, interests in joint ventures are accounted for using the equity method. A list of the Group s a principal joint venture is shown in Note 12. 17
2 Accounting policies (continued) 2.3 Group accounting - investments in subsidiaries and associates and in joint arrangements (continued) 2.3.6 Accounting under equity method Under the equity method, the investment is initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor s share of the profit or loss of the investee after the date of acquisition. The Group s investment in associates and joint ventures includes goodwill identifies on acquisition. If the ownership interest in associates and joint ventures is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate. Profit or loss from reduce of the ownership interest in an associates and joint ventures is recognised in profit or loss. The Group s share of its associates and joint ventures post-acquisition profits or losses is recognised in the profit or loss, and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group s share of losses in associates and joint ventures equals or exceeds its interest in the associates and joint ventures, together with any long-term interests that, in substance, form part of the entity s net investment in the associates or joint ventures, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associates and joint ventures The Group determines at each reporting date whether there is any objective evidence that the investments in the associates and joint ventures are impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the investments and its carrying value and recognises the amount adjacent to share of profit (loss) of associates and joint ventures in profit or loss. Unrealised gains on transactions between the Group and its associates and joint ventures are eliminated to the extent of the Group s interest in the associates and joint ventures. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates and joint ventures have been changed where necessary to ensure consistency with the policies adopted by the Group. 2.3.7 In the separate, investments in subsidiaries, associates and joint ventures are accounted for at cost less impairment. Cost is adjusted to reflect changes in consideration arising from contingent consideration amendments. Cost also includes direct attributable costs of investment. A test for impairment for investments in subsidiaries, associates and joint ventures is carried out when there is a factor indicating that investments might be impaired. If the carrying value of the investments is higher than its recoverable amount, impairment loss is charged to the profit or loss. 2.4 Foreign currency translation 2.4.1 Functional and presentation currency Items included in the of each of the Group s entities are measured using the currency of the primary economic environment in which the entity operates ( the functional currency ). The are presented in Baht, which is the functional of the Company and presentation currency of the Group. 2.4.2 Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. When a gain or loss on a non-monetary item is recognised in other comprehensive income, any exchange component of that gain or loss is recognised in other comprehensive income. Conversely, when a gain or loss on a non-monetary item is recognised in the profit or loss, any exchange component of that gain or loss is recognised in the profit or loss. 18
2 Accounting policies (continued) 2.4 Foreign currency translation (continued) 2.4.3 Group companies The results and financial position of all the Group s entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: - Assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position; - Income and expenses of each statement of income and statement of comprehensive income are translated at average exchange rates; and - All resulting exchange differences are recognised as other comprehensive income in the statement of comprehensive income. Goodwill and fair value adjustments arising from the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate. 2.5 Cash and cash equivalents In the consolidated and separate statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions and other short-term highly liquid investments with original maturities of three months or less. In the consolidated and separate statement of financial position, bank overdrafts are shown in current liabilities. 2.6 Investments Investments other than investments in subsidiaries, an associate and a joint venture are classified into three categories: trading investments, available-for-sale investments and other long-term investments. The classification is dependent on the purpose for which the investments were acquired. Management determines the appropriate classification of its investments at the time of the purchase and re-evaluates such designation on a regular basis. 2.6.1 Trading investments Investments that are acquired principally for the purpose of generating a profit from short-term fluctuations in price are classified as trading investments and included in current assets. 2.6.2 Available-for-sale investments Investments intended to be held for an indefinite period of time, which may be sold in response to liquidity needs or changes in interest rates, are classified as available-for-sale; and are included in non-current assets unless management has expressed the intention of holding the investment for less than 12 months from the statement of financial position date or unless they will need to be sold to raise operating capital, in which case they are included in current assets. 2.6.3 Other long-term investment Investment in non-marketable equity security is classified as other long-term investment. All categories of investment are initially recognised at cost, which is equal to the fair value of consideration paid plus transaction cost. Trading investments and available-for-sale investments are subsequently measured at fair value. The fair value of investments is based on quoted bid price at the close of business on the statement of financial position date by reference to a published price. The unrealised gains and losses of trading investments are recognised in profit or loss. The unrealised gains and losses of available for sale investments are recognised in other comprehensive income. Other long-term investment is carried at cost less impairment loss. A test for impairment is carried out when there is a factor indicating that an investment might be impaired. If the carrying value of the investment is higher than its recoverable amount, impairment loss is charged to profit or loss. 19
2 Accounting policies (continued) 2.7 Trade receivables Trade receivables are carried at the original invoice amount and subsequently measured at the remaining amount less any allowance for doubtful accounts based on a review of all outstanding amounts at the year-end. The amount of the allowance is the difference between the carrying amount of the receivables and the amount expected to be collectible. Bad debts are written-off during the year in which they are identified and recognised in profit or loss within administrative expenses. 2.8 Inventories Inventories are stated at the lower of cost or net realisable value. Cost is determined under the following methods: Petroleum products Consumable products Other products Moving average method Weighted average method Weighted average method The cost of purchase comprises both the purchase price and costs directly attributable to the acquisition of the inventory, such as import duties and transportation charges, less all attributable discounts, allowances or rebates. Net realisable value is the estimate of the selling price in the ordinary course of business, less applicable selling expenses. Allowance is made, where necessary, for obsolete, slowmoving and defective inventories. 2.9 Investment property Property that is held for long-term rental or for capital appreciation or both, and that is not occupied by the Group, is classified as investment property. Investment property also includes property that is being constructed or developed for future use as investment property or land held for a currently undetermined future use. Investment property of the Group is land and land improvement and building and building improvement held for earning rentals and for a currently undetermined future use. The Group has not determined whether it will use the land and land improvement and building and building improvement as owner-occupied property or as capital appreciation. Land and land improvement are not depreciated. Depreciation on building and building improvement is calculated using the straight line method to allocate their cost to their residual values over their estimated useful lives which is 10-40 years. Investment property is measured initially at its cost including related transaction costs. Subsequently, the investment property is carried at cost less accumulated depreciation and accumulated impairment (if any). Subsequent expenditure is capitalised to the asset s carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. 20