TRUE : Annual Report 2004

2 _√“¬ß“πª√–®”ªï2547_∫√‘…—∑ ∑√Ÿ §Õ√åªÕ‡√™—Ëπ ®”°—¥

(¡À“™π)

Financial Highlights................................................................................................................................................................ 12

Message from the Chairman of the Board...........................................................................................................................14

Message from the President and CEO.........................................................................................................................................16

Products and Services...........................................................................................................................................................18

Community Program..............................................................................................................................................................22

Independent Directors............................................................................................................................................................23

Corporate Governance Report...............................................................................................................................................27

Company Background and Major Developments..................................................................................................................34

Awards...................................................................................................................................................................................36

Revenues Breakdown by Business Group............................................................................................................................37

Corporate Information........................................................................................................................................................... 38

References.............................................................................................................................................................................43

Group of Investment Structure..............................................................................................................................................44

Risk Factors...........................................................................................................................................................................45

Shareholders..........................................................................................................................................................................47

Dividend Policy.......................................................................................................................................................................48

Management..........................................................................................................................................................................49

Connected Transactions........................................................................................................................................................82

Audit Fees..............................................................................................................................................................................83

Report of the Audit Committee for the Year 2004...............................................................................................................84

Report of the Board of Directorsû Responsibilities for Financial Statements 2004 .............................................................85

Managementûs Discussion and Analysis................................................................................................................................86

Financial Statements..............................................................................................................................................................93

3√“¬ß“πª√–®”ªï2547_∫√‘…—∑ ∑√Ÿ §Õ√åªÕ‡√™—Ëπ ®”°—¥ (¡À“™π)_

Fun doesnût really come from playing with toys,it comes from playing together.

TrueFun

TrueSuccess When we have each other, the task is already half done.

12 ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED

Consolidated Financial ResultsTotal revenues 33,010 27,950 25,783

EBITDA (normalized) 1/ 13,164 11,642 9,798

Operating profit 2/ 1,379 491 521

Net profit (loss) 605 (5,674) (5,395)

Consolidated Balance Sheets and Cash FlowsTotal assets 102,625 86,760 92,977

Total liabilities 97,888 85,265 85,779

Total shareholderûs equity 4,738 1,495 7,198

Free cash flow 3/ 3,419 (3,303) (4,298)

Free cash flow, excluding TA Orange 3/ 6,231 5,162 4,682

Key Financial and Efficiency RatiosEBITDA margin 39.9% 41.7% 38.0%

Operating profit margin 4.2% 1.8% 2.0%

Asset Turnover 32.2% 32.2% 27.7%

EBITDA / Interest coverage ratio (Times) 3.1 2.6 2.5

Net debt / EBITDA (Times) 6.0 5.9 6.6

EBITDA / Interest coverage ratio, excluding TA Orange (Times) 3.6 3.1 3.2

Net debt / EBITDA, excluding TA Orange (Times) 4.3 4.7 5.1

Per Share Data and OthersLoss per share (Baht) 4/ (0.03) (2.13) (2.34)

Book value per share (Baht) 1.16 0.40 1.95

Share price at year end (Baht) 8.10 7.30 4.60

No. of outstanding shares at year end (Million shares) 4,092.53 3,694.50 3,694.50

Market capitalization 33,149.47 26,969.83 16,994.70

2004 2003 2002

(Unit : Million Baht)

1/ Excluding one-off transactions which consisted of the followings;

- out-of-period booking of leased circuit and conduit rental of Baht 286 million in 2002,

- one-time compensation of Baht 33 million for workforce reduction in 2002.

2/ Excluding one-time write-off for PCT subscriber acquisition cost of Baht 215

million in 2003.

3/ Cash flow from operations less capital expenditure.

4/ After accumulated dividend for preferred shares.

12ANNUAL REPORT 2004 TRUE CORPORATION PUBLIC COMPANY LIMITED

No.1 Broadband and Internet player

Consumer BroadbandInternet

Bt Mn.

4

165

888

1,231

1

2004

26.7%

0.7%

5.2%

4.0%

53.4%

TA Orange contribution*

Revenue (Bt Mn) Revenue (Bt Mn)Users (,000) Subscribers (,000)

Revenue Diversification

High growth businesses contributed 37% of service revenue in FY 2004 compared to 17% in FY 2002.

Orange

Data/Broadband/Internet

WE PCT

Others

Wireline

Key Growth Drivers

TA Orange surging growth

Remark : * Based on a proportionate consolidation up to 3Q04,

and changed to full consolidation since 4Q04.

Revenue (Bt Mn) Subscribers (,000)

Remark : Data/Broadband/Internet group refers to DDN,

Multimedia and Internet segments in the audited financial

statements.

13


Mr. Dhanin ChearavanontChairman of the Board

Our 2004 results showour transformation

has been a success,our strategy is workingand most importantly

we are deliveringwhat consumers want.

In 2005 we will build onwhat we have achievedand continue producing

high quality and innovativecommunications

solutions that enrich ourcustomersû lives.

If we can maintainthis focus, which I am

confident we can,we will be in a goodposition to prosper

further as theThai telecommunications

industry is liberalized.


Telecommunication usage and competition continued to increase in Thailand in 2004, especially in the mobile and

Internet sectors. Total Internet penetration jumped from 9 percent to 11 percent, with Broadband use, although still relatively

small, surging by more than 13 folds.

Mobile phone penetration also continued its steady rise, increasing from 34 percent to 41 percent of the population, and

for the first time large numbers of Thai consumers started enjoying the benefits of non-voice mobile services, such as

downloadable financial information, games and photo-based communication and community services. And as Thai appetites

for high-speed connectivity and convenient lifestyle services grew during the year, I am proud that True has been at the

forefront of meeting these needs.

In 2003 and 2004 we made major organizational and other changes to ensure we were strategically well placed to drive

emerging trends. The biggest change was our decision to establish ourselves under a new brand, as well as strengthen

ourselves both technically and financially so that we could become Thailandûs leading customer-focused total communications

solutions provider. Subsequent brand campaigns, conducted both externally and internally during the year were designed to

leverage on synergies within the True Group and enhance our ability to serve in ways that matter the most to our

customers by enhancing their life styles.

Our 2004 results show our transformation has been a success, our strategy is working and most importantly we are

delivering what consumers want. In 2005 we will build on what we have achieved and continue producing high quality and

innovative communications solutions that enrich our customersû lives. If we can maintain this focus, which I am confident we

can, we will be in a good position to prosper further as the Thai telecommunications industry is liberalized.

the Chairman of the Boardfrom


The True Group ended 2004 stronger than ever before. All aspects of our business were strengthened and foundations

were laid for continuing future growth. True has become Thailandûs largest Internet Service Provider, its largest Broadband

operator and Thailandûs most integrated communications solutions provider. Across the Group debt was reduced and

restructured in 2004, equity was increased, cash flow and revenue remained strong and strategies were put in place to

stabilize and enhance core businesses.

TA Orange, our mobile phone subsidiary, had a particularly good year. It launched a wide range of non-voice services,

beat expectations by almost doubling subscribers, and is firmly on track to make a maiden profit in 2006. With True taking

a majority shareholding in TA Orange and negotiating new long term financing, the challenge now is to fully integrate TA

Orange into the True Group and leverage synergies between it and other subsidiaries so that we can offer a whole new range

of integrated solutions that enhance customer lifestyles.

A key aspect of this will be the development of more high-speed content and the bundling of products and services into

customized packages with single billing. Achieving this will be challenging as we are likely to face more intense competition

than ever before. But I am confident that with the progress made in 2004, the leadership attained in key markets, and our

proven ability to adapt and innovate, we will maintain momentum.

I would like to extend my thanks to shareholders, members of the Board, management and all True Group staff for their

dedication and hard work during the year. I hope you all feel as I do that the best is yet to come.

the President and CEOfrom


President and CEO

I would like toextend my thanksto shareholders,

members of the Board,management andall True Group stafffor their dedication

and hard workduring the year.

I hope you all feelas I do

that the bestis yet to come.

Mr. Supachai Chearavanont


At home, on the move, in the office or factory our customers want convenient, fast and cost effective ways to stay

connected that enhance their life and work styles. In 2004 we continued to meet the lifestyle and commercial needs of this

diverse group by launching a wide range of innovative and affordable solutions using a number of channels.

Business Solutions

For our business customers, fast and reliable communications are a commercial life blood and a vital means to grow

revenue, reduce expenses and reach out to more customers. With this in mind we opened the True Internet Data Centre

(True IDC) in mid-2004 to provide businesses with convenient access to the full range of Internet services, including

web hosting, web-based monitoring and secure and efficient data storage.

True IDC, which is a joint venture with Korean Company Dacom Corporation and KIDC, the biggest IDC operator in

Asia, provides Thai businesses with the tools to face increased competition at home and abroad and access to cutting edge

Internet solutions to drive business growth.



For our small and medium enterprise customers (SMEs) we launched the çAll in One Solutioné after research showed

some Thai SMEs lacked understanding of how to use technology to increase productivity. The SME All in One Solution by True

- the first total solution for SMEs in Thailand - is a package of four bundled product and service solutions that take care of

all an SMEûs communications, marketing, business process and ICT for office and business management needs. SMEs can

choose one customized solution to meet their needs or sign up for all four and receive full support from a team of True ICT

professionals. We also launched a çPlug and Playé variation of the çAll in One Solutioné for industrial estate SMEs.

Home/Consumer Solutions

Home consumers have greatly benefited from our year-long launch of low-cost unlimited high-speed local and international

Internet access packages. In January we offered unlimited high-speed local Internet packages starting from Baht 550 per

month and in July we launched unlimited local and international Internet packages starting from Baht 590 a month (with a free

fixed line number) with access speeds up to 4 Mbps (mega-bits per second) - the highest speed ever offered in Thailand.

In October we launched another high-value Internet promotion, high speed access with a free ADSL modem and waived

access fee. Following by special service for Internet fans, including çTurbo on Demandé - express 2 Mbps Internet access

with rates charged for actual minutes used. We also announced that in the first half of 2005 we, along with pay TV operator

UBC, would be the first in Thailand to offer an ADSL Broadband television service which will allow users to view their choice

of a diverse range of programs on a computer whenever they want.

True also rolled out a range of innovative services using other channels and product platforms.

For fixed line customers we launched new flexible tariff packages in January 2004 which offered different calling plans

with call rates from Baht 1.5 to Baht 2.75 per minute and a set amount of talk time.

In February we launched the çPCT School Club,é a service that allows group members including teachers and students

to make unlimited calls between themselves using a special number for a fixed monthly charge. In September we renamed

PCT, çWE PCTé to reflect the strategy of building communities and bringing people together, and launched unlimited group

call and a çbuy-one, get one freeé handset promotions.

We also boosted our online game content. In January True Digital Entertainment began offering PristonTale, an award

winning Korean online game. In September we formed the joint venture company NC True with NCsoft, Koreaûs leading

developer and publisher of online games, to provide online games (MMORPG) starting with the most popular worldwide

MMORPG, çLineage IIé in Thailand.



In May we launched çHome Entertainment by Trueé, an online music service provided via high-speed Internet in

association with R.S. Promotions, an entertainment provider. In November we also joined hands with R.S. Promotions again

to add çKaraoke-on-Demand and Moviesé to our suite of çHome Entertainment by Trueé products obtainable via high-speed

Internet.

During 2004 True also maintained its position as Thailandûs leading Wi-Fi hotspot provider. Wi-Fi by True uses the latest

wireless communication technology and provides data transmission at speeds of up to 11 Mbps. By the end of 2004 we had

altogether - the highest amongst Wi-Fi players, 80 Wi-Fi hotspots in places such as convention centers, hospitals, and food

and coffee outlets. We plan to increase the number of Wi-Fi Internet service areas or hotspots from 80 to more than 300 in

2005.

TA Orange

During the year our mobile subsidiary TA Orange delivered on promises to be the best mobile operator in Bangkok; the

best for value, fun and games, the best for convenience and fixed-mobile-Internet integration and the fairest and most

competitive player.

In April, TA Orangeûs network was rated çBest in Bangkoké in a survey conducted by Synovate Ltd, under the guidance

of a testing team from King Mongkutûs Institute of Technology. Aided by a large marketing campaign, public awareness of

the quality of the companyûs network steadily increased.

During the year TA Orange leveraged on synergies with the True Group to emphasize the enhanced convenience and

benefits of using a wide range of True services. In April 2004, TA Orange and True unveiled the çAll Together Bonusé

campaign, which provided customers with free TA Orange talk time for every Baht they spent on home telephone, WE PCT,

Click Internet, Easy Internet and hi-speed Internet services. By the end of 2004, more than 200,000 customers had benefited

from this çbest for valueé promotion.

TA Orange led the market during the year with a steady stream of innovative pricing campaigns, including the çJust Talké

1 Baht per minute promotion, which other operators tried to match. It also launched a range of voice and non-voice content

services to enhance customerûs lifestyles. Three mobile phone community content products were unveiled during the first half

of 2004. In February, TA Orange launched çPhoto Worldé a complete suite of photo-based çfun and gamesé communication

and community services.


In May it launched çFinancial Worldé, which brings together a range of information services to meet the needs of Thai

investors and in July TA Orange launched çGame Worldé, a complete games portal which allows customers to download

mobile games via GPRS from the multimedia service portal çOrange Worldé.

This was followed in October with the launch of çToon Worldé which enables customers to download games, cartoons,

screen savers and ring tones featuring well known cartoon characters. Also in October TA Orange signed a partnership

contract with Koreaûs SK Telecom for non-voice platform and marketing expertise, so it can develop even more innovative

information and çfun and gamesé non-voice products in 2005.

TA Orange also launched the exclusive çTodsaguné online game, joined forces with Workpoint Entertainment Public Company Limited

to offer consumers the game çTodsagun on Mobileé and linked up with Asiasoft International, the authorized provider of the

popular online game Ragnorak, to allow Just Talk customers to play the game on their mobile phones.

In addition, convenient new ways were introduced for Just Talk prepaid customers to top up their mobile phones,

including çMobile Top Upé, which lets customers transfer prepaid credits from one mobile phone to another and çHome Top

Upé, in which customers can use their True fixed-line account to top up their mobile phone. TA Orange also made top-up

e-vouchers available via 7-Eleven stores nationwide and launched micro (Baht 50 and Baht 90) top-up cards.

International SMS, which allows customers to send an International SMS to 447 mobile phone networks in 123

countries worldwide, was also launched and TA Orange and True unveiled Thailandûs first Voice SMS service that lets users

send audio messages to any mobile or fixed-line phone in Thailand.

In November, TA Orange and True revolutionized mobile connectivity for Thai consumers with the launch of Thailandûs

first combined Wi-Fi/GPRS package, which provides unlimited access to high speed data services at a flat monthly rate with

a single monthly bill.


TRUE Learning Center: Gateway to the Wide WorldIn line with the companyûs brand name change in 2004 to TRUE Corporation Public Company Limited, TelecomAsiaûs

learning center also took on a new identity - çTRUE Learning Center: Gateway to the Wide Worldé, embodying the companyûscorporate culture and values which focus on courageous, caring, credible and creative.

During the year, TRUE had implemented numerous projects as part of its ongoing commitment to develop Thailand into aknowledge-based society. As a continuation of its Information Communication Technology (ICT) project which was implementedin 2001, TRUE selected 20 pilot schools with a high potential and then developed them further into an ICT Learning Center.Subsequently, this was then expanded into a network comprising 100 public as well as private schools in the Greater BangkokMetropolitan Area. Likewise, TRUEûs Science Project saw an expansion from 9 selected pilot schools into a network of 60 schoolsin the same area.

Besides the above, TRUE had also organized many educational activities during 2004:ë Science Camp, which took place in the 9 pilot schools, serving as a model to be adopted by other schoolsë Support and development of educational media which was co-produced by teachers and young students.ë Encourage the use ICT knowledge as an educational tool and information search utilizing internet, which would in turn become the knowledge foundation for the ICT community.

TRUE Science-ICT CampThis camp was held at King Mongkutûs Institute of Technology Ladkrabangûs Faculty of Science and was attended by over

300 students and teachers. The emphasis of the camp was to educate the participants on science hand in hand with ICT. Inaddition, a TRUE Nature-Culture camp was also held for over 150 participants educating them on nature and the way of life inthe Bang Khunthien forest which is Bangkokûs only seafront area.

TRUE Young Scientist ProgramThis yearûs project received as many as 360 science projects from primary school students nationwide, representing a record

number of submissions since its establishment in 1993. During its 8-year history, 2 gold medals for the first time were awardedto school children in the provinces.

TRUE Conservation Photo ContestIn its 10

th year, this popular project received a total of 899 submissions. In addition, the consolation prizes were increased

from 10 to 20 in both the wild animals and wild flora categories, bringing the total number of prizes to 46.

TRUE is committed to the ongoing development of Thailand into a knowledge-based society and at the same time aspiresto create inspiration for the Thai people for self-development to become a valuable citizen.



Educa t i o nHonorary Master Degree of Economics,

Thammasat University

Expe r i e nce

1998-Present Independent Director

True Corporation Public Company Limited

Present Chairman

Advanced Agro Public Company Limited

Chairman

Prida Pramote Company Limited

Chairman

Thanakorn Vegetable Oil Products Company

Chairman

Surabangyikhan Company Limited

Chairman

Thai Beverage Can Limited

Chairman

Eastern Seaboard Industrial Estate (Rayong)

Company Limited

Mr . Na rong S r i sa -anIndependent Director

Present Chairman

Thai Alcohol Public Company Limited

Chairman of Executive Board

Siam Food Products Public Company

Limited

Chairman of Executive Board

Beer Thai (1991) Public Company Limited

Vice Chairman

Berli Jucker Public Company Limited

Vice Chairman

General Tobacco Company Limited

Vice Chairman

Thai Beverages Public Company Limited

Executive Director

Comlink Company Limited



Educa t i o nMaster Degree of Laws,

Harvard University, U.S.A.

Master Degree of Arts,

University of Cambridge, London

Bachelor of Laws,

University of Cambridge, London

English Barrister,

Grayûs Inn Association

Expe r i e nce

1998-Present Independent Director and

Chairman of the Audit Committee


Chairman

K Line (Thailand) Company Limited and

its subsidiaries

1991-1992 Permanent Secretary of the Ministry of

Foreign Affairs

Mr . V i t t h y a Ve j j a j i v aIndependent Director andChairman of the Audit Committee

1988 Ambassador Extraordinary and

Plenipotentiary of the

United States of America


Plenipotentiary of

Belgium and the European Community


Plenipotentiary of Canada

1979 Director, General of Department of

Economic Affairs


Educa t i o nDoctorate of Engineering,

University of London, England

Bachelor of Engineering,

University of London, England

Expe r i e nce

1999- Present Independent Director and

Member of the Audit Committee


1999- Present President

The Telecommunications Association of Thailand

2000-2001 Chairman,

The Aeronautical Radio of Thailand Limited

1997-2001 Director,

The Press Council of Thailand

1998-2000 Independent Director and

Member of the Audit Committee,

PTT Exploration and Production Public Company Limited

Dr. Kosol PetchsuwanIndependent Director and



EducationFellow of the Association of

Chartered Certified Accountants, England.

Programme for Management Development,

Harvard Business School (U.S.A.).

Marketing Management Programme,

Stanford University, Graduate School of Business (U.S.A.)

Experience

1999-Present Independent Director and



2000-2001 Executive Chairman

TISCO Finance Public Company Limited


Thai Wah Group of Companies

1992-1994 Managing Director

The East Asiatic (Thailand) Company Limited

Consult-General of Denmark for Bangkok

Mr. Joti BhokavanijIndependent Director andMember of the Audit Committee


The heart of TRUE is personified by the 4 Cs: being Credible, being Creative, being Caring and being Courageous.

These 4 core values are expressed in the principles by which TRUE governs itself. The results have been positive.

2004 marked the third consecutive year that TRUE has ranked amongst the very top companies in The Corporate

Governance Report of Thai Listed Companies. The Corporate Governance Report is published annually by the Thai Institute

of Directors Association (Thai IOD) under the auspices of the Stock Exchange of Thailand (SET) and the Securities and

Exchange Commission (SEC). In making its determinations, Thai IOD looks at five core criteria:

1) rights of shareholders,

2) equitable treatment of shareholders,

3) role of stakeholders,

4) disclosure and transparency, and

5) board responsibilities.

1. Rights of Shareholders

TRUE strives to ensure that every shareholder is given an opportunity to hear, to be heard and to make a difference.

Caring

çWe treat people the way we want to be treated.é

Over the course of 2004 shareholders were invited to participate in four meetings conveniently held at TRUEûs Bangkok

headquarters. One was a general meeting, and three were extraordinary meetings. At least 7 days before each meeting,

detailed information on every agenda topic was disseminated by post. Additionally, in order to ensure dissemination of

information to the general public, the agenda was shared by publication in local newspapers and on TRUEûs website. At the

beginning of each meeting, the procedures of the meeting was explained to all shareholders in attendance, and every

shareholder was given the opportunity to express an opinion on any matter discussed. Directors, the chairman or a

representative of each Board committee, and members of management attend each meeting so that effective responses can

be provided for all shareholder comments and questions.


By having allocated not less than four Board seats to Independent Directors (the definition and course training from

Thai Institute of Directors Association (Thai IOD) are provided in Management content), the opinions of minority shareholders

can be heard at the highest levels of the company. Independent Directors are free of any interest concerning personal benefit

or position and free from the control of any particular special interest. Each is obligated to express his or her independent

opinion to the Board.

Moreover, every Director must stand for election every 3 years and his performance is, thereby, subjected regularly to

the voting scrutiny of the shareholders. On all shareholder voting matters, each shareholder is entitled to exercise votes equal

in number to the amount of shares held by him or her. Prior to each shareholder meeting, a proxy form is provided for those

TRUE shareholders who may wish to designate a proxy to vote on their behalf during the meeting.

2. Equitable Treatment of Shareholders

As a publicly listed company, TRUEûs shareholder base is large and diverse. TRUE recognizes the importance of

keeping every shareholder timely, accurately and appropriately informed. Important information is posted promptly on the

investor relations pages of TRUEûs web site, accessible via www.truecorp.co.th and www.true-corp.com, so that it reaches

all shareholders, whether they are a significant or a minority shareholder and wherever located, at the same time.

Credible

çWe communicate with integrity, always keeping the best interest of the company in mind.é

TRUEûs corporate web site gives the public a wealth of information about the company, its people and its performance.

Copies of minutes of meetings, investor presentations, past annual reports and filings with the Stock Exchange of Thailand

are just a part of the resources available 24/7/365 in both English and in Thai. Financial information dating back to 1999 is

available for downloading or by contacting TRUEûs Investor Relations department.

The Investor Relations department and the Corporate Secretary of TRUE each bear important responsibilities to TRUEûs

shareholders. Together, they are TRUEûs contact points with its shareholders. Corporate information to the general public and

shareholders flows through the Investor Relations department, whereas information to the general public and our regulators

is channeled through the Corporate Secretary.


Maintaining TRUEûs credibility is essential for gaining the investor confidence that is necessary to maximize and sustain

the value of the company and the wealth of TRUEûs shareholders. Analysts from Thailandûs major securities firms track TRUE

and, therefore, the Investor Relations department works cooperatively with these analysts. These analystsû reports lead to an

open discussion of TRUEûs operations and financial prospects, and are accessible by the general public and by TRUEûs

shareholders.

In 2004, TRUE increased its equity interest in its subsidiary, TA Orange. As assurance that the terms of the transaction

were çfairé to TRUEûs shareholders, çfairness opinionsé were given by BT Securities Company Limited. The transaction was

completed while providing utmost transparency for the benefit of all shareholders.

3. The Role of Stakeholders

The continued success of TRUE relies upon the ability of stakeholders to influence positively TRUEûs conduct and

activities, and vice-versa.

Caring

çWe are dedicated to working together in harmony to do whatûs right for our customers, colleagues and partners.é

TRUEûs Code of Conduct defines the term çstakeholdersé to include customers, shareholders, creditors, employees

and their families, the government, business partners, business competitors and the citizens of Thailand. The Code of

Conduct is a roadmap that provides clear direction to Directors, management and employees alike, of TRUE and of TRUE

affiliates, towards melding the 4 Cs into the corporate culture.

The Code of Conduct encourages all to make a positive contribution to Thai society and to the well-being of Thai

people. The year 2004 continued TRUEûs position as a corporate and community leader in enriching and providing assistance

for the well being of Thai society.

ë TRUE and the TRUE affiliates provided immediate assistance to the victims of the December 26th tsunami, and relief

for their families and friends. TA Orange provided free of charge calls to those in the tsunami-affected areas, allowing

them to contact loved ones. Within a day or so, food, clothing and materials donated by employees had reached the

victims.

ë Now in service to the nation for more than 10 years, TRUEûs Nature Classroom, Arts and Culture Classroom

and Science Classroom are programs that aim to foster self-improvement and are designed to help students gain

knowledge and insight from the classrooms, adding valuable and enriching experiences to their lives.


ë Pirab Noi invites students studying mass communications in Thailandûs universities to participate in the production of

high quality content, while also promoting responsibility and ethics in the area of communications/journalism.

ë TRUE works closely with the Bangkok Metropolitan Administration (BMA), Education Department to guide Thailand

towards becoming a çknowledge-based society.é Through collaborative efforts, the çInternet for a Knowledge-Based

Societyé program has connected more than 300 schools in Bangkok to resources they never had access to before.

TRUE believes if young people have access to the latest information from around the world via the Internet, then they

will be empowered to explore new boundaries and improve their lives. This, in turn, will enable them to make even

more valued contributions for the benefit of the country.

TRUE understands that it has a responsibility to safeguard the interests of its stakeholders. As it has for many years,

TRUE has kept an open and cooperative working dialogue with Marsh UK Ltd., which is the insurance advisor to TRUEûs

secured creditors. In addition, last year TRUE and its insurance broker procured a competitive, comprehensive, secure a

cost-effective insurance package for TRUE and its affiliated companies. There is also a strong national interest in TRUEûs

ability to continue business operations even in the event of a significant accident or disaster. TRUE continues to make

investments and to allocate resources to ensure that its key services have adequate backups and will continue to operate

under virtually any circumstances.

Internal safeguards are implemented under the management of TRUEûs Audit Department. The effectiveness of the

Audit Department oversight and internal controls is enhanced through utilization of the expertise of PricewaterhouseCoopers

Risk Management Services Limited.

4. Disclosure and Transparency

Through its own initiative, over four years ago the Board established a committee to enhance the governance of the

company by adopting international best practices. Three years ago the Corporate Governance Guidelines were placed into

practice. A complete copy of the Corporate Governance Guidelines is available on TRUEûs website.The Guidelines

encompass:

ë Duties and responsibilities of the Board of Directors

ë Composition and selection of the Board of Directors

ë Board structure and procedure

ë Board Leadership


ë Board relationship to management

ë Meeting procedures

ë Committees of the Board of Directors

ë General Committee Matters

ë Policy regard related party transactions and Code of Conduct

Courageous

çWe recognize that with opportunity comes accountability and with accountability, ownership.é

Adoption of the Corporate Governance Guidelines led to the formation of a new Board Committee, the Independent

Committee. The work of the Independent Committee includes oversight responsibility over any Board matter involving a

related party transaction or a corporate opportunity, as well as all matters that are covered by the Stock Exchange of

Thailandûs Rules and Procedures and Disclosure of Connected Transactions of Listed Companies. Details of Connected

Transactions that occurred during 2004 are provided in the çConnected Transactionsé section of this Annual Report for 2004.

TRUE has its own complementary standards for transactions with related entities, which are stated in the Policy

Regarding Related Party Transactions. Situations such as trading on insider information and having a personal relationship in

matters involving TRUE are explained and explored in detail in the Code of Conduct that every employee is asked to read

and acknowledge.

5. Board Responsibilities

TRUE stakeholders are served by 20 hard-working persons, each of whom is able to work with colleagues as one and

yet who can complement the value of the Board with his own particular strengths.

Creative

çWe share our ideas with each other to create strong synergies.é

The schedule of the Board meetings for the coming year is set by consensus at the final Board meeting of the prior year

and written notice of each meeting is provided to each Director in accordance with all applicable rules and regulations.


Individual strengths are utilized, and efficiency is achieved, by the delegation of 5 key Board responsibilities to these

standing committees:

- Audit Committee

- Finance Committee

- Corporate Governance Committee

- Compensation and Nominating Committee

- Independent Committee

No. Directors

1 Mr. Narong Srisa-an 7/8

2 Mr. Vitthya Vejjajiva 7/8

3 Dr. Kosol Petchsuwan 8/8

4 Mr. Joti Bhokavanij 8/8

5 Mr. Dhanin Chearavanont 5/8

6 Mr. Sumet Jiaravanon 0/8*

7 Dr. Ajva Taulananda 8/8

8 Mr. Chaleo Souvannakitti 8/8

9 Mr. Athueck Asvanund 8/8

10 Mr. Supachai Chearavanont 7/8

11 Mr. Soopakij Chearavanont 3/8

12 Mr. Chatchaval Jiaravanon 5/8

13 Mr. Vichaow Rakphongphairoj 8/8

14 Mr. Umroong Sanphasitvong 8/8

15 Mr. Heinrich Heims 3/8

16 Mr. Klaus Tuengeler 6/8

17 Mr. Claus Stadler 2/8

18 Mr. Andreas Klocke 5/8

19 Mr. Harald Link 4/8

20 Dr. Lee G. Lam 3/8

Attendance / Number of Meetings (times)

In 2004, 8 Board meetings were held. Director attendance at those meetings was as follows:

* Resident outside of Thailand


Further detail on each Board committee and their committee members, including copies of their respective committee

charters, can be obtained from the investor relations pages of TRUEûs website.

The current number and allocation of seats on the Board reflect a fair proportion of each shareholder groupûs

investment. Non-executive directors remain a majority of TRUEûs Board, keeping the balance of power with non-executives

and ensuring decision-making independence and credible oversight of management. The seat of Chairman of the Board

remains with a non-executive director.

In order to maximize the value to TRUE of the knowledge and experience of each Director, TRUE does not limit the

number of times that a Director may be re-elected or impose a mandatory retirement age.

Compensation of the top executives and the Board is recommended by the Compensation and Nominating Committee

and approved by the entire Board. Remuneration consists of a fixed salary and, when deemed appropriate, a variable

component. The variable component is linked to individual and corporate performance. TRUEûs shareholders have approved

the remuneration presently paid to Board members. Key members of executive Management have also been provided, with

approval of the Companyûs shareholders, Stock Options (which utilized the services of an independent advisor in performing

this function, particularly within Thailandûs telecommunication industry) as a key component of their compensation in order to

link their compensation to corporate performance and to establish a long term performance incentive. Details of such

remuneration are provided within the Management content of the annual report.

TRUE has disclosed publicly in filings made with the Stock Exchange of Thailand significant actions taken by its Board

over the course of 2004.


True Corporation is the most fully integrated nationwide communications solutions provider in Thailand and one of the

countryûs largest brands.

Since being established in 1990 to build and jointly operate 2.6 million fixed lines in the Bangkok Metropolitan Area

(BMA) under a 25-year concession, it has grown rapidly to meet the lifestyle needs of Thai consumers.

Backed by Asiaûs largest agro-conglomerate, the Charoen Pokphand Group (with a 39.22 percent shareholding), Trueûs

subsidiary businesses currently include cellular operator TA Orange, Asia Wireless Communication (operator of WE PCT), True

Multimedia, True Internet and pay TV operator United Broadcasting Corporation (UBC).

Through these companies True provides home consumers, small and medium enterprises and corporates with the full

range of cellular, wireless and wireline, Internet, data and entertainment products and services in customized packages.

It is firmly established as the BMAûs leading wireline service provider with 56 percent market share, is the countryûs

largest Broadband provider with more than 85 percent market share, and the countryûs leading Internet Service Provider. In

TA Orange, True owns the fastest growing and third largest mobile operator.

The Company was listed (as TelecomAsia Corporation Public Company Limited) on the Stock Exchange of Thailand in

December 1993 with the security symbol çTAé. At this time it had an annual turnover of Baht 2 billion and employed 1,500 staff.

At the end of December 2004, the True Group (which rebranded and adopted the çTRUEé security symbol in April 2004)

had an annual group turnover of more than Baht 40 billion (including 100 percent of TA Orange and UBC), a market

capitalization of Baht 33.1 billion, infrastructure investments of more than Baht 100 billion and employed more than 8,000 staff.

Key Developments in 2004

December 2004 TA Orange achieved 3.4 million subscriber base, exceeding its target.

True strengthens its balance sheet, significantly reduces debt and increases

equity by Baht 2.7 billion. It achieved this by selling 398 million new ordinary


shares at Baht 6.8 per share via a seven-time oversubscribed private placement in

Thailandûs first Accelerated Global Tender.

Funds raised were used to complete debt restructuring of a subsidiary with a

creditor, enabling the True Group, excluding TA Orange, to reduce debt by

approximately Baht 9.3 billion in 2004 including a Baht 2.7 billion gain from debt

forgiveness from the debt restructuring.

November 2004 True becomes Thailandûs largest Internet Service Provider with more than one

million customers.

October 2004 True announces that in cooperation with UBC it will launch Thailandûs first Broadband

TV service.

September 2004 True completes negotiations on long term debt financing for TA Orange,

enabling it to increase its shareholding in TA Orange to 83 percent.

NC True online game company is formed in a joint venture with Koreaûs NCsoft

to market the hugely popular Lineage II game in Thailand.

August 2004 True announces it will inject Baht 6 billion into TA Orange so the mobile operator

can expand network capacity and coverage to approximately 90 percent of

Thailandûs population.

June 2004 True raises Baht 2.4 billion by issuing seven year maturity Thai Baht debentures.

The funds are used to refinance debt to German creditor Kreditanstalt FürWiederaufbau (KfW).

May 2004 TA Orangeûs network quality is judged çBest in Bangkoké by a Synovate and

King Mongkutûs Institute survey.

April 2004 True launches the çAll Together Bonusé campaign which provides True telephone,

WE PCT and Internet users with the equivalent free TA Orange talk time

for every baht they spend on True services.

TelecomAsia changes its name to True as part of an çinside outé rebranding to

position the company for strong future growth.


ë True named çBest Competitive Carrieré in Telecom Asia Magazine 2004 Awards

The first time a Thai company has won an award in the seven years of this prestigious competition.

ë Disclosure Award for Good Corporate Governance

True has been included in the top quartile of listed Thai companies, ranked according to good corporate governance

practices, for two consecutive years.

The ranking was based on surveys implemented by the Thai Institute of Directors with the support of the SET and

the SEC.

ë Technology Fast 500 Asia Pacific Company Awards

True has been listed among Deloitteûs 2004 Technology Fast 500 Asia Pacific ranking for the fastest growing

companies.

ë Super Brand 2004

True was voted by consumers as a Thailand Superbrand in the Readerûs Digest Asia Superbrands Survey 2004.

In addition, in 2002 True won the Euromoney Award for Good Corporate Governance and in 2000 was ranked among

the top 10 leading Thai companies by Far Eastern Economic Review magazine.


Revenues breakdown by business group

% % %

1. Fixed line and Value Added Service1


Revenues 16,632 50.4 16,893 60.4 16,125 62.5

2. Wireless

Wire & Wireless Company Limited 87.50

Asia Wireless Communication Company Limited 99.99

Bangkok Inter Teletech Company Limited 82.86

Revenues 11,730 35.5 7,228 25.9 6,096 23.6

3. Multimedia Network and Broadband

True Multimedia Company Limited 90.45

Revenues 1,408 4.3 1,097 3.9 954 3.7

4. Data Service


True Multimedia Company Limited 90.45

Revenues 1,029 3.1 1,183 4.2 1,199 4.7

5. Internet

True Internet Company Limited 99.99

Asia Infonet Company Limited 65.00

True Digital Entertainment Company Limited 99.99

True Internet Data Center Company Limited 70.00

Revenues 887 2.7 471 1.7 198 0.8

6. Other Business

True Fleet Management Company Limited 99.99

True Properties Company Limited 99.99

Wire & Wireless Company Limited 87.50

Other Companies

Revenues 1,324 4.0 1,078 3.9 1,203 4.7

Total Revenues 33,010 100.0 27,950 100.0 25,775 100.0

Business Group/Operation byPercentageof SharesHeld by

the Company

31st December2004

31st December2003

31st December2002

BahtMillion

BahtMillion

BahtMillion

Source: The Company

1 Includes Fault Reporting and Dropwiring, Public Phone and Audiotext


Asia DBS Public Company Limited 18 True Tower DBS system operator THB 100 million

Ratchadaphisek Road

Huai Khwang, Bangkok 10310

True Multimedia Co., Ltd 18 True Tower NON-POTS and THB 6,127 million

(Formerly named Asia Multimedia Ratchadaphisek Road multimedia services

Company Limited) Huai Khwang, Bangkok 10310

Asia Wireless Communication 18 True Tower PCT operator THB 5,797.85 million

Company Limited Ratchadaphisek Road


The Companyûs subsidiaries, associates companies and other investments are as follows:

Company Name Address Type of Business

True Corporation Public Company Limited, with the security symbol çTRUEé on the Stock Exchange of Thailand was

established on 13th November 1990 initially under the name of CP Telecommunication Co., Ltd. with a registered capital of

Baht 1,000 million to undertake Thailandûs major telecommunication infrastructures project and registered as a public

company limited with registration no. Bor Mor Jor 82 on 11th February 1993.

As at 31st December 2004, the Companyûs registered capital was Baht 46,583,393,190.- consisting of 3,958,873,833

common shares with a par value of Baht 10 per share and 699,465,486 preference shares with a par value of Baht 10 per

share, of which Baht 40,925,272,140.- is paid-up capital, comprising of 3,393,061,728 common shares with a par value of

Baht 10 per share and 699,465,486 preference shares with a par value of Baht 10 per share.

The Companyûs head office is located at: 18 True Tower Ratchadaphisek Road


Telephone : (662) 643-1111

Fax : (662) 643-1651

Website : www.truecorp.co.th

Paid-up Capital


Bangkok Inter Teletech 986 U Chu Liang Building, Investment in THB 21,000 million

Company Limited 14th Floors, Unit D, Cellular Operator

Rama IV Road, Silom,

Bangrak, Bangkok

TA Orange Company Limited 986 U Chu Liang Building, 1,800 MHz cellular THB 27,100.10 million

4th-5

th, 11

th-15

th Floors, telephone operator


Bangrak, Bangkok

TA Orange Retail Company Limited 986 U Chu Liang Building, Retail services THB 1 million

14th Floors, Unit D3


Bangrak, Bangkok

Song Duo Company Limited 986 U Chu Liang Building, Inactive THB 1 million

14th Floors, Unit D2


Bangrak, Bangkok

K.I.N. (Thailand) Company Limited 18 True Tower Holding Company THB 75 million

Ratchadaphisek Road


True Properties Company Limited 18 True Tower Rental services THB 3,488 million

(Formerly named Nilubon Ratchadaphisek Road,

Company Limited) Huai Khwang, Bangkok 10310

Tele Engineering and Services 18 True Tower Construction and THB 25 million

Company Limitedå Ratchadaphisek Road distributor

Huai Khwang Bangkok 10310

Company Name Address Type of Business Paid-up Capital


Telecom Equipment 18 True Tower Telecom equipment THB 24 million

Manufacturing Company Limited Ratchadaphisek Road manufacturer


Telecom Holding Company Limited 18 True Tower Holding Company THB 16,589.25 million

Ratchadaphisek Road


Telecom International Company Limited 18 True Tower Holding Company THB 300 million

Ratchadaphisek Road


Telecom Training and 18 True Tower Training service THB 50 million

Development Company Limited Ratchadaphisek Road


True Digital Entertainment 1 Fortune Tower, 25th Floor Online game THB 73.5 million

Company Limited Ratchadaphisek Road

Din Dang, Bangkok 10400

True Internet Company Limited 1 Fortune Tower, 14th,27

th Floor Audio text services THB 236.40 million

(Formerly named Asianet Ratchadaphisek Road and internet dealer

Corporation Company Limited) Din Dang, Bangkok 10400

T-Pay Company Limited 18 True Tower Payment THB 30 million

Ratchadaphisek Road service center


U-Net Company Limited 18 True Tower Construction and THB 93 million

Ratchadaphisek Road distributor


Wire & Wireless Company Limited 54 W&W Bld., Pattanakarn 20 Construction and THB 100 million

Suanluang Bangkok distributor



Asia Remanufacturing Industries 102,15th Floor, Modification, repair THB 5.6 million

Company Limited Na Ranong Road, and maintenance

Klongtoey, Bangkok services

True Fleet Management 18 True Tower Rental services THB 150 million

Company Limited (Formerly named Ratchadaphisek Road

W7 Rental Services Company Limited) Huai Khwang, Bangkok 10310

Yai Kaew Company Limited 18 True Tower Investment in property THB 10 million

Ratchadaphisek Road


K.I.N. (Thailand) Company Limited P.O. Box 957, Holding Company USD 1

(Foreign Company) Offshore Incorporation Centre,

Road Town, Tortola,

British Virgin Island

Nilubon Company Limited P.O. Box 71, Holding Company USD 1

(Foreign Company) Craigmuir Chambers, Road Town,

Tortola, British Virgin Island

TA Orient Telecom 3/F, Hing Yip Commercial Holding Company HK$ 117 million

Investment Company Limited Centre, 272 Des Voeus

Road C., Hong Kong

Telecom Asia (China) P.O. Box 957, Commercial HK$ 78

Company Limited Offshore Incorporation Centre,

Road Town, Tortola,


Telecom International China P.O. Box 71, Commercial HK$ 78

Company Limited Craigmuir Chambers,

Road Town,Tortola,




Chongqing Communication 140 Daping Zhengjie Chongqing Telecommunication RMB 292 million

Equipment Co., Ltd. Peopleûs Republic of China equipment manufacturer

Asia Infonet Company Limited 1 Fortune Town Bldg., 14th, Internet service THB 15 million

17th Floor Ratchadaphisek Road provider


True Internet Data Center 18 True Tower, 14th Floor Internet Data Center THB 115.02 million

Company Limited (Formerly named TA Ratchadaphisek Road

Internet Data Center Company Limited) Huai Khwang, Bangkok 10310

United Broadcasting Corporation 118/1 Tipco Building Pay Television THB 9,704.05 million

Public Company Limited Rama 6 Road,

Phayathai, Bangkok

NC True Company Limited 18 True Tower, 18th Floor Developer and service THB 125.5 million

Ratchadaphisek Road provider of online game


N.T.U. (Thailand) Company Limited 518/5 Maneeya Center Building, Telecommunication THB 12 million

7th Floor, Ploenchit Road,

Lumpinee, Pathumwan, Bangkok

Thai Smart Card Company Limited 191 Silom Complex Building Central Service THB 395 million

27th Floor, Room No. 2, Bureau for clearing

Silom Road, Bangrak, Bangkok electronic payment

transactions

NEC Corporation (Thailand) 159 Sermmit Tower 2nd, Telecommunication THB 343 million

Company Limited 24th Floor, Sukumvit 21 equipment manufacturer

Klongtoeynua Wattana Bangkok



Registrar : Thailand Securities Depository Co.,Ltd

62 Stock Exchange of Thailand Building, 4, 6, 7/F

Ratchadaphisek Road, Klong Toey Bangkok 10110

Telephone : (662) 229-2800, (662) 654-5599

Fax : (662) 359-1262-63

Auditor : Mr. Kajornkiet Aroonpirodkul

(CPA Registration No. 3445) and/or

Mrs. Nattaporn Phan-Udom (CPA Registration No. 3430)

and/or Mr. Boonmee Ngotngamwong

(CPA Registration No. 3673)

PriceWaterhouseCoopers ABAS Ltd.

15th Floor, Bangkok City Tower 179/74-80

South Sathorn Road, Sathorn Bangkok 10120

Telephone : (662) 286-9999, (662) 344-1000

Fax : (662) 286-5050

Debenture Registrar/ : Thai Military Bank Public Company Limited

Debentureholdersû 393 Silom Road, Bangrak, Bangkok 10500

Representative Telephone : (662) 233-9160-79

(662) 230-5000

Fax : (662) 236-7939

Legal Counsel : Siam Premier International Law Office Limited

24th - 26

th Floors, Thai Wah Tower 2

21/147 -150 South Sathon Road

Bangkok 10120

Telephone : (662) 679-1333

Fax : (662) 679-1314

Website : www.siamlaw.co.th

References


While True sees many opportunities to grow in 2005, there are a number of general and specific factors that could

impact the companyûs performance and that of its subsidiaries.

Industry Risks

True and its subsidiaries, particularly TA Orange and its Internet and Broadband businesses, face increasing competition

from cellular operators, TOT and new ISP market entrants. As a result, the tariff for mobile phone calls and Broadband

service has fallen steadily over the past year, which has had, and will continue to have, an impact on operational results.

We expect competition to remain intense in the future, but believe True is well positioned to meet this given its

leadership position in the Internet/Broadband market and TA Orangeûs strong 2004 revenue growth and expanding customer

base. In addition, rapid technological change could also adversely affect the viability of Trueûs business and make its own

technology less competitive. However, at the time of writing no such new technology has been identified as a major current

or imminent business threat.

Regulatory and Liberalization Risks

True and its subsidiaries operate under a number of concessions granted by TOT Corporation Public Company Limited

and CAT Telecom Public Company Limited. A dispute with either TOT or CAT over compliance with a concession agreement

could affect Trueûs ability to conduct business. This concession could be cancelled by TOT if True violates laws relating to

public or national security, the Company is placed under receivership by a court in a bankruptcy case, or it willfully and

continually breaches a concession agreement in any material respect. However, TOT must submit the case to the Arbitration

Tribunal for adjudication before it can cancel the concession agreement with True.

Under revenue sharing provisions of Trueûs fixed line concession, TOT collects all of Trueûs fixed line revenues and retains

a portion for the revenue sharing. TOT may withhold or delay payments from revenues collected for True to offset any

obligations it believes it is owed (although this has not occurred to date).


As well as being Trueûs concession granter, TOT is also a competitor in the BMA fixed line market. This has and could

continue to lead to disputes between True and TOT, which can deny or put on hold Trueûs requests to launch new services.

TOT and True have brought some disputes to the Administrative Court and the Arbitration Tribunal for adjudication.

In August 2002 True asked the Arbitration Tribunal for compensation from TOT for access charge revenues TOT

generated using Trueûs network. In August 2004, True asked the Arbitration Tribunal for compensation from TOT for sharing

on revenues generated from additional public phones apart from the first 20,000 sets. In January 2005, True also asked the

Arbitration Tribunal to ensure TOT shared revenues from incoming international calls based on the rate indicated in the

concession.

In July 2004 TOT asked the Arbitration Tribunal to require True to pay advertising cost for placing Trueûs logo on

Payphone booths. And in December 2004, TOT also sought costs for placing the True logo on invoices and receipts.

The pending liberalization of the Thai telecommunications industry is expected to reduce or eliminate these conflicts of

interest, but proposed initiatives could put True at a disadvantage to competitors. It is also possible that certain policies to

be imposed by the National Telecommunications Committee may affect Trueûs operating costs and/or increase

competition in the sectors in which it operates.

Risks Related to Financial Situation

Trueûs operation is restricted by a number of debt and other financial agreements. These agreements could prohibit True

from exploiting good business opportunities or lead to accelerated debt repayment if TOT cancels the concession agreement

with the Company. However, TOT must seek an arbitration decision in order to cancel the concession agreement.

True is subject to exchange rate fluctuations, which could increase interest payments. True had total debt of Baht 84

billion as at December 31, 2004, with 13 percent of this being denominated in foreign currencies (Japanese Yen and US

Dollar). In 2004, the Company had consolidated capital expenditure of approximately Baht 4.0 billion, approximately 40 percent of

which was in foreign currencies. The Company has put in place hedging tools to reduce its exposure to exchange rate

fluctuations, primarily for the majority portion of a USD 170 million loan belonging to a subsidiary.

Out of the Companyûs total debt, about 50 percent is subject to floating interest rates and vulnerable to rate increases.

All TA Orange debt, accounting for approximately 37 percent of total consolidated debt, is subject to floating rates. However,

TA Orange debt interest rates will step down over time if it is able to achieve conditions set out in its loan agreement.


True Corporation Public Company LimitedMajor Shareholders1

(as of 30th December 2004)

1. CP GROUP2 1,605.14 39.22

2. THAILAND SECURITIES DEPOSITORY COMPANY 1,240.97 30.32

LIMITED FOR DEPOSITORS (FOREIGN)

3. THAILAND SECURITIES DEPOSITORY COMPANY LIMITED 468.91 11.46

FOR DEPOSITORS (THAI)

4. THAI TRUST FUND 357.99 8.75

5. KREDITANSTALT FÜR WIEDERAUFBAU (çKfWé) 341.47 8.34

6. MR. JATURONG JATUPARISUTHI 11.08 0.27

7. MR. SOONTHORN ARUNANONCHAI 5.00 0.12

8. MISS PIMRA INTHARAVITTAYANUN 4.50 0.11

9. MR. CHALEO SOUVANNAKITTI 3.50 0.08

10. VATCHARAPOL CO., LTD. 3.00 0.07

Name No. of Shares % of Total(Million Shares) Issued Shares

Remark :1Including common shares and preferred shares

2There are Charoen Pokphand Group Co., Ltd. and its related persons namely, Bangkok Telecom Holding Company Limited, Charoen Pokphand Foods Public

Company Limited, Bangkok Produce Merchandising Public Company Limited, Bangkok Agro-Industrial Products Public Company Limited, Charoen Pokphand

Northeastern Public Company Limited, Kasetphand Industry Company Limited, Charoen Pokphand Enterprise Company Limited, Unigue Network Company

Limited, Wide Broad Cast Company Limited, C.P. Interfood (Thailand) Company Limited, Star Marketing Company Limited, Advance Pharma Company Limited and

Golden Tower Trading Limited.

Shareholders


The Company has not paid or declared any dividends on its issued shares since operation commencement. The

Company can pay dividends only out of its profits after deducting its cumulative losses, and only if it has set aside as a legal

reserve. The Companyûs restructuring agreement also limits its ability to pay dividends until all of its indebtedness is repaid

in full.

The Companyûs principal shareholders have entered into a shareholdersû agreement under which they agreed to vote for

and cause their representatives appointed to the Companyûs Board of Directors to declare an annual dividend equal to at

least 50% of its net profits for that year, after statutory reserves and subject to availability of cash, the regulations of the SET,

and its credit facilities. Before dividends can be paid to holders of its ordinary shares, however, dividend payments on

preferred shares must be paid in full. Within March 31, 2008, the eighth anniversary from the date its preferred shares were

issued, the Companyûs preferred shareholders are entitled to receive cumulative dividends at the rate of Baht 1 per share per

fiscal year. After March 31, 2008, holders of our preferred shares are entitled to a non-cumulative dividend at the rate of Baht

0.01 per share per fiscal year. The right to receive cumulative dividends for any fiscal year in which the payment of those

dividends was not declared ceases once a holder converts its preferred shares into ordinary shares.

For dividend policy of subsidiary company, each subsidiary companyûs Board of Directors will consider the payment of

dividends from the balance of cash flows compare with capital investment of individually subsidiary company. Subject to the

availability of cash flows of subsidiary company and only if it has set aside as a legal reserve, each Board of Directors of

individually subsidiary company shall consider the payment of dividends just in case.


The Board of Directors of the Company is as follows:

Name Position

Management Structure of the Company consists of the Board of Directors, the Committees and the executive officers,

details of which are as follows:

Board of DirectorsAs of 31

st December 2004, the Board of Directors comprises of 20 directors who are (a) Executive Directors

(b) Non-Executive Directors including directors representing the creditors, and (c) Independent Directors means a director who is

independent from a major shareholder or a group of major shareholders and having the qualification as follows:-

- not being an employee or a staff member or an advisor who receives a regular salary or any other benefit from the

Company, an affiliated company, associated company or a related company

- not holding shares exceeding 0.5 percent, including shares held by a related person, of paid-up capital of the

Company or an affiliated company, associated company or a related company

- the ability to take care of the interest of all shareholders equally

- the ability to prevent conflict of interest among the Company and its management, major shareholders or other

companies which have the same group of management or major shareholders as the Company

1. Mr. Narong Srisa-an Independent Director

2. Mr. Vitthya Vejjajiva Independent Director and


3. Dr. Kosol Petchsuwan Independent Director and


4. Mr. Joti Bhokavanij Independent Director and


5. Mr. Dhanin Chearavanont Chairman

6. Mr. Sumet Jiaravanon Vice Chairman

7. Dr. Ajva Taulananda Vice Chairman

8. Mr. Chaleo Souvannakitti Vice Chairman

9. Mr. Athueck Asvanund Vice Chairman and Group General Counsel

10. Mr. Supachai Chearavanont Director, President and

Chief Executive Officer

11. Mr. Soopakij Chearavanont Director

12. Mr. Chatchaval Jiaravanon Director and Managing Director-Group

Investment

13. Mr. Vichaow Rakphongphairoj Director, Managing Director and

Chief Operating Officer

Management


Name Position

14. Mr. Umroong Sanphasitvong Director

15. Mr. Heinrich Heims Director

16. Mr. Klaus Tuengeler Director

17. Mr. Claus Stadler Director

18. Mr. Andreas Klocke Director

19. Mr. Harald Link Director

20. Dr. Lee G. Lam Director

Remark : Additional information related to the Companyûs Board of Directors is as follows:

a) History of Offence : none

b) Debt owed to the Company or its Subsidiaries : none

c) Material Connected Transactions : none

Mr. Narong Srisa-an, Dr. Kosol Petchsuwan and Mr. Joti Bhokavani has already taken çDirectors Accreditation Programé

(DAP) from Thai Institute of Directors Association (IOD)

Mr. Vitthya Vejjajiva, Dr. Kosol Petchsuwan and Mr. Joti Bhakavanij has already taken çChairman 2000é

from Thai Institute of Directors Association (IOD)

Authority and Responsibility of the Board of DirectorsThe Board of Directors is granted the authority and duty to manage the Company in compliance with the objectives

and articles of association of the Company and the resolutions of the shareholders meetings. With regard to the management

of the Company, the Board of Directors has authority to make any decision related to the Companyûs regular operation

except for the matter required the approval of the shareholders meeting as specified by law. In addition, the Board of

Directors may grant the authorization to one director or more or any other person to perform any acts on its behalf, however,

any decision on major operations such as major investment and major procurement of loan, the management team shall

propose the said transactions to the Board of Directors for approval.

Authorized DirectorsMr. Supachai Chearavanont or Mr. Vichaow Rakphongphairoj jointly sign with Mr. Athueck Asvanund or Mr. Soopakij

Chearavanont or Mr. Chatchaval Jiaravanon to with the Companyûs seal affixed, execute any act, thing or legal action

whatsoever on the Companyûs behalf.

Appointment of DirectorsThe Compensation and Nominating Committee assists the Board of Directors in reviewing and proposing the compensation

and nominating directors of the Company prior to proposing to the Companyûs shareholders meeting for final approval.


With regard to the right of shareholders to appoint directors, each shareholder shall appoint the directors by a majority

vote. All Shareholders have the rights to appoint directors. Each shareholder shall have one right to vote per one share and

shall appoint one director or more, provided that he cannot divide his votes to any person to any extent.

In selecting an independent director, the Company will take into account of the prospectûs qualifications that required

by the Stock Exchange of Thailand together with the background and experiences appropriate for the Company business

prior to proposing the nomination of the prospect to the Compensation and Nominating Committee and the Board of

Directors for further approval.

Audit CommitteeAs of 31

st December 2004, the Audit Committee of the Company consists of 3 persons as follows:

1. Mr. Vitthya Vejjajiva Chairman of the Audit Committee

2. Dr. Kosol Petchsuwan Member of the Audit Committee

3. Mr. Joti Bhokavanij Member of the Audit Committee

The scope of duty and responsibility of the Audit Committee is as follows:1. To review the Companyûs financial reports to ensure accuracy and adequate information for public disclosure;

2. To ensure the appropriateness and effectiveness of internal control system and internal auditing system of the

Company;

3. To consider and propose the appointment and remuneration of an external auditor of the Company;

4. To regularly review the practice of the Company to ensure the compliance with the regulations of the Securities and

Exchange Act, Rules and Regulations of the Stock Exchange of Thailand and related law and regulations;

5. To review the disclosure of information of the Company to ensure the accuracy and adequacy of said information

in case that there is a connected transaction that may lead to a conflict of interest;

6. To prepare the Audit Committee Report on the Corporate Governance with the approval of the Chairman of the

Committee appeared therein to be disclosed in the annual report of the Company; and

7. To perform any other act as required by law or as delegated by the Board of Directors.

Independent CommitteeThe Independent Committee is responsible for reviewing and monitoring the entering into any connected transactions,

which may involve a conflict of interest with the Company. The Committee consists of the following members:

1. Mr. Narong Srisa-an Independent Director

2. Mr. Joti Bhokavanij Independent Director

3. Mr. Klaus Tuengeler KfW-nominated Director (with the alternate of Mr. Andreas Klocke

or Mr. Claus Stadler)


4. Mr. Supachai Chearavanont CP-nominated Director

5. Mr. Athueck Asvanund CP-nominated Director

In the case of any major shareholder having a conflict of interest, Directors nominated by the said shareholder will

abstain from the Independent Committee Meeting.

Compensation and Nominating CommitteeThe Compensation and Nominating Committee is responsible for determining the compensation and considering the

nomination of the directors of the Company. The committee consists of the following members:

1. Mr. Dhanin Chearavanont

2. Mr. Heinrich Heims

3. Mr. Soopakij Chearavanont

4. Mr. Umroong Sanphasitvong

Finance CommitteeThe Finance Committee assists the Company in reviewing and monitoring the financial management of the Company.

The committee consists of the following members:

1. Dr. Ajva Taulananda

2. Mr. Chaleo Souvannakitti

3. Mr. Heinrich Heims (alternates being Mr. Klaus Tuengeler or Mr. Andreas Klocke)

4. Mr. Umroong Sanphasitvong

Corporate Governance CommitteeCorporate Governance Committee is responsible for setting policy on Corporate Governance of the Company.

The Committee consists of the following members:

1. Dr. Ajva Taulanada

2. Mr. Vitthya Vejjajiva

3. Mr. Claus Stadler

4. Mr. Athueck Asvanund

5. Mr. Supachai Chearavanont

6. Mr. William E. Harris


Executive OfficersAs of 31

st December 2004, the executive officers of the Company are as follows:

1. Mr. Supachai Chearavanont Director, President and

Chief Executive Officer

2. Mr. Vichaow Rakphongphairoj Director, Managing Director and

Chief Operating Officer

3. Mr. Chatchaval Jiaravanon Director and Managing Director-Group

Investment

4. Mr. Athueck Asvanund Vice Chairman, Group General Counsel and

Acting Company Secretary

5. Mr. William E. Harris Chief Financial Officer

6. Mr. Thiti Nantapatsiri Managing Director

Home / Consumer Solution & Highspeed Access

7. Mr. Adhiruth Thothaveesansuk Managing Director

Office / SME Solution & Wireless Access

8. Mr. Songtham Phianpattanawit Managing Director

Corporate Solution, Wholesales & Data

Remark:1. Executive Officers mean Directors, President or persons with managerial authority who are among the top four

ranking individuals in the Company, after the President, and all other persons who occupy a position equivalent to

such a top four ranking individual.

2. Additional information related to the Companyûs Executive Officers is as follows:

a) History of Offence : none

b) Debt owed to the Company or its Subsidiaries : none

c) Material Connected Transactions : none

Authority and Responsibility of the PresidentThe President has the authority to supervise and carry on the Companyûs day-to-day business, and in case any matter/

transaction is important, the President will submit said matter/ transaction to the independent directors and/or the relevant

Committee (such as the Finance Committee, the Compensation and Nominating Committee or the Independent Committee)

and/or the Board of Directors, as the case may be, to approve said matter/ transaction. In addition, the President has no

authority to approve any matter/ transaction that he or the person who may have a conflict of interest or any other form of

conflict, which the Company or the Companyûs subsidiaries have or propose to enter into, with the Company or the

Companyûs subsidiaries. In such case, such matter/ transaction shall have to be approved by the independent directors and/

or the relevant Committee and/or the Board of Directors, as the case may be.


Remuneration for the Companyûs Directors and the Executive Officers(1) Remuneration of the Director

The 20 committee members are remunerated Baht 37.20 million for the Year 2004.

Details of Remuneration of each Director are as follows:

Chairman Baht 300,000 per month

Honorary Chairman Baht 200,000 per month

Vice Chairman Baht 150,000 per month

Director Baht 100,000 per month

In this connection, any director being the Companyûs employee shall receive the directorûs remuneration in addition to

his salary as employee.

Furthermore, Independent Directors who hold a position in the Committee, shall receive the remuneration as follows:

Independent Director who is also Baht 300,000 per month

the Chairman of the Committee

Independent Director who is also Baht 200,000 per month

a member in the Committee

Whereby the remuneration of the Independent Directors who are not the member in the Committee and directors who are

not the Independent Directors shall remain the same.

(2) Remuneration of the Executive OfficersThe 8 executives at the top level received remuneration totaling Baht 96.05 million for the Year 2004 from January to

December, which included Baht 85.20 million for salary, Baht 6.94 million for bonus and Baht 3.90 million for provident fund.

(3) Other Compensation(3.1) Employee Stock Option Plan 2004

(3.2) Employee Stock Option Plan 2003



(3.1) Employee Stock Option Plan 2004The Extraordinary General Shareholders Meeting No. 2/2547 of the Company for the year 2004 held on 10th June

2004 has approved the issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to

certain Directors and employees at executive level totaling not exceeding 35 persons. Summary details are as follows:


Number of Warrants Issued and Outstanding : 18,274,444 units

Date of Issuance : 7th February 2005

Maturity : 5 years from the issuance date

Date of Expiry : 6th February 2010

Exercise Period : Each Warrant Holder received 3 separate warrant certificates.

Each certificate represented 1/3 of the whole amount of

warrants allotted and shall be exercisable for subscribing

ordinary shares as follow:

The 1st Certificate: Warrant Holders shall be starting exercising

from 7th February 2006 until its expiration.

The 2nd Certificate: Warrant Holders shall be starting exercising


The 3rd Certificate: Warrant Holders shall be starting exercising


Exercise Ratio : One unit of warrants entitles to purchase one ordinary

share at Baht 11.20

(3.2) Employee Stock Option Plan 2003The Annual General Shareholders Meeting of the Company for the year 2003 held on April 11, 2003 has approved the

issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and

employees at executive level totaling not exceeding 35 persons. Summary details are as follows:


(as at 28th February 2005)

Date of Issuance : 17th June 2003


Date of Expiry : 16th June 2008



Each certificate represented 1/3 of the whole amount of

warrants allotted and shall be exercisable for subscribing

ordinary shares as follow:


from 17th June 2004 until its expiration.






share at Baht 5.20

(3.3) Employee Stock Option Plan 2002The Annual General Shareholders Meeting of the Company for the year 2002 held on April 12, 2002 has approved the

issuance and the offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and







Each certificate represented 1/3 of the whole amount of warrants

allotted and shall be exercisable for subscribing ordinary

shares as follow:









share at Baht 10.60

(3.4)Employee Stock Option Plan 2000The Annual General Shareholders Meeting of the Company for the year 2000 held on April 27, 2000 has approved the

issuance and offer of non-transferable warrants to purchase the Companyûs ordinary shares to certain Directors and






Exercise Period : (a) Warrant Type 1:

Each Warrant Holder received 3 separate warrant certificates.


allotted and is exercisable for subscribing ordinary shares starting

from June 30, 2000, 2001 and 2002 respectively.

(b) Warrant Type 2:

Each Warrant Holder received 3 separate warrant certificates.


allotted and is exercisable for subscribing ordinary shares starting

from December 31, 2000, 2001 and 2002 respectively.


share at Baht 10.60


Details of Warrant-holding under ESOP Plan

Warrants underESOP 2000

NameWarrants under

ESOP 2004

1. Dr. Ajva Taulananda ------ ------ ------- ------ ------- ------ 2,240,000 6.06

2. Mr. Soopakij Chearavanont ------ ------ ------ ------ ------ ------ 4,130,000 11.16

3. Mr. Supachai Chearavanont 2,434,077 12.74 3,696,402 18.61 7,058,824 19.01 6,510,000 17.60

4. Mr. Vichaow Rakphongphairoj 1,277,890 6.69 1,617,176 8.14 3,088,235 8.32 2,800,000 7.57

5. Mr.Chatchaval Jiaravanon 1,277,890 6.69 1,940,611 9.77 3,705,882 9.98 4,130,000 11.16

6. Mr. Athueck Asvanund 1,331,136 6.97 2,021,470 10.18 3,860,294 10.40 5,320,000 14.38

7. Mr. William E. Harris 1,277,890 6.69 1,297,838 6.53 3,000,000 8.08 945,000 2.55

8. Mr. Adhiruth Thothaveesansuk 1,277,890 6.69 850,404 4.28 1,503,662 4.05 ------ ------

9. Mr. Thiti Nantapatsiri 1,277,890 6.69 ------ ------ ------ ------ ------ ------

10. Mr. Songtham Phianpattanawit 1,277,890 6.69 ------ ------ ------ ------ ------ ------



No. of

warrants

% of

Project

No. of

warrants

% of

Project

No. of

warrants

% of

Project

No. of

warrants

% of

Project


Insider Trading PolicyThe Company is currently in compliance with applicable laws to monitor and prevent the personal use of confidential

information of the Company by its management, including the use of said information for the purpose of insider trading.

Material information which has not yet been disclosed will be kept confidential but will be disclosed only to the relevant senior

management of the Company. The relevant senior management of the Company who shall access or receive said information

are required to report their trading of shares in the Company pursuant to the Regulations of the Office of the Securities and

Exchange Commission Regarding Rules, Conditions, and Procedures Governing the Preparation and Disclosure of Reports

on Securities Holdings, in order to prevent insider trading using internal information, and to ensure that the trading of shares

by çinsidersé of the Company is transparent.

In addition, the Company has been carrying on the comparative study of the insider trading policies of various foreign

institutions to be applied as a guideline to enhance transparency and boost the confidence in the Company amongst the

analyst and investor community.

Internal ControlsAfter an assessment of the Companyûs internal controls with the Audit Committee, the Board of Directors has an opinion

that the Companyûs internal controls are adequate and suitable. Moreover, the external auditor has an opinion that they/it did

not encounter any matter involving internal controls and its operation which are considered to be material weaknesses that

could have a material effect on the financial statements. The Board also emphasized the development of the Companyûs

Corporate Governance in order to improve the internal controls within the Company on a continuing basis.

Personnel As of 31

st December 2004, the total number of employees is as follows:

Management 82

Service Area & Network Operation 2,273

Marketing & Sales 425

Information Technology 242

Customer Services 799

Finance & Accounting 230

Supporting 286

Total 4,337

Work Group and Classification No. of Employees

Source : the Company


Remuneration for the Companyûs Employees

Remuneration In 2004, the total remuneration for employees was approximately Baht 2,026.89 million which consists of wages, salaries,

bonus, overtime compensation, commission, provident fund and others. (please see details in the note 27 to the financial

statements)

Other Compensation & BenefitsHealth Plans and Employee Welfare- In-house clinic

- Annual Medical Check-up

- New Employeeûs Medical Check-up

- Group Health Insurance

- Group Accident Insurance

- Group life Insurance

- In case of death: Baht 30,000. - / Person

- Social Security Fund

- Each of the Company and employees contributes 5% of monthly salary (If any employeeûs salary is more than Baht

15,000 a month, it was calculated only Baht 15,000 as the basic of funding). Said employee will gain special benefits

from the Fund to have medical treatment at designated hospitals.

Paid Annual Leave- After 1 year of service, employees are eligible for annual leave as below:

- Assistant Director Level and upwards are eligible for 15 days per annum and the others are eligible for 10 days

per annum

- Employees have to take accountability to complete their annual leave by December otherwise, annual leave cannot

be accumulated to the subsequent year.

- Annual leave can be accumulated to the subsequent year only in case of urgent of work. The accumulation should

be approved by authorized superior, but the total days should not be more than 30 for level of Assistant Director

and upwards and 20 for the others.

Compensation- Monthly Salary

- Annual Performance Pay: between 0-4 times of monthly salary, subject to the Companyûs performance and

financial status.

- Retirement: the employee must be at the age of 60 years or early retirement by agreement of company

and employee, severance pay will be paid accord to the labor law.


Employee Training and Development

Employee Training and Development PolicyTo encourage all employees to develop their knowledge, skills and attitude to be able to perform their jobs effectively

and to be more competent for career advancement, which assists the Company in achieving its corporate strategy and

goals. At present, the Company provides employees with various training and development programs, such as Core

Competency Program, Functional Competency Program, True Core Business Program, etc.


Mr. Narong Srisa-an Independent 77 10,000 Shares 1998-Present Independent Director

Director True Corporation Public Company

Limited

Present Chairman

Advanced Agro Public Company

Limited

Chairman

Thanakorn Vegetable Oil Products

Company Limited

Chairman

Surabangyikhan Company Limited

Chairman

Thai Beverage Can Limited

Chairman

Eastern Seaboard Industrial Estate

(Rayong) Company Limited

Chairman

Thai Alcohol Public Company

Limited

Chairman of the Executive Board

Siam Food Products Public

Company Limited

Chairman of the Executive Board

Beer Thai (1991) Public Company

Limited

Vice Chairman

Berli Jucker Public Company

Limited

DIRECTORSû INFORMATION (AS OF 31st DECEMBER 2004)

Name Position Age True Share Experience(Year) Ownership

(31/12/47)


Vice Chairman

General Tobacco Company Limited

Vice Chairman

Thai Beverages Public Company

Limited

Executive Director

Com-link Company Limited

Mr. Vitthya Vejjajiva Independent 68 - 1998-Present Independent Director and

Director Chairman of the Audit Committee,

and Chairman True Corporation Public Company

of the Audit Limited

Committee Chairman

K Line (Thailand) Company

and its subsidiaries

1991-1992 Permanent Secretary of the Ministry

of Foreign Affairs


Plenipotentiary of the United States

of America


Plenipotentiary of Belgium

and the European Community


Plenipotentiary of Canada

1979 Director

General of Department of

Economic Affairs


(31/12/47)


Dr. Kosol Petchsuwan Independent 66 - 1999-Present Independent Director and Member

Director of the Audit Committee

and Member True Corporation Public Company


Committee 1999-Present President

The Telecommunications

Association of Thailand

2000-2001 Chairman

The Aeronautical Radio of

Thailand Company Limited

1997-2001 Director

The Press Council of Thailand

1998-2000 Independent Director and member

of the Audit Committee

PTT Exploration and Production

Public Company Limited

Mr. Joti Bhokavanij Independent 62 - 1999-Present Independent Director and

Director Member of the Audit Committee

and Member True Corporation Public Company


Committee 2000-2001 Executive Chairman

TISCO Finance Public Company

Limited


Thai Wah Group of Companies


The East Asiatic (Thailand)

Company Limited

Consult-General of Denmark

for Bangkok


(31/12/47)


Mr. Dhanin Chearavanont Chairman 65 - 1989-Present Chairman

True Corporation Public Company

Limited

Chairman and Chief Executive Officer

Charoen Pokphand Group Company

Limited and Chia Tai Group

Company Limited

Chairman

Charoen Pokphand Foods Public

Company Limited

Mr. Sumet Jiaravanon Vice Chairman 70 150,000 shares 1993-Present Vice Chairman


Limited

Executive Chairman

Charoen Pokphand Group

Company Limited

Dr. Ajva Taulananda Vice Chairman 67 - 1992-Present Vice Chairman


Limited

Vice Chairman


Company Limited

Chairman

The Thai Chamber of Commerce

and Board of Trade of Thailand

1993-1999 Director and President


Limited

1991-1992 Duputy Minister

Ministry of Agriculture and

Cooperatives


(31/12/47)



(31/12/47)

Mr. Chaleo Souvannakitti Vice Chairman 76 3,500,000 shares 1992-Present Vice Chairman


Limited

Director

Telecom Holding Company Limited

Mr. Athueck Asvanund* Vice Chairman 53 - 1997-Present Vice Chairman and

and Group General Counsel

Group General True Corporation Public Company

Counsel Limited

Director


Director

True Multimedia Company Limited

Group General Counsel


Company Limited

Director

CP Seven Eleven Corporation


Director

United Broadcasting Corporation


2002-Present Director

TA Orange Company Limited

Present Director

Aqua-Agri Foods

International, Inc.

1978-1997 Baker & McKenzie

* Authorized Signatory




(31/12/47)

Mr. Supachai Director, 37 1,240,000 shares 1999-Present Director, President and

Chearavanont* President Chief Executive Officer

and True Corporation Public Company

Chief Executive Limited

Officer 1992-1999 Director and Senior Executive

Vice President


Limited

Mr. Soopakij Director 40 - 1992-Present Director

Chearavanont* True Corporation Public Company

Limited

2000-Present Executive Chairman

Telecom Holding Company

Limited

1998-Present Chairman



1991-Present Chairman

Lucent Network Technology

(Thailand) Limited



(31/12/47)

Mr. Chatchaval Director 42 - 1993-Present Director and Managing Director

Jiaravanon* and Group Investment

Managing True Corporation Public Company

Director Limited

Group 2001-Present Director and Member of Audit

Investment Committee

Ticon Industrial Connection


2000-Present President and C.E.O.

Telecom Holding Company

Limited

Independent Director

Cal-Comp Electronics (Thailand)



Cambodia Mobile Telephone

Company Limited

1997-Present C.E.O.,


True Internet Company Limited

Asia Infonet Company Limited


Thai Kodama Company Limited


Metro Machinery Public

Company Limited





(31/12/47)

Mr. Vichaow Director 47 - 2000-Present Director, Managing Director and

Rakphongphairoj* Managing Chief Operating Officer

Director True Corporation Public Company

and Limited

Chief Operating 1998-2000 E.V.P., Business & Enterprise

Officer True Corporation Public Company

Limited

1997-1998 E.V.P., Central Operation &

Information Technology


Limited

1996-1997 Region Director,

Bangkok-Southeast Region


Limited


Bangkok-West Region


Limited


Mr. Umroong Director 51 384,000 shares 2001-Present Director

Sanphasitvong True Corporation Public Company

Limited

Present Deputy Group CFO


Company Limited

Director

C.P. Seven Eleven Public

Company Limited

Director

Vinythai Public Company Limited

Director

Ayudhya Allianz C.P. Public

Company Limited

Director

CPPC Public Company Limited

Mr. Heinrich Heims Director 53 - 2000-Present Director


Limited

2004-Present COO / Member of the Board

of Managing Directors of

KfW IPEX-Bank

1998-Present Senior Vice President - Export

and Project Finance KfW

1978-1998 Export Finance

KfW


(31/12/47)



(31/12/47)

Mr. Klaus Tuengeler Director 63 - 2000-Present Director


Limited

Present First Vice President-Export and

Project Finance

Telecommunications, Natural

Resources

KfW

Mr. Claus Stadler Director 46 - 2000-Present Director


Limited

Present Deputy General Counsel, Head of

the Legal Department (Frankfurt)

KfW

Mr. Andreas Klocke Director 48 3,500 shares 2000-Present Director

True Corporation Public

Company Limited

Present Head of KfWûs South-East Asia

Regional office in Bangkok in

Charge of KfW Affairs in Thailand

and South- East Asia Region



(31/12/47)

Mr. Harald Link Director 49 50,000 shares 2000-Present Director


Limited

1987-Present Managing Partner

B. Grimm & Co. R.O.P.

Chairman

B. Grimm Group of Companies

1981-1986 Director, Executive Committee


1979-1980 Assistant to Managing Partner


Dr. Lee G. Lam Director 45 - 2003-Present Director


Limited

Vice Chairman / President &

CEO

Chia Tai Enterprises International

Limited


BOC International Holdings

Limited (çBOCIé)

1999-2001 Executive Director

Singapore Technologies Telemedia

1998-1999 Partner-in-charge

Heidrick & Struggles

1996-1998 President & CEO

Millicom International Cellular Asia

Pacific Operations

1993-1995 Managing Partner

A.T. Kearney, Inc.

1989-1993 General Manager

Cable & Wireless/Hongkong

Telecom

1981-1989 Senior Executive

Bell Canada


Mr. Supachai Director, 37 1,240,000 shares 1999-Present Director, President and

Chearavanont President Chief Executive Officer


Chief Executive Limited

Officer 1992-1999 Director and Senior Executive

Vice President


Limited

Mr. Vichaow Director 47 - 2000-Present Director, Managing Director and

Rakphongphairoj Managing Chief Operating Officer


Chief Operating Limited

Office 1998-2000 E.V.P., Business & Enterprise


Limited

1997-1998 E.V.P., Central Operation &

Information Technology


Limited


Bangkok-Southeast Region


Limited


Bangkok-West Region


Limited


(31/12/47)

Executive Officersû Information (As of 31st December 2004)



(31/12/47)

Mr. Chatchaval Jiaravanon Director 42 - 1993-Present Director and Managing Director-

and Group Investment

Managing True Corporation Public Company

Director Limited

Group 2001-Present Director and Member of

Investment Audit Committee

Ticon Industrial Connection


2000-Present President and C.E.O.


Independent Director

Cal-Comp Electronics (Thailand)



Cambodia Mobile Telephone

Company Limited

1997-Present C.E.O.


True Internet Company Limited

Asia Infonet Company Limited


Thai Kodama Company Limited


Metro Machinery Public

Company Limited



(31/12/47)

Mr. Athueck Asvanund Vice Chairman 53 - 1997-Present Vice Chairman and

and Group General Counsel

Group General True Corporation Public Company

Counsel Limited

Director


Director


Group General Counsel


Company Limited

Director

CP Seven Eleven Corporation


Director





Present Director

Aqua-Agri Foods

International, Inc.

1978-1997 Baker & McKenzie

Mr. William E. Harris Chief Financial 42 100,000 shares 2001-Present Chief Financial Officer

Officer True Corporation Public

Company Limited

1998-2000 Executive Vice President -

Corporate Finance

True Corporation Public

Company Limited

1993-1998 Director

Credit Policy, Verizon Communi-

cations, Philadelphia



(31/12/47)

Mr. Adhiruth Managing 42 - 2003-Present Managing Director-Office / SME

Thothaveesansuk Director Solution & Wireless Access

Office / SME True Corporation Public Company

Solution & Limited

Wireless Access Acting President

Asia Wireless Communication

Company Limited

2002 Chief Commercial Officer


2001 Executive Vice President


Limited

1998-2002 General Manager

Wire & Wireless Company Limited

1998-2001 President

Asia Wireless Communication

Mr. Songtham Managing 47 100,000 shares Present Managing Director - Corporate

Phianpattanawit Director Solution, Wholesales & Data

Corporate True Corporation Public Company

Solution, Limited

Wholesales & Executive Director - Corporate

Data Solution


Acting President


Acting President

Wire & Wireless Company Limited

President

True Internet Data Center

Company Limited



(31/12/47)

2001-2003 Country General Manager / MD

IBM Thailand Company Limited

Chairman

IBM Solution Delivery Company

Limited

2001-2002 Director

IBM Storage Product Thailand

Company Limited

2000 Director, Sales & Marketing


Country Manager, System Sales


1998 Country Manager Finance &

Administration and CFO


1997 Service Business Executive




(31/12/47)

Mr. Thiti Nantapatsiri Managing 51 - Present Managing Director- Home /

Director Consumer Solution &

Home / Highspeed Access

Consumer True Corporation Public Company

Solution & Limited

Highspeed 1999-2003 Executive Vice President

Access Loxley Public Company Limited


Hutchison CAT Wireless Multimedia

Company Limited


Hutchison Telecommunications

(Thailand) Company Limited

1997-1999 First Senior Vice President

Loxley Public Company Limited


The Company Directorsû Shareholding in TRUEûs affiliates as at 31st December 2004 are as follows:

Director Company Change Outstandingin 2004 Share(s)

Mr. Dhanin Chearavanont Telecom Holding Co., Ltd. - 1

Bangkok Inter Teletech Co., Ltd. - 1

Mr. Sumet Jiaravanon Bangkok Inter Teletech Co., Ltd. - 1

Mr. Chaleo Souvannakitti Telecom Holding Co., Ltd. - 1

Telecom International Co., Ltd. - 1

Telecom Equipment - 1

Manufacturing Co., Ltd.

Dr. Ajva Taulananda Telecom International Co., Ltd. - 1

Telecom Training and - 1

Development Co., Ltd.



U-Net Co., Ltd. - 1

True Internet Co., Ltd. - 1

(Formerly named Asianet

Corporation Co., Ltd.)

Asia DBS Public Company Limited - 1

Asia Infonet Co., Ltd. - 1

Asia Wireless Communication Co., Ltd. - 1

True Multimedia Co., Ltd. - 1

(Formerly named Asia

Multimedia Co., Ltd.)

N.T.U. (Thailand) Co., Ltd. - 1

Mr. Chatchaval Jiaravanon Telecom International Co., Ltd. - 1



Wire & Wireless Co., Ltd. - 5


Director Company Change Outstanding in 2004 Share(s)

U-Net Co., Ltd. - 1








(Formerly named Asia

Multimedia Co., Ltd.)

Yai Kaew Co., Ltd. - 1

Mr. Soopakij Chearavanont Telecom International Co., Ltd. - 1



U-Net Co., Ltd. - 1








(Formerly named Asia Multimedia Co., Ltd.)

Mr. Supachai Chearavanont Telecom Holding Co., Ltd. - 1

Telecom International Co., Ltd. - 1

Telecom Training and - 1

Development Co., Ltd.



Wire & Wireless Co., Ltd. - 5


Director Company Change Outstanding in 2004 Share(s)

U-Net Co., Ltd. - 1









T-Pay Co., Ltd. 1 1

Mr. Athueck Asvanund NC True Co., Ltd. - 1

T-Pay Co., Ltd. 1 1

Mr. Harald Link Telecom Equipment 480,000 480,000


Mr. Vichaow Telecom International Co., Ltd. - 1

Rakphongphairoj Telecom Equipment - 1


U-Net Co., Ltd. - 1









K.I.N. (Thailand) Co., Ltd. - 1

T-Pay Co., Ltd. 1 1


During 2004, the Group carried out the transactions with subsidiaries, associates, joint ventures and related companies

and persons as disclosed in the Note 4, Note 9, Note 12, Note 17, Note 22 and Note 32 to financial statements for year

ended 31st December 2004.

Measures and Procedures for Approving the Entering into of Connected Transactions

The Company has measures and procedures for approving the entering into the connected transactions in compliance

with the Rules and Regulations of the office of Securities and Exchange Commission (çSECé) and the Stock Exchange of

Thailand (çSETé), and the provisions of the Public Companies Act, i.e. related party transactions must obtain approval from

the Independent Directors. If any related party transaction is deemed to be a connected transaction, said transaction must

obtain approval from the Audit Committee, the Board of Directors and/or Shareholders Meeting as the case may be,

according to the Regulation of the Stock Exchange of Thailand. Moreover, the Company must comply with the terms and

conditions of the Common Terms Agreement First Amendment and Restatement Agreement dated 14th October 2003 which

is the principal debt agreements executed between the Company and its Secured Creditors, and related agreements. The

key terms and conditions in said Agreement and related agreements with regard to connected transactions specify that the

Company shall not enter into any contract, agreement, or arrangement with any affiliates other than on armsû length open

market terms. Apart from the foregoing obligation, the terms and conditions of the Shareholders Agreement executed with

Kreditanstalt für Wiederaufbau dated 22nd December 1999 specify that the Company shall have to disclose the entering into

any connected transactions of the major shareholders or its affiliates.

Policy for Future Connected Transactions

In addition, in order to strictly comply with the rules and regulations of the SEC and the SET, the Company has applied

said rules and regulations in implementing an internal guideline for connected transactions by undertaking a comparative

study of the connected transactions guidelines from various foreign institutions to enhance transparency and create parallel

understanding with foreign analysts and investors. With regard to future connected transactions, the Company anticipates

that there will be connected transactions in the ordinary course of business of the Company with its affiliates and the

Company shall proceed with such transactions in a transparent manner pursuant to the good corporate governance policy

of the Company as well as all relevant regulations.


1. Audit fees

The Company and subsidiaries paid for audit fees of Baht 13,431,000 for the year 2004 to appointed auditing firm.

2. Other non-audit fees

The Company paid for other non-audit fees, i.e. engagement to perform agree-upon procedures and IT internal audit

consulting services to appointed auditing firm. The fee amount of Baht 2,208,000 was paid during the year and the remaining

amount of Baht 366,800 was carried forward to the following year upon the completion of work.


By virtue of a resolution of the Board of Directors of the Company passed at its meeting No. 1/2546 held on 27th

February 2003, the Audit Committee was re-appointed to perform duties and discharge responsibilities under the charter for

the Audit Committee. During the year 2004, the Audit Committee proceeded as follows:

1. held 8 committee meetings in 2004 in order to discharge its functions as assigned by the Board of Directors. The

management was invited to provide extra information in certain agenda items. The Audit Committee reported its

activities to the Board of Directors on a quarterly basis;

2. considered and proposed the appointment and remuneration of PricewaterhouseCoopers ABAS Limited as the

Companyûs external auditor for the year 2005;

3. reviewed the quarterly and annual financial reports of the Company and its subsidiaries to ensure correctness,

reliability and adequacy of information disclosed, reflecting good corporate governance;

4. acknowledged the Audit Plan and external auditorûs findings and provided recommendations;

5. considered the internal audit plan under risk-based approach and the monthly, quarterly and annual results as well as

submitted suggestions on actions to be taken by the management, and also on following up the progress of these actions;

6. regularly reviewed the Companyûs and its subsidiariesû practices relating to connected transactions to ensure

compliance with the regulations of the Stock Exchange of Thailand;

7. closely monitored the work progress of Internal Audit Department in order to enhance effectiveness of the internal

audit function and continuously ensured that the Company improved its internal controls system to enhance

efficiency and effectiveness and ensure appropriate compliance with applicable regulatory requirements;

Towards this end, the Management upon the recommendation of the Audit Committee engaged

PricewaterhouseCoopers Risk Management Services Limited to provide IT internal audit consulting services which aim

for development of the standards and performance of the IT internal audit activities. In this regard, the Audit Committee

has been closely monitoring the progress of the consulting services project which was completed in 2004.

This project, which has achieved its purpose, is an essential step in strengthening the IT internal audit function

of the Company;

8. initiated a synergic combination of TRUE and TA Orange Internal Audit functions. In view of such synergy,

the combined Internal Audit Department will be further strengthened and more effective towards attaining its goals.

(Mr. Vitthya Vejjajiva)



The Board of Directors is responsible for the financial statements of the Company and its subsidiaries. The

aforementioned financial statements have been prepared in accordance with Generally Accepted Accounting Principles, using

appropriate accounting policy consistently employed by the Company as well as applying careful judgment and best

estimation. Important information is adequately disclosed in the notes to financial statements.

The Board of directors has provided and maintained an efficient internal controls system to ensure that accounting

records are accurate, complete and adequate to protect its assets.

To accomplish this task, the Board of Directors has appointed an Audit Committee, which consists of Independent

Directors responsible for the quality of financial statements and internal controls system, whose comments on these issues

are readily included in the Audit Committee Report in this Annual Report.

The Board of Director is of the opinion that the Companyûs overall internal controls system is adequate and suitable and

has rendered credibility and reliability to the financial statements of the Company and its subsidiaries for the year ended 31st

December 2004.


31 December 2004


The accompanying notes on pages 102 to 158 are an integral part of these financial statements.

TRUE : Annual Report 2004

Documents

Transcript of TRUE : Annual Report 2004