PRESS RELEASE BERLI JUCKER REPORTS 63 PERCENT INCREASE IN NET INCOME FOR THE FIRST QUARTER Berli Jucker Public Company Limited announced its results for the first quarter today: Net income for the first three months of 1999 increased by 63 percent to Baht 189 million, reflecting the resilience of its core businesses, particularly in the packaging sector. Total consolidated sales decreased by 3 percent to Baht 2,739 million when measured against the first quarter of 1998, which was the strongest quarter of the preceding year, but increased by 8 percent when compared with the last quarter of 1998. The Group's gross margin rose to 28.0 percent compared with a gross margin of 25.5 percent in the first quarter of 1998, reflecting some restoration of historical margins and the absence of foreign exchange volatility. Berli Jucker's President and Chief Executive Officer, Mr. David J. Nicol, commented: "I am pleased to report that the first quarter of this year has started on such a positive note. The majority of our business lines have fared reasonably well; although the level of sales is still disappointingly low, it is pleasing to see a slight recovery from the levels experienced in the latter half of 1998. Sales of Consumer Products increased by 4 percent to Baht 753 million, led by strong growth in the Personal Care and Cosmetics lines, particularly in our own soap brand Parrot, which has expanded its number of variant lines. Parrot Soap sales have more than doubled since the early part of 1998 although there is significant competition in the market place. We will add to our brand visibility by introducing Parrot Shampoo in the second quarter of this year. Tissue paper sales have been somewhat disappointing, with slight sales decreases compared with a very strong first quarter of 1998. Our capacity expansion plan at Cellox Paper Company Limited is now complete and we will look to dispose of older, less efficient machinery and boost our export capability. Snack foods sales have held up well during the quarter, on the back of a growing trend away from traditional products towards potato chips. Our Tasto potato chip brand has a reasonable share of the market and did particularly well in March as our potato planting program began to grow in momentum. Confectionery products, manufactured and distributed by Berli Jucker on behalf of principals, enjoyed steady sales, whilst the sales of Wine proved bouyant throughout the holiday periods. Net income contribution increased by 4 percent, due principally to the success of the Parrot product. The Technical Products group saw a slight decline of 3 percent in sales to Baht 855 million, with Thai Klinipro, our medical gown manufacturing subsidiary which exports to Europe, being the greatest sales element. Whilst the Chemical and Medical Products groups had sales approximating those of the comparative period, sales of our Photographic and Imaging products were disappointing due to weak demand and competitive pressures; however we are expanding our coverage for these products in areas outside Bangkok and have introduced a new tropical proof colour film which has proved popular. The net income contribution of the Technical Products group decreased due to margin pressure and the increased cost of promoting our products. The Packaging group, led by Thai Glass Industries, achieved a 4 percent sales growth to Baht 1,050 million. Net income contribution rose due to the combination of margin recovery at Thai Glass Industries and our increased share in that company, which now stands at 98 percent compared with 66 percent in early 1998. There has been a significant increase in the number of beer and whisky bottles produced; we manufactured over 134 million beer bottles during the quarter which is a 24 percent improvement over 1998. This increase has however been offset by the continuing depressed sales of energy drink bottles. Thai Glass Industries was also successful in boosting its sales of food containers, particularly for ketchup, food essence and seasoning lines. Berli Prospack, our manufacturer of rigid plastic containers, continued to experience a difficult time; the company's products cater mainly for the personal care and lubricant oil sectors which have been hard hit by the recession. The Engineering group saw a 65 percent decrease in sales to Baht 73 million. Whilst Berli Jucker's Engineering Division continued to be profitable, many projects are taking longer to complete than anticipated, leading to delayed billings. Thai Scandic Steel, the Group's manufacturer of galvanised towers for use in the electricity and telecommunication sectors, has still not overcome the difficulties it faced during the latter part of 1998. Delays in commencing significant contracted works were experienced due to customer wishes to defer these contracts; this does not assist Thai Scandic Steel which still has to maintain its workforce and facilities in a state of readiness. Unless these problems can be overcome, the future viability of this company must be brought into question. The Group's Engineering businesses were unable to contribute to profits during the quarter, unlike the comparative period in 1998 when unhedged foreign currency exposures benefited from the strengthening of the Baht and previously booked losses were recovered in respect of our investment in Siemens Limited. Our performance during the quarter has been helped by the absence of any major foreign exchange loss, since approximately 98 percent of our foreign currency debt exposure is hedged. In addition, we have enjoyed substantial interest income from our increasing cash resources. Net debt represents only 23 percent of shareholder equity at present, compared with 127 percent at this time last year. Berli Jucker is therefore well placed to expand its balance sheet, if necessary, in pursuit of its acquisition agenda." Looking ahead, Mr. Nicol went on to say: "The first quarter of 1999 has started well; I see no reason why this trend should not continue for the remainder of the year. We have seen a slight increase in sales volumes compared with the latter half of 1998, which may reflect growing domestic economic activity, and we are hopeful this will continue. The recent Government measures to reduce the rate of value added tax, together with recent bank recapitalisation plans, should boost the domestic economy; Berli Jucker is well placed to benefit from these improvements." May 17, 1999 For further information please contact: David J. Nicol: Tel 367 1024 Blair Sinton: Tel 367 1026 President and Chief Executive Officer Chief Financial Officer E-mail: davidnicol@berlijucker.co.th E-mail: blair@berlijucker.co.th