11 August 2010 The President The Stock Exchange of Thailand Dear Sir/Madam, Re: Management Discussion and Analysis on the second quarter 2010 financial performance Berli Jucker Public Company Limited ("BJC") is pleased to announce its 2Q10 earnings results. In 2Q10, sales were THB 6,185 million, representing an increase of 12.0% YoY and 1.6% QoQ. Operating profit in 2Q10 was THB 757 million, a significant improvement of 85.1% YoY but a slight decrease of 1.7% QoQ. Net profit for the quarter was THB 562 million, a significant increase of 102.2% YoY but a decrease of 3.3% QoQ. Net profit attributable to equity holders of the company was THB 478 million, a significant increase of 74.5% YoY but a decrease of 7.4% QoQ. In addition to presenting financial performance of organic operations, BJC is pleased to announce the closing of the share acquisition of Malaya Glass Products Sdn., Bhd. from Fraser & Neave Holdings Bhd. on 16 July 2010, which BJC jointly executed the Share Purchase Agreement with a strategic joint venture partner on 14 May 2010. The financial consolidation and restatement will be reflected and presented in 3Q10 onward. Sales breakdown is as follows: THB MM 2Q10 2Q09 %YoY 1Q10 %QoQ Industrial Supply Chain 3,054 2,431 25.6 3,022 1.1 Consumer Supply Chain 1,880 1,781 5.6 1,864 0.9 Healthcare & Technical Supply Chain1,070 1,128 (5.1) 1,060 0.9 International Business Group 89 94 (5.3) 60 48.3 Information Technology 92 86 7.0 82 12.2 Total Sales 6,185 5,520 12.0 6,089 1.6O ther income 69 50 38.0 72 (4.2) Total Revenue 6,255 5,570 12.3 6,160 1.5O perating profit 757 409 85.1 770 (1.7) % margin 12.1 7.3 4.8 12.6 (0.5) Net profit 562 278 102.2 581 (3.3) % margin 9.0 5.0 4.0 9.5 (0.5) Attributable to : Minority interest 84 4 2,000.0 65 29.2 Equity holders of the Company 478 274 74.5 516 (7.4) % margin 7.6 4.9 2.7 8.5 (0.9) Note: 1) For the purpose of the Management Discussion and Analysis, the financial results of the Technical and Healthcare Supply Chains are jointly reported, consistent with historical reporting format. By the same token, the performance of the International Business Group is reported separately from the other supply chains. 2) %YoY and %QoQ changes for operating margin, net profit margin, and net profit margin attributable to equity holders of the Company denote the absolute changes YoY and QoQ respectively. 3) The performance of 2Q09 reflected the restatement after acquiring 17% of the paid-up capital of T.C.C. Technology Company Limited (TCCT) on 8 July 2009 (BJC is currently holding 51% of the paid-up capital). Industrial Supply Chain THB MM 2Q10 2Q09 %YoY 1Q10 %QoQ Sales 3,054 2,431 25.6 3,022 1.1 Net profit 362 69 424.6 323 12.1 % margin 11.8 2.8 9.0 10.7 1.1 Note: %YoY and %QoQ changes for net profit margin denote the absolute changes YoY and QoQ respectively. The Industrial Supply Chain reported sales of THB 3,054 million, representing an increase of 25.6% YoY and 1.1% QoQ. The YoY increase was from positive sales growth of Glass Packaging,Aluminum Can Packaging and Galvanized Steel Structures businesses. The slight QoQ increase was attributed to ongoing growth momentum of Glass Packaging and Aluminum Can Packaging businesses. Net profit in this quarter was THB 362 million, a significant improvement of 424.6% YoY and 12.1% QoQ. The net profit margin of 11.8% continued to improve from 2.8% in 2Q09 and from 10.7% in 1Q10. The significant and continuing improvement in earnings of Glass Packaging and Aluminum Can Packaging businesses primarily contributed to prominent increase in net profit from the same period last year of the Industrial Supply Chain. The Glass Packaging business reported an increase in sales YoY but a small decrease QoQ. Sales of all segments except beverage segment increased YoY. The QoQ decrease was mainly from the season effect. The downward trend of key raw material prices, such as soda ash and cullet, and productivity improvement remained the key factors attributing to higher profitability from 2Q09 while the aforementioned factors were approximately at the same level as 1Q10. Sales of the Aluminum Can business continued to increase both YoY and QoQ. All key financials representing profitability and profitability ratios showed the improvement both YoY and QoQ. Sales improvement YoY and QoQ were attributed to increases in volume sales, especially in domestic market. Concurrently, the improvement in net profit YoY and QoQ was due to higher efficiency & asset utilization, more manageable cost of key raw material as the market price of aluminum (LME price) has been less volatile, and lower provision expenses for inventory impairment. For other businesses, the Galvanized Steel Structures business reported significant improvement in sales and net profit growth both YoY and QoQ from higher sales of transmission line and galvanized steel structure products and services. In addition, the business has recovered from the delay of project commencement last year due to the poor economic conditions. On the other hand, the Engineering Products & Services business reported a decrease in sales and net profit both YoY and QoQ. Consumer Supply Chain THB MM 2Q10 2Q09 %YoY 1Q10 %QoQ Sales 1,880 1,781 5.6 1,864 0.9 Net profit 89 99 (10.1) 120 (25.8) % margin 4.7 5.6 (0.9) 6.4 (1.7) Note: %YoY and %QoQ changes for net profit margin denote the absolute changes YoY and QoQ respectively. In 2Q10, the Consumer Supply Chain reported sales of THB 1,880 million, an increase of 5.6% YoY and 0.9% QoQ. All businesses except Foods business reported positive sales growth YoY. In addition, YoY sales growth was particularly strong in Personal Care & Cosmetic and 3rd party Distribution businesses. Compared to 1Q10, sales of Personal Care & Cosmetic, 3rd party Distribution and Contract Manufacturing businesses increased, while sales of Foods and Tissue businesses decreased. Net profit was THB 89 million, a decrease of 10.1% YoY and 25.8% QoQ, which was mainly attributed to unfavorable performance of Foods and Tissue businesses. Meanwhile, net profits of Personal Care & Cosmetic and other businesses continued to show strong growth momentum. In 2Q10, Foods business reported weaker sales and net profit both YoY and QoQ since the business had been impacted by weakening consumer demand from the political unrest since April 2010.In addition, the ongoing turmoil including the curfew in May 2010 had interrupted sales and distribution activities, especially in Bangkok and metropolitan areas. Besides, the poor performance of "Tasto" potato chips, the highest contribution to total sales, from intensifying competitions and from softening momentum of new flavor launched at the end of 1Q10 was also one of the main reasons for weak 2Q10 performance. Nonetheless, the good consumer acceptance in "Campus Choco Drink" chocolate flavored drink, launched in May 2010 had complemented the weak performance due to uncontrollable factors in this quarter. The introduction of Campus Choco Drink reiterated the strong "Campus" brand value and was considered another significant milestone for BJC owned-brand product. Sales of Tissue business increased YoY but decreased QoQ while net profit decreased both YoY and QoQ. Same as Foods business, Tissue business had been negatively impacted by the disruption in sales and distribution from the political unrest. However, the highest contribution to total sales "Cellox" tissue reported an increase in sales YoY and approximately the same as in 1Q10. In particular, June 2010 sales were the highest sales record in year 2010 to date. The competitive environment remained high in this quarter, through price cutting as well as on-pack premium promotion, despite increasing paper pulp price, which reflected in lower net profit both YoY and QoQ. On the other hand, despite the political unrest, the performance of Personal Care & Cosmetics business remained strong. Sales increased both YoY and QoQ while net profit increased YoY and was approximately at the same level as 1Q10. The strong performance of "Parrot" soap was primarily attributed to successful marketing and promotion activities, especially the promotion for "Parrot Botanicals Shower Cream", a new product launched end of January 2010. Meanwhile, "Dermapon" baby shower gel also reported positive earnings growth as a result of ongoing focus on branding and marketing activities since BJC acquired the brand license in July 2008. Same as Personal Care & Cosmetics, the performance of Distribution and Contract Manufacturing services remained strong attributed to both internal and external customers. Sales of "Kato", fruit juice with Nata De Coco, in April 2010 were the second consecutive month record high. In addition, the business constantly searches for new products and services to offer to the 3rd party for Contract Manufacturing services, which in turn reflected in higher factory utilization rate and sales both YoY and QoQ, For Logistic business, revenue and net profit increased both YoY and QoQ, mainly from warehouse and transportation services. Revenue from warehouse and transportation services of the customers within the group company remained the majority and as a ratio to revenues from the external customers remained approximately at the same both YoY and QoQ. Meanwhile, the average storage utilization increased both YoY and QoQ. Healthcare and Technical Supply Chain THB MM 2Q10 2Q09 %YoY 1Q10 %QoQ Sales 1,070 1,128 (5.1) 1,060 0.9 Net profit 94 116 (19.0) 113 (16.8) % margin 8.8 10.3 (2.1) 10.7 (1.9) Note: %YoY and %QoQ changes for net profit margin denote the absolute changes YoY and QoQ respectively. The Healthcare and Technical Supply Chain reported 2Q10 sales of THB 1,070 million, a decrease of 5.1% YoY but a slight increase of 0.9% QoQ. YoY decrease was primarily due to poor performance of the Healthcare Supply Chain as a result of "Thai Khem Kaeng" scheme suspension in selected hospitals. Net profit of THB 94 million represented a decrease of 19.0% YoY and 16.8% QoQ. The suspension of Thai Khem Kaeng in 2Q10 had primarily impacted on sales and net profit of the Healthcare Supply Chain both YoY and QoQ, especially on the performance of the Medical Equipment Division and Medical Imaging Division. The latest suspension caused the hospitals to switch the budget spending from Thai Khem Kaeng to the annual budgets which are normally approved in October, which should help relieving the earnings pressure in the second half of 2010. In addition, the political unrest had interrupted the pharmaceutical products shipment, together with ongoing competition through price cutting, resulted in lower sales of the Medical Product Division both YoY and QoQ. For the Technical Supply Chain, sales of all businesses increased YoY while all businesses except Stationery & Office Supply business increased QoQ. Net income of all businesses except Stationery & Office Supply business increased YoY and QoQ. Graphics business reported outstanding sales in 2Q10 and showed the improvement both YoY and QoQ. Sales were particularly strong in April 2010 from HP machine installation. In addition, the strong sales performance in this quarter was attributed to the improvement across all key products except film and photo printers. Similar to the Graphics business, sales of the Specialties business increased both YoY and QoQ, mainly from food ingredients and industrial ingredients. Sales of the Stationery & Office Supply business increased YoY from the improvement of the economic conditions yet decreased QoQ from the school break season in April and political unrest that had resulted in the delay of back-to-school period and in the suspension of purchase orders from modern trades. Key Highlights of 2Q10 Income Statement THB MM 2Q10 2Q09 %YoY 1Q10 %QoQ Sales & Service 6,185 5,520 12.0 6,089 1.6 Other income 69 50 38.0 72 (4.2) Total Revenues 6,255 5,570 12.3 6,160 1.5 Cost of goods sold 4,466 4,153 7.5 4,398 1.5 Gross profit 1,719 1,367 25.7 1,691 1.7 Selling & Administrative expenses 1,032 1,008 2.4 993 3.9 Operating profit 757 409 85.1 770 (1.7) Interest expense (income) 44 56 (21.4) 35 25.7 Share of profits from investments 19 21 (9.5) 19 - Earnings before tax 732 374 95.7 754 (2.9) Tax 170 96 77.1 174 (2.3) Net profit 562 278 102.2 581 (3.3) Attributable to : Minority interests 84 4 2,000.0 65 29.2 Equity holders of the Company 478 274 74.5 516 (7.4) EBITDA 1,112 764 45.5 1,123 (1.0) Key Ratios (%) 2Q10 2Q09 %YoY 1Q10 %QoQ Gross profit margin 27.8 24.8 3.0 27.8 - SG&A as % of sales 16.7 18.3 (1.6) 16.3 0.4 Operating profit margin 12.2 7.4 4.8 12.6 (0.4) Net profit margin (attributable to 7.7 5.0 2.7 8.5 (0.8) equity holders of the Company) EBITDA margin 18.0 13.8 4.2 18.4 (0.4) Note: %YoY and %QoQ changes for gross profit margin, SG&A of sales, operating profit margin, net profit margin, net profit margin attributable to equity holders of the Company and EBITDA margin denote the absolute changes YoY and QoQ respectively. Sales BJC reported 2Q10 sales of THB 6,185 million, representing an increase of 12.0% YoY and 1.6% QoQ. All Supply Chains except the Healthcare Supply Chain and the International Business Group reported higher sales YoY and QoQ. Sales of the Industrial Supply Chain represented 49% of total sales while sales of the Consumer Supply Chain represented 30% of total sales, altogether remained two largest Supply Chains base on the sales contribution. Gross Profit In 2Q10, gross profit was THB 1,719 million, a significant increase of 25.7% YoY but a small increase of 1.7% QoQ. Both YoY and QoQ improvement was mainly attributed to higher gross profit of the Industrial Supply Chain, as a result of lower prices of key raw materials and higher productivity, and the Technical Supply Chain, as a result of Graphics and Specialties businesses. The increasing market price of paper pulp since end of 2009 has continued to have a pressure on the profitability of the Tissue business and thereby has an impact on profitability of the Consumer Supply Chain. Consequently, the overall gross profit and gross margin were around the same as 1Q10. However, 2Q10 gross margin of 27.8% remained significantly higher than 2Q09 gross margin of 24.8%. Selling and Administrative Expenses ("SG&A") Selling and administrative expenses in 2Q10 were THB 1,032 million, an increase of 2.4% YoY and 3.9% QoQ. Both YoY and QoQ increases were primarily attributed to higher SG&A of the Industrial Supply Chain and the Technical Supply Chain in accordance with sales increase. Net Profit 2Q10 net profit for the quarter was THB 562 million, a significant increase of 102.2% YoY but a decrease of 3.3% QoQ. The net profit attributable to equity holders was THB 478 million, a significant increase of 74.5% YoY but a decrease of 7.4% QoQ. Net profit margin attributable to equity holders was 7.7%, an increase from 5.0% in 2Q09 but a decrease from 8.5% in 1Q10. Debt to Equity Ratio (x times) 2Q10 1Q10 4Q09 3Q09 2Q09 Liabilities / Equity 0.81 0.92 1.03 1.06 1.08 Interest-bearing Debt / Equity 0.38 0.46 0.53 0.57 0.57 2Q10 liabilities-to-equity-ratio was 0.81x, a decrease from 0.92x in 1Q10, while the interest-bearing-debt-to-equity-ratio was 0.38x, a decrease from 0.46x in 4Q09. The decline was primarily from the net debt repayment of Thai Glass Industries Plc., Thai Beverage Can Ltd., and Berli Jucker Food Ltd.. BJC's liquidity position remains strong and the interest-bearing-debt-to-equity-ratio remains significantly below the debenture covenant of 1.75x. Please be informed accordingly. Yours faithfully, Berli Jucker Public Company Limited Thirasakdi Nathikanchanalab Aswin Techajareonvikul Director Director