Synnex (Thailand) Public Company Limited and its Subsidiary

Synnex (Thailand) Public Company Limited and its Subsidiary

Interim financial statements and

Independent Auditor’s Report on Review of Interim Financial Information

For the three-month and six-month periods ended

30 June 2012

Independent Auditor’s Report on Review of Interim Financial Information To the Board of Directors of Synnex (Thailand) Public Company Limited I have reviewed the accompanying consolidated and separate statements of financial position of Synnex (Thailand) Public Company Limited and its subsidiary, and of Synnex (Thailand) Public Company Limited, respectively, as at 30 June 2012; the consolidated and separate statements of comprehensive income for the three-month and six-month periods ended 30 June 2012 and 2011; the consolidated and separate statement of changes in equity and cash flows for the six-month periods ended 30 June 2012 and 2011; and condensed notes (“interim financial information”). Management is responsible for the preparation and presentation of this interim financial information in accordance with Thai Accounting Standard 34, “Interim Financial Reporting”. My responsibility is to express a conclusion on this interim financial information based on my review. Scope of Review I conducted my review in accordance with the Thai Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity”. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Thai Standards on Auditing and consequently does not enable me to obtain assurance that I would become aware of all significant matters that might be identified in an audit. Accordingly, I do not express an audit opinion. Conclusion Based on my review, nothing has come to my attention that causes me to believe that the accompanying interim financial information is not prepared, in all material respects, in accordance with Thai Accounting Standard 34, “Interim Financial Reporting”.

2

The comparative consolidated and separate statement of financial position as at 31 December 2011 I have previously audited the consolidated and separate financial statements of Synnex (Thailand) Public Company Limited and its subsidiary, and of Synnex (Thailand) Public Company Limited, respectively, for the year ended 31 December 2011 in accordance with Thai Standards on Auditing and expressed an unqualified opinion on those financial statements in my report dated 20 February 2012. The consolidated and separate statements of financial position as at 31 December 2011, which are included in the accompanying interim financial information for comparative purposes, are components of those financial statements. I have not performed any auditing procedures since the date of my audit report. (Bunyarit Thanormcharoen) Certified Public Accountant Registration No. 7900 KPMG Phoomchai Audit Ltd. Bangkok 13 August 2012


Assets Note 30 June 31 December 30 June 31 December

2012 2011 2012 2011

(Unaudited) (Unaudited)

Current assets

Cash and cash equivalents 105,640 89,477 98,938 86,647

Trade accounts receivable 3,4 3,184,627 2,154,614 3,178,818 2,149,294

Inventories 5 1,947,959 1,448,649 1,941,821 1,447,622

Rebate receivable 261,736 181,843 261,736 181,843

Other current assets 118,642 123,776 118,054 123,757

Total current assets 5,618,604 3,998,359 5,599,367 3,989,163

Non-current assets

Investment in subsidiary 6 - - 8,000 8,000

Other long-term investment 28,060 34,748 28,060 34,748

Property, plant and equipment 7 323,630 333,744 321,453 332,122

Other non-current assets 12,661 13,634 12,620 13,608

Total non-current assets 364,351 382,126 370,133 388,478

Total assets 5,982,955 4,380,485 5,969,500 4,377,641

(in thousand Baht)

Statements of financial position

As at 30 June 2012 and 31 December 2011

Consolidated

financial statements

Separate


The accompanying notes are an integral part of these financial statements.

3


Liabilities and equity Note 30 June 31 December 30 June 31 December

2012 2011 2012 2011

(Unaudited) (Unaudited)

Current liabilities

Bank overdrafts and short-term loans

from financial institutions 9 1,492,299 837,118 1,492,299 837,118

Trade accounts payable 3,8 2,253,481 1,453,887 2,253,131 1,453,418

Other payables 3 49,568 37,067 51,423 38,257

Current portion of long-term loans 9 120,000 170,000 120,000 170,000

Short-term loan from subsidiary 3 - - 10,000 20,000

Income tax payable 33,065 45,133 33,065 44,996

Accrued expenses 108,376 129,839 104,877 129,839

Other current liabilities 13,364 19,737 12,550 15,257

Total current liabilities 4,070,153 2,692,781 4,077,345 2,708,885

Non-current liabilities

Long-term loans 9 145,300 - 145,300 -

Employee benefit obligations 10 23,143 21,237 21,801 20,013

Other non-current liabilities 16,131 15,101 16,124 15,101

Total non-current liabillties 184,574 36,338 183,225 35,114

Total liabilities 4,254,727 2,729,119 4,260,570 2,743,999

Equity

Share capital:

Authorised share capital 705,000 705,000 705,000 705,000

Issued and paid-up share capital 12 690,823 688,642 690,823 688,642

Treasury shares 11 - (12,179) - (12,179)

Additional paid in capital:

Premium on ordinary sharesPremium on ordinary shares 12 339,254 336,680 339,254 336,680

Surplus on treasury shares 11 52,836 - 52,836 -

Advance received for ordinary share

subscription fee 12 5,728 4,755 5,728 4,755 Retained earnings

Appropriated

Legal reserve 59,557 59,557 59,557 59,557

Treasury shares reserve - 12,179 - 12,179

Unappropriated 559,481 534,220 540,183 516,496Other components of equity 20,549 27,512 20,549 27,512

Total equity 1,728,228 1,651,366 1,708,930 1,633,642

Total liabilities and equity 5,982,955 4,380,485 5,969,500 4,377,641

(in thousand Baht)

Statements of financial position

Separate


As at 30 June 2012 and 31 December 2011

Consolidated



4


For the three-month periods ended 30 June 2012 and 2011 (Unaudited)

Note 2012 2011 2012 2011

Income from operations

Revenue from sale of goods 3 5,468,245 5,292,958 5,463,373 5,292,101

Revenue from rendering of services 4,136 4,104 3,023 2,799

Total income 5,472,381 5,297,062 5,466,396 5,294,900

Cost of operations

Cost of sale of goods 3 (5,200,811) (4,998,625) (5,197,746) (4,998,487)

Cost of rendering of services (4,575) (4,568) (952) (1,164)

Total cost (5,205,386) (5,003,193) (5,198,698) (4,999,651)

Gross profit 266,995 293,869 267,698 295,249

Gain on exchange rate 2,487 - 2,439 -

Other income 3 3,340 4,267 3,777 4,700

Profit before expenses 272,822 298,136 273,914 299,949

Selling expenses (76,883) (77,229) (79,805) (80,629)

Administrative expenses 3 (69,960) (60,126) (69,306) (59,515)

Key management personnel compensation 3 (4,638) (4,404) (4,638) (4,404)

Total expenses (151,481) (141,759) (153,749) (144,548)

Profit before finance cost

and income tax expense 121,341 156,377 120,165 155,401

Finance cost 3 (16,414) (14,163) (16,493) (14,266)

Profit before income tax 104,927 142,214 103,672 141,135

Income tax expense (24,780) (34,576) (24,477) (34,233)

Profit for the period 80,147 107,638 79,195 106,902

Other comprehensive income

Net change in fair value of available-for-sale

investment (6,411) 3,300 (6,411) 3,300

Total other comprehensive income

for the period (6,411) 3,300 (6,411) 3,300

Total comprehensive income for the period 73,736 110,938 72,784 110,202

Earnings per share 14

Basic earnings per share (in Baht) 0.12 0.16 0.11 0.16

Diluted earnings per share (in Baht) 0.11 0.16 0.11 0.16

Statements of comprehensive income

Consolidated Separate

financial statements financial statements

(in thousand Baht)


5


6


For the six-month periods ended 30 June 2012 and 2011 (Unaudited)

Note 2012 2011 2012 2011

Income from operations

Revenue from sale of goods 3 10,589,213 9,843,235 10,584,786 9,841,858

Revenue from rendering of services 8,556 7,504 6,416 5,280

Total income 10,597,769 9,850,739 10,591,202 9,847,138

Cost of operations

Cost of sale of goods 3 (10,069,589) (9,261,599) (10,068,035) (9,261,546)

Cost of rendering of services (8,323) (7,776) (1,650) (1,439)

Total cost (10,077,912) (9,269,375) (10,069,685) (9,262,985)

Gross profit 519,857 581,364 521,517 584,153

Gain on exchange rate 25,256 8,988 25,208 8,988

Other income 3 6,764 6,224 7,647 7,106

Profit before expenses 551,877 596,576 554,372 600,247

Selling expenses (159,419) (149,294) (165,107) (155,716)

Administrative expenses 3 (131,016) (115,931) (129,709) (114,780)

Key management personnel compensation 3 (19,127) (17,658) (19,127) (17,658)

Total expenses (309,562) (282,883) (313,943) (288,154)

Profit before finance cost

and income tax expense 242,315 313,693 240,429 312,093

Finance cost 3 (27,234) (23,995) (27,430) (24,209)

Profit before income tax 215,081 289,698 212,999 287,884

Income tax expense (52,439) (73,562) (51,931) (72,980)


Other comprehensive income

Net change in fair value of available-for-sale

investment (6,963) 6,600 (6,963) 6,600

Total other comprehensive income

for the period (6,963) 6,600 (6,963) 6,600

Total comprehensive income for the period 155,679 222,736 154,105 221,504

Earnings per share 14

Basic earnings per share (in Baht) 0.24 0.32 0.23 0.32

Diluted earnings per share (in Baht) 0.23 0.31 0.23 0.31


(in thousand Baht)

Statements of comprehensive income



7


Statements of changes in equity


Other

components

of equity

Advance Fair value

Issued and received for changes in

paid-up Share Treasury ordinary share Legal Treasury available-for-sale Total

Note share capital premium shares subscription fee reserve shares reserve Unappropriated investment equity

Balance at 1 January 2011 683,745 330,901 (12,179) 5,798 40,832 12,179 311,158 33,529 1,405,963

Contributions by and distributions

to owners of the Company

Shares options exercised 2,659 3,139 - (5,798) - - - - -


subscription fee - - - 4,877 - - - - 4,877

Dividends to owners of the Company 15 - - - - - - - - - - - - (101,310) - - - (101,310)

Total contributions by and distributions

to owners of the Company 2,659 - 3,139 - - - (921) - - - - - (101,310) - - - (96,433)

Comprehensive income for the period

Profit - - - - - - 216,136 - 216,136

Other comprehensive income - - - - - - - 6,600 6,600

Total comprehensive income for the period - - - - - - - - 216,136 - 6,600 - 222,736

Balance at 30 June 2011 686,404 0 334,040 0 (12,179) 0 4,877 0 40,832 0 12,179 0 425,984 0 40,129 0 1,532,266

(in thousand Baht)

Consolidated financial statements

Retained earnings


7




Other

components

of equity

Advance Fair value


paid-up Share Surplus on Treasury ordinary share Legal Treasury available-for-sale Total

Note share capital premium treasury shares shares subscription fee reserve shares reserve Unappropriated investment equity

Balance at 1 January 2012 688,642 336,680 - (12,179) 4,755 59,557 12,179 534,220 27,512 1,651,366



Shares options exercised 12 2,181 2,574 - - (4,755) - - - - -

Treasury shares sold 11 - - 52,836 12,179 - - (12,179) 12,179 - 65,015


subscription fee 12 - - - - 5,728 - - - - 5,728

Dividends to owners of the Company 15 - - - - - - - (149,560) - (149,560)


to owners of the Company 2,181 2,574 52,836 12,179 973 - (12,179) (137,381) - (78,817)


Profit - - - - - - - 162,642 - 162,642

Other comprehensive income - - - - - - - - (6,963) (6,963)

Total comprehensive income for the period - - - - - - - 162,642 (6,963) 155,679

Balance at 30 June 2012 690,823 339,254 52,836 - 5,728 59,557 - 559,481 20,549 1,728,228

Retained earnings

(in thousand Baht)

Consolidated financial statements


8


Other

components

of equity

Advance Fair value


paid-up Share Treasury ordinary share Legal Treasury available-for-sale Total

Note share capital premium shares subscription fee reserve shares reserve Unappropriated investment equity

Balance at 1 January 2011 683,745 330,901 (12,179) 5,798 40,832 12,179 295,996 33,529 1,390,801



Shares options exercised 2,659 3,139 - (5,798) - - - - -


subscription fee - - - 4,877 - - - - 4,877

Dividends to owners of the Company 15 - - - - - - - - - - - - (101,310) - - - (101,310)


to owners of the Company 2,659 - 3,139 - - - (921) - - - - - (101,310) - - - (96,433)


Profit - - - - - - 214,904 - 214,904

Other comprehensive income - - - - - - - 6,600 6,600

Total comprehensive income

for the period - - - - - - - - - - - 214,904 - 6,600 - 221,504

Balance at 30 June 2011 686,404 0 334,040 0 (12,179) 0 4,877 0 40,832 0 12,179 0 409,590 0 40,129 0 1,515,872


Separate financial statements

Retained earnings

(in thousand Baht)



9




Other

components

of equity

Advance Fair value


paid-up Share Surplus on Treasury ordinary share Legal Treasury available-for-sale Total

Note share capital premium treasury shares shares subscription fee reserve shares reserve Unappropriated investment equity

Balance at 1 January 2012 688,642 336,680 - (12,179) 4,755 59,557 12,179 516,496 27,512 1,633,642



Shares options exercised 12 2,181 2,574 - - (4,755) - - - - -

Treasury shares sold 11 - - 52,836 12,179 - - (12,179) 12,179 - 65,015


subscription fee 12 - - - - 5,728 - - - - 5,728

Dividends to owners of the Company 15 - - - - - - - (149,560) - (149,560)


to owners of the Company 2,181 2,574 52,836 12,179 973 - (12,179) (137,381) - (78,817)


Profit - - - - - - - 161,068 - 161,068

Other comprehensive income - - - - - - - - (6,963) (6,963)

Total comprehensive income

for the period - - - - - - - 161,068 (6,963) 154,105

Balance at 30 June 2012 690,823 339,254 52,836 - 5,728 59,557 - 540,183 20,549 1,708,930

Separate financial statements

Retained earnings

(in thousand Baht)


10


Statements of cash flows


2012 2011 2012 2011

Cash flows from operating activities


Adjustments for

Depreciation 21,260 22,419 20,676 22,118

Dividend income (689) (1,500) (689) (1,500)

Finance costs 27,234 23,995 27,430 24,209

Unrealised loss on exchange rate 5,166 7,387 5,166 7,387

Bad and doubtful debts expense 2,776 7,554 2,776 7,554

Loss on obsolete inventories 14,262 732 14,262 732

(Gain) loss on disposal of property,

plant and equipment (298) 237 (298) 237

Employee benefit expense 1,906 1,913 1,788 1,787

Inventory donation expense 7,346 5,224 7,346 5,224

Income tax expense 52,439 73,562 51,931 72,980

294,044 357,659 291,456 355,632

Changes in operating assets and liabilities

Trade accounts receivable (1,032,789) (917,268) (1,032,300) (918,379)

Inventories (520,918) (559,064) (515,807) (558,360)

Rebate receivable (79,893) (91,985) (79,893) (91,985)

Other current assets 5,174 (67,152) 5,703 (67,161)

Other non-current assets 973 (8,707) 988 (8,715)

Trade accounts payable 795,209 764,172 795,328 764,201

Other payables 12,501 11,090 13,166 11,756

Accrued expenses (19,476) 14,652 (22,975) 17,815

Other current liabilities (6,373) (3,698) (2,707) (4,285)

Other non-current liabilities 1,030 (2,008) 1,023 (2,008)

Cash generated used in operating activities (550,518) (502,309) (546,018) (501,489)

Income tax paid (64,547) (53,430) (63,862) (52,904)

Net cash used in operating activities (615,065) (555,739) 0 0 (609,880) 0 (554,393)

Cash flows from investing activities

Dividends received from long-term investment 414 1,500 414 1,500

Purchase of property, plant and equipment (11,778) (8,656) (10,639) (7,758)

Sale of property, plant and equipment 930 10,566 930 10,566

Net cash from (used in) investing activities (10,434) 3,410 (9,295) 4,308


financial statementsfinancial statements

(in thousand Baht)


11


Statements of cash flows


2012 2011 2012 2011

Cash flows from financing activities

Increase in bank overdrafts and

short-term loans from financial institutions 654,400 664,238 654,400 664,238

Interest paid (29,221) (20,572) (29,417) (20,786)

Dividends paid to owners of the Company (149,560) (101,310) (149,560) (101,310)

Proceeds from borrowings from bank 350,000 - 350,000 -

Repayment of borrowings from bank (254,700) (24,601) (254,700) (24,601)

Repayment of borrowings from subsidiary - - (10,000) -

5,728 4,877 5,728 4,877

Proceeds from sale of treasury shares 65,015 - 65,015 -

Net cash from financing activities 641,662 522,632 631,466 522,418

Net increase (decrease) in cash

and cash equivalents 16,163 (29,697) 12,291 (27,667)

Cash and cash equivalents at 1 January 89,477 115,386 86,647 108,220

Cash and cash equivalents at 30 June 105,640 85,689 98,938 80,553

- -

Non-cash transactions

Increase (decrease) in fair value of avilable-for-sale

investment (6,963) 6,600 (6,963) 6,600

Net increase (decrease) in advance received for

ordinary share subscription fee 972 (921) 972 (921)

Share dividends received from long-term investment 275 - 275 -

Total (5,716) 5,679 (5,716) 5,679

Advance received for ordinary share subscription fee

(in thousand Baht)




12

Synnex (Thailand) Public Company Limited and its Subsidiary Notes to the financial statements For the three-month and six-month periods ended 30 June 2012 (Unaudited)

13

Note Contents 1 General information

2 Basis of preparation of the interim financial statements

3 Related parties

4 Trade accounts receivable

5 Inventories

6 Investment in subsidiary

7 Property, plant and equipment

8 Trade accounts payable

9 Loans from financial institutions

10 Employee benefit obligations

11 Treasury shares

12 Warrants

13 Segment information

14 Earnings per share

15 Dividends

16 Commitments with non-related parties


14

These notes form an integral part of the financial statements. The interim financial statements issued for Thai regulatory reporting purposes are prepared in the Thai language. These English language financial statements have been prepared from the Thai language statutory financial statements, and were approved and authorized for issue by the Board of Directors on 13 August 2012.

1 General information Synnex (Thailand) Public Company Limited, the “Company”, is incorporated in Thailand and has its registered office at 433 Sukontasawat Road, Lardprao, Lardprao, Bangkok, Thailand. The Company was listed on the Stock Exchange of Thailand on 30 November 2007. The Company’s major shareholders during the financial year were T.K.S. Technology Public Company Limited (39.04% shareholding) and King’s Eye Investment Ltd. (35.46% shareholding) incorporated in Thailand and British Virgin Islands, respectively. The principal businesses of the Company are importer and distributor of computer equipment. Details of the Company’s subsidiary as at 30 June 2012 and 31 December 2011 were as follows: Country of Ownership interest Name of the entity Type of business incorporation (%) 30

March 31

June December 2012 2011 Direct subsidiary Prism Solutions Co., Ltd. Training service, repair

asn Thailand 99.99 99.99

and maintenance service of computer system, and selling computer accessories

2 Basis of preparation of the interim financial statements (a) Statement of compliance

The interim financial statements are prepared on a condensed basis in accordance with Thai Accounting Standard (TAS) No. 34 (revised 2009) Interim Financial Reporting; guidelines promulgated by the Federation of Accounting Professions (FAP); and applicable rules and regulations of the Thai Securities and Exchange Commission. The interim financial statements are prepared to provide an update on the financial statements for the year ended 31 December 2011. They do not include all of the financial information required for full annual financial statements but focus on new activities, events and circumstances to avoid repetition of information previously reported. Accordingly, these interim financial statements should be read in conjunction with the financial statements of the Company and its subsidiaries for the year ended 31 December 2011. The accounting policies and methods of computation applied in these interim financial statements are consistent with those applied in the financial statements for the year ended 31 December 2011.


15

(b) Presentation currency

The interim financial statements are prepared and presented in Thai Baht. All financial information presented in Thai Baht has been to the nearest thousand unless otherwise stated.

(c) Use of estimates and judgements

The preparation of interim financial statements in conformity with TFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. In preparing these interim financial statements, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the financial statements for the year ended 31 December 2011.

3 Related parties For the purposes of these financial statements, parties are considered to be related to the Group if the Group has the ability, directly or indirectly, to control or joint control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Relationships with related parties were as follows: Name of entities

Country of incorporation/ nationality

Nature of relationships

T.K.S. Technology Public Co., Ltd. Thailand Major shareholders, 39.04% shareholding King’s Eye Investment Ltd. British Virgin

Islands Major shareholders, 35.46% shareholding

Prism Solution Co., Ltd. Thailand Subsidiary, 99.99% shareholding, and some co - directors.

T.K.S Siam Press Management Co., Ltd.

Thailand Mutual shareholding

Synnex Global Ltd. British Virgin Islands

Indirect shareholding via King’s Eye Investment Ltd.

Synnex Technology International Corporation

Taiwan Indirect shareholding via King’s Eye Investment Ltd.

The pricing policies for particular types of transactions are explained further below: Transactions Pricing policies Sale of goods Market price Rendering of service Market price Purchase of goods Market price Receiving of services Market price Technical assistance and other service expense Contractually agreed prices Interest expense 2.5% per annum


16

Significant transactions for the three-month and six-month periods ended 30 June 2012 and 2011 with related parties were as follows: Consolidated Separate financial statements financial statements Three-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Subsidiaries Sale of goods or rendering of service - - 4,366 1,352 Purchases of goods or receiving of service - - 324 308 Technical assistance and other service expense - - 4,684 4,226 Interest expense - - 87 112 Other income - - 450 450 Key management personnel Short-term employee benefit 4,638 4,404 4,638 4,404 Other related parties Sale of goods or rendering of service 1,772 5,443 1,682 4,915 Purchases of goods or receiving of service 54,001 62,631 54,001 62,631 Printing services 3,377 2,985 3,377 2,985 Warehouse management expense 1,191 1,706 1,191 1,706 Technical assistance and other service expense 668 504 668 504 Dividends paid 113,237 77,207 113,237 77,207

Consolidated Separate financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Subsidiaries Sale of goods or rendering of service - - 10,311 2,791 Purchases of goods or receiving of service - - 660 679 Technical assistance and other service expense - - 8,922 7,879 Interest expense - - 212 223 Other income - - 900 900 Key management personnel Short-term employee benefit 19,127 17,658 19,127 17,658 Other related parties Sale of goods or rendering of service 5,186 8,003 5,080 7,451 Purchases of goods or receiving of service 111,165 114,219 111,165 114,219 Printing services 6,782 6,390 6,782 6,390 Warehouse management expense 2,426 2,941 2,426 2,941 Technical assistance and other service expense 1,457 1,293 1,457 1,293 Dividends paid 113,237 77,207 113,237 77,207


17

Balances as at 30 June 2012 and 31 December 2011 with related parties were as follows: Trade accounts receivable Consolidated Separate from related parties financial statements financial statements

30

June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand Baht) Subsidiaries Prism Solution Co., Ltd. - - 919 - Other related parties T.K.S. Technology Public Co., Ltd. 1,162 749 1,162 749 T.K.S. Siam Press Management Co., Ltd. 210 693 192 555 Total 1,372 1,442 2,273 1,304

Trade accounts payable - related parties Other related parties T.K.S. Technology Public Co., Ltd. 37,353 22,758 37,353 22,758 T.K.S. Siam Press Management Co., Ltd. 1,986 1,415 1,986 1,415 Total 39,339 24,173 39,339 24,173 Other payables to related parties Subsidiaries Prism Solution Co., Ltd. - - 1,856 1,190

Other related parties T.K.S. Siam Press Managements Co., Ltd. 997 2,213 997 2,213 Synnex Global Ltd. 1,323 2,674 1,323 2,674 Synnex Technology International Corp. - 260 - 260 Total 2,320 5,147 4,176 6,337

Loans from Interest Consolidated Separate related party rate financial statements financial statements

30 June

31 December

30 June

31 December

2012 2011 2012 2011 2012 2011 Short-term loans (% per annum) (in thousand Baht) Subsidiary Prism Solution Co., Ltd. 2.5 2.5 - - 10,000 20,000 Short-term loans from related party - - 10,000 20,000


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Movements during the six-month periods ended 30 June 2012 and 2011 of loans from related parties were as follows: Consolidated Separate Loans from related party financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Short-term loans Subsidiary At 1 January - - 20,000 18,000 Decrease - - (10,000) - At 30 June - - 10,000 18,000

Significant agreements with related parties Trademark license agreement On December 11, 2007, the Company entered into a new “Trademark Licensing Agreement’ with Synnex Global Ltd. which became effective from the year 2008 onwards. The Company would be able to use the trademark without incurring any expenses when the Synnex group (holding shares via King’s Eye Investment Ltd.) holds at least 20% of the Company’s total paid-up registered share capital and without any written intention for the Company to cease the usage of the trademark from the Synnex group. Software usage and maintenance service agreement On December 11, 2007, the Company entered into a new “Software Usage and Maintenance Service Agreement” with Synnex Global Ltd. under which no compensation is charged from software usage. However, the consulting service is charged monthly at the rate stipulated in the agreement. The Company would be able to use the software and receive maintenance service under the agreement when the Synnex group (holding shares via King’s Eye Investment Ltd.) holds at least 20% of the Company’s total paid-up registered share capital and without any written intention for the Company to cease the usage of the “Global” software system from the Synnex group. Technical assistance agreement

The Company entered into a service agreement with Prism Solution Co., Ltd. to promote sales of products technically (both before and after sales), which the Company is a distributor. The Company has to pay service fee monthly that is calculated at 0.07% of total sales of the Company (2011: 0.08%) and service out of the office which in the years 2012 and 2011 the Company has to pay monthly fee of Baht 0.15 million. The agreement term is for 1 year starting from January 1 to December 31 of each year. Office service agreement

The Company entered into agreement to provide office service including equipment and utilities with Prism Solution Co., Ltd., which in the years 2012 and 2011 the Company has to receive monthly fee of Baht 0.15 million. The agreement term is for 1 year starting from January 1 to December 31 of each year.


19

Memorandum of agreement for warehouse management

The Company entered into a memorandum of agreement for warehouse management and transport and delivery of goods with T.K.S. Siam Press Management Co., Ltd. for the period of 3 years commencing from 1 September 2011 until 31 August 2014. The Company has to pay the service fee monthly, which for the years 2012 and 2011 the service fee is calculated at 2.00% - 3.00% of sales price excluding value added tax, respectively.

4 Trade accounts receivable

Consolidated Separate financial statements financial statements

30

June 31

December 30

June 31

December Note 2012 2011 2012 2011 (in thousand Baht) Related parties 3 1,372 1,442 2,273 1,304 Other parties 3,360,304 2,327,445 3,353,594 2,322,263 Total 3,361,676 2,328,887 3,355,867 2,323,567 Less allowance for doubtful accounts (177,049) (174,273) (177,049) (174,273) Net 3,184,627 2,154,614 3,178,818 2,149,294

2012 2011 2012 2011 (in thousand Baht) Bad and doubtful debts expense for -the three-month period ended 30 June 2,174 1,688 2,174 1,688 -the six-month period ended 30 June 2,816 8,805 2,816 8,805

Aging analyses for trade accounts receivable were as follows: Consolidated Separate financial statements financial statements

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June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand Baht) Related parties Within credit terms 742 852 1,643 714 Overdue:

Less than 3 months 630 590 630 590 1,372 1,442 2,273 1,304 Other parties Within credit terms 2,176,146 1,370,131 2,169,895 1,367,607 Overdue:

Less than 3 months 849,001 763,795 848,543 761,156 3-6 months 160,883 22,473 160,883 22,454 6-12 months 3,692 925 3,692 925 Over 12 months 170,582 170,121 170,581 170,121

3,360,304 2,327,445 3,353,594 2,322,263 Less allowance for doubtful accounts (177,049) (174,273) (177,049) (174,273) 3,183,255 2,153,172 3,176,545 2,147,990

Net 3,184,627 2,154,614 3,178,818 2,149,294 The normal credit term granted by the Group ranges from 30 days to 60 days.


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5 Inventories


30

June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand Baht) Finished goods 1,977,291 1,453,230 1,971,078 1,452,128 Goods in transit 35,568 46,057 35,568 46,057 2,012,859 1,499,287 2,006,646 1,498,185 Less allowance for decline in value (64,900) (50,638) (64,825) (50,563) Net 1,947,959 1,448,649 1,941,821 1,447,622


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6 Investment in subsidiary Investments in subsidiaries as at 30 June 2012 and 31 December 2011 were as follows:

Separate financial statements Name of subsidiary Ownership Interest Paid-up capital Cost method At cost - net

30 June

31 December

30 June

31 December

30 June

31 December

30 June

30 June

2012 2011 2012 2011 2012 2011 2012 2011 (%) (in thousand Baht) Prism Solution Co., Ltd. 99.99 99.99 8,000 8,000 8,000 8,000 8,000 8,000 Total 8,000 8,000 8,000 8,000

No dividends were received from the above investment for the three-month and six-month period ended 30 June 2012 and 2011

Synnex (Thailand) Public Company Limited and its Subsidiary Notes to the financial statements For the three-month period ended 30 June 2012 (Unaudited)

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7 Property, plant and equipment During the six-month period ended 30 June 2012, the Company purchased equipment for Baht 11.78

million as shown in consolidated financial statements and Baht 10.64 million as shown in the separate financial statements. For the period ended 30 June 2011, Baht 8.66 million was shown in consolidated financial statements and Baht 7.76 million in separate financial statements, respectively.

During the six-month period ended 30 June 2012, the company sold equipment for Baht 0.93 million

as shown in consolidated financial statements and separated financial statements. For the period ended 30 June 2011, Baht 10.57 million was shown in consolidated financial statements and separate financial statements.

8 Trade accounts payable


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June 31

December 30

June 31

December Note 2012 2011 2012 2011 (in thousand Baht) Related parties 3 39,339 24,173 39,339 24,173 Other parties 2,214,142 1,429,714 2,213,792 1,429,245 Total 2,253,481 1,453,887 2,253,131 1,453,418

9 Loans from financial institutions


30

June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand Baht) Long-term loans - secured 265,300 - 265,300 - Less Current portion of long-term loans (120,000) 170,000 (120,000) 170,000 Net 145,300 170,000 145,300 170,000

During the six-month period ended 30 June 2012, the Company had additional long-term loan with financial institution at amount of Baht 350 million and repayment at amount of Baht 134.7 million. The Company shall be repay the principle at amount of Baht 10 million of each month with interest. Loans from financial institutions were long-term loan and secured promissory notes were secured by land together with construction and machinery of the Group. In addition, the transfer of beneficial right of insurance claim on securities and parts of goods to the lenders at Baht 720 million of secured amount.


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The Company shall comply with the following: - Maintain the debt to equity ratio to not more than 2.75 to 1 time the loan is completely repaid. - Synnex Technology International Corp. or King’s Eye Investment Ltd. and T.K.S Technology Public Co., Ltd. shall remain as the shareholders, either directly or indirectly, at all time and each company must hold the shares at the not less than 30% of the issued and fully paid-up registered share capital. The short-term loans from financial institutions were trust receipts payable and promissory notes with maturity periods ranging from 1-3 months, carrying interest rate at MMR per annum.

10 Employee benefit obligations

Consolidated Separate financial statements financial statements Three-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Statement of comprehensive income

recognised in profit or loss

Other long-term employee benefits 956 957 894 894 956 957 894 894

Consolidated Separate financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Statement of comprehensive income

recognised in profit or loss

Other long-term employee benefits 1,906 1,913 1,788 1,787 1,906 1,913 1,788 1,787 Movement in the present value of the defined benefit obligations: Consolidated Separate financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht) Defined benefit obligations at 1 January 21,237 17,405 20,013 16,439 Current service costs and interest 1,906 1,913 1,788 1,787 Defined benefit obligations at 30 June 23,143 19,318 21,801 18,226

11 Treasury shares

The treasury shares account within equity comprises the cost of the Company’s own shares held by the Group as follows:

30 June 2012 31 December 2011

Number Baht Number Baht (in thousand shares/thousand Baht)

The Company - - 11,000 12,179


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In November 2008, the Board of Directors of the Company approved a treasury share plan (‘Plan’) to re-purchase not more than 10 percent of the Company’s shares then in issue. The purpose of the Plan is to manage the Company’s excess liquidity. The maximum amount approved for share purchase under the Plan is Baht 71.25 million and the price to be paid for the shares is not to exceed 115 percent of the average closing price on the Stock Exchange of Thailand (SET) over the 5 trading days before each share purchase is made. The Company may purchase the shares through the SET during the period from 25 November 2008 to 24 May 2009. The shares purchased may be resold after 6 months but within 3 years after the month of buy back period. At the Board of Directors’ meeting of the Company held on 20 February 2012, the Board of Directors passed the resolution to approve the resale of treasury shares totalling 11 million shares, representing 1.59% of the Company’s issued and paid-up share capital. During the six-month period ended 30 June 2012, the Company resold treasury shares of 11 million shares in the total amounts of Baht 65.02 million which represent cost of treasury shares of Baht 12.18 million and surplus on treasury shares of Baht 52.84 million.

12 Warrants

The Company has issued 25 million units of warrants to the Company’s directors and employees. The details of the Warrants are as follows:

Type of warrants : Specified-Holder-Name and Non-Transferable Warrants to

buy ordinary shares to be newly issued by the Company. Number of units : 25 million units Maturity : 5 years Offering : Offer to the Company’s directors and employees Offering price : Baht 0 per unit Exercise price : 2.18 Baht per share Exercise date : The first exercise starts on 30 June 2009 up to 28 June 2013.

The warrant holders are entitled to exercise the warrants every last working day of June and December. The remaining or non-exercisable warrants can be accumulated and exercised later throughout the term of warrants. The exercise period of warrants is shown in the following table:

Exercise period Exercisable Amount

(% of warrants allotted to each warrant holder)

No. 1 10.00 No. 2 and No. 3 7.50 No. 4 and No. 5 10.00 No. 6 and No. 7 12.50 No. 8 and No. 9 15.00

Exercise right per unit : 1 unit to 1 ordinary share Number of ordinary shares allotted and reserved for the Warrants

: Ordinary shares to be newly issued by the Company

As at 30 June 2012, there were 11.55 million remaining warrants with full conversion rights to purchase ordinary shares that have not yet been exercised.


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In June 2012, for the warrant exercise no. 7, there were 2.63 million units of warrant exercised to purchase 2.63 million shares at Baht 2.18 per share aggregating to Baht 5.73 million. The Company is in the process of registration with the Ministry of Commerce. Therefore, the statement of position as at 30 June 2012 recorded the transaction separately from the shareholders’ equity under the caption of “Advance received for ordinary share subscription fee”. The Company registered the resulting increase in share capital with the Ministry of Commerce on 10 July 2012, and the Stock Exchange of Thailand approved the additional ordinary shares from the exercised warrants as listed securities, effective from 12 July 2012.

In December 2011, for the warrant exercise no. 6, there were 2.18 million units of warrant exercised to purchase 2.18 million shares at Baht 2.18 per share aggregating to Baht 4.76 million. The Company is in the process of registration with the Ministry of Commerce. Therefore, the statement of position as at 31 December 2011 recorded the transaction separately from the shareholders’ equity under the caption of “Advance received for ordinary share subscription fee”. In January 2012, The Company has completed process of registration. Then, the Company has transferred advance received for ordinary share subscription fee to be “issued and paid-up share capital” at Baht 2.18 million and “premium on ordinary” shares at Baht 2.58 million.


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13 Segment information

Segment information is presented in respect of the Group’s business. The primary format business is based on the Group’s management and internal reporting structure. The Group’s main business operations involve the trading of computer components, providing computer-related service and training, and distribution through Cnex Shop. The operations carried on in the sole geographic area of Thailand.

Business segments

Trading computer Providing computers Trading Six-month period ended components service and training through Cnex Shop Others Total 30 June 2012 2011 2012 2011 2012 2011 2012 2011 2012 2011 (in thousand Baht) Revenue from external customers 10,544,633 9,790,978 8,556 7,504 44,580 52,257 - - 10,597,769 9,850,739

Inter-segment revenue 10,346 2,815 9,547 8,534 - - - - 19,893 11,349

Reportable segment gross profit (loss) 516,500 580,754 233 (272) 3,124 882 - - 519,857 581,364

Gain on exchange rate and other income 32,020 15,212 Selling and administrative expenses (290,435) (265,225) Key management personnel compensation (19,127) (17,658) Finance cost (27,234) (23,995) Reportable segment profit before

income tax

215,081 289,698 Reportable segment assets 5,448,444 4,946,927 2,177 1,613 5,595 1,761 526,739 415,411 5,982,955 5,365,712

There have been no changes to the basis of segmentation or the measurement basis for the segment profit or loss since 31 December 2011.


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14 Earnings per share

Basic earnings per share

The calculations of basic earnings per share for the three-month and six-month periods ended 30 June 2012 and 2011 were based on the profit for the periods attributable to ordinary shareholders of the Company and the weighted average number of ordinary shares outstanding during the periods as follows: Consolidated Separate financial statements financial statements Three-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht / thousand shares) Profit attributable to ordinary shareholders of the Company (basic) 80,147 107,638 79,195 106,902 Number of ordinary shares outstanding at 1 January 688,642 683,745 688,642 683,745 Effect of own shares held (242) (11,000) (242) (11,000) Effect of conversion of warrants 2,181 2,659 2,181 2,659 Weighted average number of ordinary shares outstanding (basic) 690,581 675,404 690,581 675,404 Earnings per share (basic) (in Baht) 0.12 0.16 0.11 0.16

Consolidated Separate financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht / thousand shares) Profit attributable to ordinary shareholders of the Company (basic) 162,642 216,136 161,068 214,905 Number of ordinary shares outstanding at 1 January 688,642 683,745 688,642 683,745 Effect of own shares held (5,192) (11,000) (5,192) (11,000) Effect of conversion of warrants 1,990 2,483 1,990 2,483 Weighted average number of ordinary shares outstanding (basic) 685,440 675,228 685,440 675,228 Earnings per share (basic) (in Baht) 0.24 0.32 0.23 0.32 Diluted earnings per share The calculations of diluted earnings per share the three-month and six-month periods ended 30 June 2012 and 2011were based on the profit for the periods attributable to ordinary shareholders of the Company and the weighted average number of ordinary shares outstanding during the periods after adjusting for the effects of all dilutive potential ordinary shares as follows:


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Consolidated Separate financial statements financial statements Three-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht / thousand shares) Profit attributable to ordinary shareholders of the Company (basic) 80,147 107,638 79,195 106,902 Weighted average number of ordinary share outstanding (basic) 690,581 675,404 690,581 675,404 Effect of conversion of warrants 8,496 11,225 8,496 11,225 Weighted average number of ordinary shares outstanding (diluted) 699,077 686,629 699,077 686,629 Earnings per share (diluted) (in Baht) 0.11 0.16 0.11 0.16

Consolidated Separate financial statements financial statements Six-month period ended 30 June 2012 2011 2012 2011 (in thousand Baht / thousand shares) Profit attributable to ordinary shareholders of the Company (basic) 162,642 216,136 161,068 214,905 Weighted average number of ordinary share outstanding (basic) 685,440 675,228 685,440 675,228 Effect of conversion of warrants 8,496 11,225 8,496 11,225 Weighted average number of ordinary shares outstanding (diluted) 693,936 686,453 693,936 686,453 Earnings per share (diluted) (in Baht) 0.23 0.31 0.23 0.31

15 Dividends

At the annual general meeting of the shareholders of the Company held on 20 April 2012, the shareholders approved the appropriation of dividend of Baht 0.22 per share, amounting to Baht 149.56 million. The dividend was paid to shareholders on 14 May 2012.

At the annual general meeting of the shareholders of the Company held on 25 April 2011, the shareholders approved the appropriation of dividend of Baht 0.15 per share, amounting to Baht 101.31 million. The dividend was paid to shareholders on 20 May 2011.


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16 Commitments with non-related parties Consolidated Separate financial statements financial statements

30

June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand Baht) Capital commitments Contracted but not provided for: Buildings and other constructions - 77 - 77 Furniture, fixtures and office equipment 1,371 1,371 1,371 1,371 Total 1,371 1,448 1,371 1,448 Non-cancellable operating lease commitments Within one year 11,957 12,518 11,957 12,518 After one year but within five years 12,080 12,978 12,080 12,978 Total 24,037 25,496 24,037 25,496

Consolidated / Separate financial statements

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June 31

December 30

June 31

December 2012 2011 2012 2011 (in thousand U.S. Dollar) (in thousand Baht) Other commitments Unused overdrafts - - 100,000 90,000 Unused promissory note - - 1,595,000 1,930,000 Unused letter of credit and trust receipt - - 1,330,211 1,044,919 Forward contract 31,064 26,436 - - Bank guarantees - - 67,755 65,155 Total 31,064 26,436 3,092,966 3,130,074

Documents

Synnex (Thailand) Public Company Limited and its Subsidiary