TRUE : Annual Report 2007

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At a GlanceFinancial HighlightsMessage from the ChairmanMessage from the President and CEOSegment SolutionsSocial ResponsibilityCompany Background and Major Development and AwardsIndependent DirectorsCorporate Governance Compliance ReportRevenues BreakdownCorporate InformationInvestment Structure of True Group ReferencesRisk FactorsShareholdersDividend PolicyManagementConnected TransactionsAudit FeesReport of the Audit Committee for the Year 2007Report of the Compensation and Nominating Committee for the Year 2007Report of the Corporate Governance Committee for the Year 2007Report of the Finance Committee for the Year 2007Report of the Board of Directors Responsibilities forFinancial Statements for the Year 2007Managements Discussion and AnalysisFinancial Statements

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36 ANNUAL REPORT 2007

AboutActivities

Social Responsibility

For 17 years, True Corporation Plc has consistently promoted social development through various activities, especially projects related to education and the environment affecting children and young people.

In 2007 True launched its Plook Panya (Planting Wisdom) project, extending its Corporate Social Responsibility (CSR) activities. True is committed to effectively spreading knowledge and education to the nation as well as enabling Thais to access new knowledge that will inspire lifetime learning, leading to self-development and self-reliance, and ultimately to national development.

Trues President and CEO, Mr. Suphachai Chearavanont, expresses it this way: Trues mission and societal responsibility is to use its lifestyle convergence strategy and telecommunications technology to help Thailand become a knowledge-based society.

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BETTER TOGETHER 37

Plook Panya will allow children and young people to access information and knowledge more widely and more quickly via television, an easily accessible media providing images and sound, as well as bringing together all education platforms to support teaching in schools

To celebrate the Auspicious Occasion of His Majesty the King's 80th Birthday Anniversary on December 5,2007, True launched a major initiative under Plook Panya, Opening the educational world view to 800 schools. This involved presenting TrueVisions satellite dishes and other equipment, along with carefully chosen educational content on TrueVisions channels, to rural schools nationwide. This will help Thai students broaden their world view by accessing information, knowledge and entertainment to the same degree as their global counterparts.

True has committed to expanding this project and completing its installation in 10,000 rural schools nationwide. The project is not just about installing TrueVisions but also about providing schools with a wide range of teaching materials.

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This reflects Trues belief that knowledge-based societies consist of two elements: 1) A basic infrastructure or foundation requiring a combination of wireline and wireless technology; and 2) High-quality content that will inspire us all. If children are inspired and given the opportunity to learn using high-quality content, the final outcome will be a genuine knowledge-based society.

As well as activities that help create a knowledge-based society, True each year will promote a new theme for learning activities based on current global issues. In 2007, Plook Panyas focus was educating people on the Global Warming Crisis uppermost on national and global agendas, striving to encourage mutual collaboration to reduce global warming using two activities: A True Youth Camp for high school students called Preventing Global Warming The True Young Producer Award, requiring university students to make a television commercial with the theme Helping Reduce Global Warming.

The Youth Camp brought together leaders from senior high schools to be trained and educated on global warming. They then returned to their schools and initiated projects on reducing global warming, passing on their knowledge and awareness so that everyone becomes aware of the problem and tries to find ways to counter it.

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The True Young Producer Award 2007 aims to identify advertising novices interested in advertising motion picture production. University students nationwide can participate in the contest, which focuses on the global warming issue. The winning film will air on TrueVisions. The aim is to encourage Thais to be aware of and understand the crisis which has direct negative impacts on society, present and future, and to try to work together to resolve the issue.

In addition, other projects, activities and initiatives under Plook Panya benefit all of Trues stakeholders, including customers, employees and public. These include: Nature Conservation Photography Contest Precious Wildlife and Valued Forest True Young Scientist Award Scholarships for Employees Children Student Internship Program

True takes its responsibility for helping Thailand develop into a genuine knowledge-based society very seriously. Plook Panya is a key part of this commitment, promoting knowledge and education as well as providing children, young people and all Thai people with access to new knowledge that will inspire a lifetime of learning. This, in turn, will lead to self-development and self-reliance, and ultimately to national development.

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InsightTrue Success


We were incorporated in November 1990, and registered as a public limited company in 1993 under our former name, TelecomAsia Corporation Public Company Limited. We began trading on the Stock Exchange of Thailand in December 1993 with the security symbol TA.

In April 2004, we rebranded under the True name and adopted the security symbol TRUE with registered and paid-up capital of Baht 45.032 billion at the end of 2007. True is now one of the strongest brands in Thailand.

Trues vision is to be the leader in convergence lifestyle. Trues mission is to bring knowledge, information,entertainment, and the ability to access each othersvalues, to every household and the youth of Thailand as well as to create value for our organization, employees and shareholders. Our convergence lifestyle strategy differentiates True from other operators by providinga full range of communications solutions drawing on rich content to meet every customers lifestyle needs.

Company Backgroundand Major Developments and Awards

True Corporation Public Company Limited is the most integrated communications solutions provider in Thailand.

Backed by Asias largest agro-conglomerate, the Charoen Pokphand Group (CP), with a shareholding of 30.02 percent as of December 2007, we have expanded our business from being a fixed-line provider to a total communications solutions provider, offering consumers, small and medium enterprises, and corporations a full range of voice, video and data services in solutions customized to meet their needs. We are Thailands largest provider of Internet, broadband Internet and pay-TV services, as well as the largest fixed-line service provider in the BMA, a leading online game providerand the number three mobile phone operator in Thailand.

We operate five core businesses: Mobile phone business under TrueMove (formerly TA Orange); Online business under TrueOnline, which consists of fixed-line phone service and its value-added services, business data services, Internet and broadband Internet services and WE PCT (Personal Communication Telephone); Pay-TV business under TrueVisions (formerly UBC) Digital commerce business under TrueMoney; Digital content business under TrueLife (as well as lifestyle venture True Coffee).

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We provide fixed-line phone services under a build-transfer-operate (BTO) concession with TOT Corporation Public Company Limited (TOT) to build, install, jointly operate and maintain a 2.6 million-line wireline network in the BMA for a period of 25 years, ending on October 2017. We received our first revenue from the operation of our wireline network in November 1992.

We received additional approvals to provide value-added, public phone and other services, and launched our WE PCT service in 1999, hi-speed data transmission services including ADSL and cable modem in 2001, and Wi-Fi services in 2003. After we were granted the licenses from the NTC, in 2007 we launched international Internet gateway service and soft-launched international direct dialing service.

In October 2001, we acquired a 41.1 percent equity interest in Bangkok Inter Teletech Public Company

Limited (BITCO) (the parent company of TA Orange) expanding our business in the mobile sector. Full commercial launch of TA Oranges mobile tele-communications service in Thailand took place in March 2002. TA Orange was rebranded TrueMove at the beginning of 2006.

We gradually increased our shareholding in BITCO until at the end of 2006 we owned 93.4 percent. In December 2007 a rights offering of BITCO shares to CP left Trues shareholding in BITCO at 75.3 percent, with CP owning 23.9 percent. Trues shareholding will increase to 98.6 percent if True purchases these sharesfrom CP via options given by CP for an 18-month periodfrom the rights offering, pending Trues shareholders approval.

TrueMove operates a digital mobile tele-communications network based on the GSM (Global System for Mobile telecommunications) standard in the 1800 MHz frequency under a BTO concession with CAT Telecom, which is due to end in September 2013.

In January 2006, True purchased UBC shares from MIH and completed the tender offer for UBC shares held by the public in March 2006, allowing True to own 91.8 percent (effective holding) of UBC. True started to fully consolidate UBCs results into True Group from the first quarter of 2006. UBC was renamed TrueVisions at the beginning of 2007.

TrueVisions operates pay-TV services under a 25-year concession contract with the Mass Commu-nications Organization of Thailand which is due to end on September 30, 2014 for services via satellite and on December 31, 2019 for services via cable.

From 2005 to 2007 True Group received licenses from the NTC to provide Internet service, Internet service via telephone or VoIP (Voice over Internet Protocol), public phone services, fixed-line phone services, international direct dialing and, international Internet gateway services. We were also granted one-year trial licenses for International Private Leased Circuit (IPLC) and International Internet Protocol Virtual Private Network (IP VPN) as well as a six-month trial for WiMax.

At the end of 2007, True Group had an annual turnover of Baht 61.6 billion (including interconnection charges), infrastructure investments of Baht 124.7 billion, and employed 10,224 permanent staff.

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Major Developments in 2007

True launched the Plook Panya (Planting Wisdom) project, which will ultimately involve providing educational programs on TrueVisions to 800 schools nationwide. The project is part of Trues efforts to help develop a knowledge society in Thailand.

True placed Baht 4 billion of secured debentures with Thai institutional investors and the public. Proceeds were used to prepay existing debt ahead of maturity date.

In July, TrueMove placed USD 225 million of seven-year bonds with international investors. Proceeds were used to repay debt with Thai financial institutions and to extend overall debt maturity profile.

In October, Trues Chief Financial Officer, Mr. William Harris, announced his resignation. He was replaced, effective January 1, 2008, by former Deputy CFO, Mr. Noppadol Dej-Udom.

In December, CP provided an extra Baht 3 billion to fund TrueMoves ongoing growth by way of a rights offering of six billion shares. True Corp retained the right to buy back the shares within 18 months after the rights offering.

TrueMove

TrueMove entered into Interconnection (IC) regime and started to charge IC with DTAC and AIS early in the year.

Several non-traditional distribution channels were introduced including:

- Thailands first public phone top-up service, offering subscribers the convenience of micro top-ups at 18,000 phone booths in the BMA.

- One hundred Move Up Vans as nationwide mobile sales points offering all True products and services.

- The facility for post-paid subscribers to pay their monthly bills free-of-charge and without needing to show their statements at more than 3,800 7-Eleven stores nationwide.

A Wi-Fi roaming deal was signed with international broadband connectivity provider iPass.

The TrueMove, Lets Try It nationwide advertising campaign was launched, fronted by popular Thai comedian Mr Pettai Wongkhamlao (Hmom Jokemok). The campaign highlights TrueMoves competitive edge in network quality, value-for- money, access to TrueVisions programming, bill payments and EPL mobile access.

The passing of the 12 million subscriber mark was celebrated during Q4.

TrueOnline

SUPER hi-speed Internet was introduced in February 2007, offering a market-leading speed of 1 Mbps. By the end of the year the promotion had attracted more than 254,000 subscribers.

Our second Internet Data Center, at Muang Thong Thani, was opened, offering integrated network and data services.

Trues MPLS Data Networking Solution, IP Telephony (IP PBX) and Managed Security services become the first Thai recipients of the Cisco Powered designation, acknowledging the international quality of our networks.

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We launched in February 2007 an international Internet gateway service. By the end of 2007 True Internet Gateway had achieved a 20 percent domestic market share of the rapidly growing international ISP market.

We soft launched in December 2007 our international direct dialing (IDD) service, which uses the 006 prefix.

TrueVisions

The name was changed from UBC-True in January 2007, emphasizing TrueVisions important role within the Groups overall convergence strategy.

Subscribers were offered more content choices, with greater flexibility, through:

- The acquiring of exclusive Thai-market rights to three seasons of live television broadcasts of English Premier League (EPL) football. EPL-related content is also provided through multimedia platforms including IPTV, TrueMove and Broadband.

- The unveiling of TrueSport a package of leading sports channels, including new channels to accommodate extra EPL games.

- The introduction of international channel packages, offering A-La-Carte choices from HBO, Discovery and Disney.

We continued to progress our mass market campaign, Free View, launched in July 2006. The initiative, which provides cheap access to all free-to-air channels and eight TrueVisions channels, has proven to be an inexpensive and effective way of broadening the pay-TV market.

The fourth season of reality show Academy Fantasia (AF4) proved highly successful, providing various viewing channels and special privileges such as free SMS for TrueMove subscribers, which aided in mobile customer retention. Voting was 50 percent higher than in 2006.

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TrueMoney

TrueMoney Express was launched, offering free, no-statement-required bill payment services through franchises and True partners nationwide.

We announced the development of the worlds first intelligent contactless mobile payment system. Developed with Chinas Watchdata Technologies Co., Ltd., the system uses a TrueMoney RFID (radio-frequency identification) SIM and will be implemented in 2008.

TrueLife

TrueMusic was officially launched, offering music and music-related products and services (many of them on an exclusive basis) across True Groups multimedia platforms. Specific initiatives included collaboration with GMM Grammy Music, proving True customers access to multimedia content via www.truemusic.com and wap.trueworld.net, and exclusive access to new music.

Website portal, truelife.com, passed 1.3 million combined registered subscribers, more than a million higher than a year ago. They represent the early stages of online community development.

Online shopping service, www.weloveshopping.com, was launched, featuring more than 600,000 products and services. The site is one of Thailands most popular online shopping destination.

Special Force, Thailands number one casual online game, passed nine million registered subscribers. The game is a leading example of the rich content TrueLife offers across various Group platforms in this case True Broadband.

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Awards received in 2007

Trues The Miracle TV commercial won a Mental Health Media Award from the Department of Mental Health, Ministry of Public Health.

Trues I Will Do TV commercial won Best Award (Honor The King category) in the Adman Awards & Symposium, organized by the Advertising Association of Thailand. The Miracle won the Silver Award (telecommunication, business equipment & services category) in the same contest.

TrueTouch Co., Ltd. (Nok Air project) was named Best Outsource Call Center by the Call Centre Industry Association of Thailand.

onTM TrueLife won First Prize in the Thailand ICT Awards media and entertainment category, organized by the ICT Ministry, the Software Industry Promotion Agency and the Association of Thai ICT Industry.

onTM TrueLife won a Merit Award media and entertainment category, in the Asia Pacific ICT Alliance Awards.

Trues online Shark Hunter Game won a Silver Award in the interactive/website category in the Thai Direct Marketing Association Awards organized by the Thai Direct Marketing Association.

True Digital Entertainments Cool Game program, broadcast on TrueVisions GSquare channel, received the Royal Thepthong Award (radio and television category) as the outstanding program for youth, from the Broadcasters Association of Thailand under the Royal Patronage of HM the King.

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ANNUAL REPORT 200750

Corporate Governance

In 2007 the Company carries out its business according to the Principles of Good Corporate Governance for Listed Companies 2006 issued by the Stock Exchange of Thailand (SET). The first Good Corporate Governance guideline was issued on March 2002, then fine tuned and modified by the SET in order to be in line with the Organization for Economic Co-operation and Development (OECD) and World Bank suggestions from its corporate governance project called Reports on the Observance of Standards and Codes (CG-ROSC). Trues good corporate governance practices are summarized as follows: Corporate Governance Practice True has two levels of corporate governance oversight; by the Board of Directors and by management. The Board of Directors has established the Corporate Governance Committee which comprises Mr. Narong Srisa-an, Mr. Vitthya Vejjajiva, Dr. Kosol Petchsuwan, Mr. Joti Bhokavanij, Mr. Jens B. Bessai and Dr. Ajva Taulananda. Corporate governance at management level is overseen by the CEO and other senior executives.

Section 1 Rights of Shareholders

1. The Board of Directors has established a corporate governance policy that takes into account as much as possible the rights of shareholders, without being limited to the rights specified only by law. The Board of Directors has approved and implemented the new Corporate Governance policy which has been amended to be in line with the Principles of Good Corporate Governance for Listed Companies 2006 issued by the Stock Exchange of Thailand and combined with the concept of Sufficiency Economy. 2. In the year 2007, the Company held two shareholder meetings, the Annual General Meeting of the Shareholders (the AGM) for the year 2007 on April 24, 2007 and the Extraordinary General Meeting of the Shareholders No. 1/2550 on July 16, 2007. For the convenience of shareholders, the meetings were scheduled on a working day during working hours at 2 pm and held in Bangkok where transportation is convenient. 3. The Company will send shareholders an invitation letter to inform them of dates, times, locations, meeting agendas and the background to issues which shareholders are being asked to vote on, and rules and regulations for the meeting and its voting processes. This information is provided to shareholders in the notice of meeting in accordance with the legally required advance period. Information is explained in detail so a reader who has no background knowledge of the topic will still be able to easily understand it. All information regarding shareholder meetings has been posted on the Companys website around 3-4 weeks in advance before notice of the meetings is sent out, so that shareholders can study all information prior to receiving the notice. 4. The Companys policy prohibits any action that could be considered to violate a shareholders right to access information on the shareholder meeting. Shareholders can make advance inquiries about information

Report

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BETTER TOGETHER 51

they do not understand or submit advance questions to the Companys Investor Relations Department on 0-2699-2515 or to the Company Secretary Department on 0-2643-0076. 5. To encourage attendance at shareholder meetings, the Company provides free-of-charge refreshments and snacks for shareholders before and after meetings as well as souvenirs. The Company encourages shareholders participation and voting in meetings at no charge. Any action that could be considered to violate their right to attend meetings is prohibited. The Company has streamlined its procedures for attending and voting at meetings. The chairman of the meeting ensures there is appropriate time set aside for discussion and encourages shareholders to express their opinions and ask questions related to the Companys operations. Moreover, after the meeting directors meet with shareholders in person and provide them with an opportunity to ask any questions they may not want to ask during the meeting.

Section 2 Equitable Treatment of Shareholders

1. The Company allows shareholders who cannot attend meetings to cast a proxy vote. Shareholders must submit a proxy form to the Company Secretary Department before the meeting so it can be verified. 2. The Company encourages the use of proxy forms on which shareholders can specify their voting preferences. The proxy forms are attached together with the invitation letter to the shareholder meeting. The Company provides options for shareholders to appoint the Chairman of the Audit Committee, who is an independent director, or an independent director as their proxy (with their background information provided). 3. The Company allows minority shareholders to propose any issues to be added to the meeting agenda as well as submitting nominations for directors before the 2007 AGM by using the form provided by the Company and sending it by registered mail to the Company from December 1, 2006 to January 31, 2007. The Company posted the above proposals on its website and through the SETs electronic media. Nevertheless, shareholders did not propose any issues or nomination for directors. 4. For the sake of transparency and historical record, the Company encourages the use of voting cards. The Company also arranges for an independent law office to verify the vote counting. The voting cards will be kept as evidence if there is any argument after the meeting. 5. The Company allows shareholders to vote on individual nominees. 6. The Companys code of conduct covers inside information and insider trading, as well as the use of applicable laws to monitor and prevent the personal use of confidential Company information by management and related persons. Material information which has not yet been disclosed is kept confidential, apart from disclosure to the relevant senior management of the Company. Directors and senior management must report purchases, sales, transfers and assignations of securities issued by the Company to the Securities and Exchange Commission (SEC) within three days of the transactions execution, and provide a copy of this report to the Company for its records and incorporation in its regular report to the Board of Directors. In the year 2007, there were no Board members or executives violating this practice. 7. In the year 2007, there were no Board members or executives violating the rule on conflict of interest in proposed Company transactions.

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8. The Company has measures and procedures for approving the entering into connected transactions in compliance with the Rules and Regulations of the Office of Securities and Exchange Commission (SEC) and the Stock Exchange of Thailand (SET) i.e. related party transactions must obtain approval from the Independent Directors to be processed according to the internal procedure relating to related party transactions, details of which have been stipulated by the Independent Directors. If any related party transaction is deemed to be a connected transaction, the said transaction must be approved by the Audit Committee, the Board of Directors and/or Shareholders Meeting as the case may be according to the Regulations of the Stock Exchange of Thailand. In the year 2007, the Company strictly followed the above rules and regulation. All connected transactions that occurred in the year 2007 have been disclosed in its annual report and annual registration statement (Form 56-1) under the Topic Connected Transaction. The Company has also established an Independent Committee to take part in monitoring highly significant connected transactions. This committee comprises independent directors, creditor-nominated directors and directors representing major shareholders. If any major shareholder has a conflict of interest, directors nominated by this shareholder will abstain from the Independent Committee meeting to consider the case.

Section 3 Role of Stakeholders

1. The Board of Directors recognizes the importance of acknowledging the rights of all stakeholders and their ability to positively influence the Companys conduct and activities, and vice versa. Accordingly, the Company has established a Code of Conduct covering employees and stakeholders which includes: Employees - The right to privacy and the right to be protected from any violation of that privacy - The right to receive fair and equal treatment - The right to fair and equal employment rights such as the right to take leave and to receive fringe benefits, and the opportunity to be promoted, to transfer to other work units, and to receive performance assessments Customers - The right to receive fair and equal treatment - The right to receive full and efficient service from the Companys employees - The right to receive quality goods and highly efficient service - The right to protection of confidential information Suppliers and dealers (business partners) - The right to fair and equal treatment - The right to protection of confidential information - The right to be treated honestly and reliably - The right to information on relevant laws, regulations and policies - The right to fair competition Creditors - The right to be treated honestly in accordance with terms and conditions of all agreements under relevant law and regulations - The right to receive correct and complete financial information - The right to receive payments owing, as well as safeguarding all guaranteed assets given as security Investors - The right to receive fair and equal treatment


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- The right to be treated with the best intentions of the management to operate the business with their best knowledge, skills, and honesty - The right to be protected from the use of insider information for pursuing private interests Government agency - The right to regulate, monitor and punish according to laws and regulation and the government agencys standard practice. 2. The Companys Internal Audit Department reports directly to, and is accountable to, the Audit Committee. The Company provides opportunities for its employees to address their concerns directly to this department or the Audit Committee. 3. The Company operates its business while taking into consideration environmental and social matters and is focused on promoting a knowledge-based society as a path to sustainable development for Thailand. The Company uses modern telecommunications technology to develop educational projects which help with the development of youth and underprivileged children in Thai society. A knowledge-based society offering a better quality of life is an important foundation for ensuring Thailands future prosperity. Social Responsibility Activities 2007 - Helping the young: True presented gifts and sports equipment to children at Sanprasert

community on Childrens Day. - Rural education: True donated toothpaste and toothbrushes, luncheon funds and books and

stationery worth more than Baht 79,000 to students at Ban Sam Jampa in Khon Khaen province. Also, True provided lunch, education material and sports equipment to students at Prathomvittayakarn in Ayutthaya province.

- Helping the elderly: True presented money and necessities to Banglamung Social Welfare Development Center for Older Persons, Chonburi province.

- Telecommunications education: True opens the telecommunications world to young students, hosting a visit to True Tower by 40 youngsters from Kasempittaya kindergarten.

- 12V: 12 Good Deeds for the King: True encouraged its employees and the public to sign up as eye donors with the Thai Red Cross under Trues 12V: 12 Good Deeds for the King project. True employees and Academy Fantasia fan club members were also urged to help mangrove reforesting in Samutsakorn province under the same project.

- Mental Health: Trues The Miracle TV commercial led into the production of TV programs on Channel 9 to help people in society. The TV commercial proved very popular, and won a Mental Health Media Award from the Department of Mental Health, Ministry of Public Health.

- Bike for Peace: True supported the Bike for Peace, promoting environmental preservation and human rights, led by Dr. Kristian Bo (True employee number 001) and the Norwegian biking team. True Tower was the starting point.

- Renovation of Pramaiyikavas Temple: True renovated and painted Pramaiyikavas Temples fence, creating a beautiful view from the Chao Praya River.

- 13th Nature Conservation Contest Precious Wildlife and Valued Forest: True joined with the National Park and Wildlife and Plant Conservation Department, and the Ministry of Natural Resources and Environment, to raise youth awareness of natural and environmental preservation. The photo Leopard won the first prize.

- Animal rights: True sent representatives to join the competition on Saint Game program broadcasts on TrueVisions GSquare channel and won the prize plus cat and dog food. The team donated



the prize to the Home for Handicapped Animals Foundation (under the auspices of Luang Ta Maha Bua).

- National Science project: True opened the National Science project competition (primary school level) 2007, joining with the Thai Association of Science & Technology Education.

- Support for Thai soldiers: Trues Special Force online game launched the SF cares for Thai Soldier campaign inviting the public to send postcards to Thai soldiers based in the three southern provinces. True donated money according to the postcard costs to support the Supreme Command Headquarters.

- Rural education: Trues representatives visited the Rural Lives Development Foundation in Petchaburi province to be briefed on the progress of students who received scholarships from the foundation, and to find out how to help them further.

- Plook Panya project: True launched the Plook Panya project, which will ultimately involve making easily-accessible sound and vision-based educational programs on TrueVisions available to more than 800 schools nationwide. True will pay for the installation of the satellite dish and other equipment

- His Majestys Birthday: In December, His Majesty celebrated his 80th birthday. Trues directors, management and staff shared in the nations pleasure, and took the very visible step of decorating the outside of our head office, True Tower, to mark the occasion as well as wearing pink wrist bands and giving the wrist bands to customers to celebrate and pay gratitude to His Majesty the King.

- Let Them See Love: To emphasize the true meaning of love during the month of Valentine, True invited the public to donate their eyes and organs to the Thai Red Cross Eye Bank and the Thai Red Cross Organ Donation Center. This was under the auspices of doing good deeds for His Majesty the King on the 60th Anniversary Celebrations of His Majesty Accession to the Throne and His Majesty The Kings 80th Birthday Anniversary.

- TrueVisions rural education: TrueVisions established the Learning Room with TrueVisions under the TrueVisions makes students dreams come true project. This provided education materials and equipment, computer rooms with Internet access, stationery and sports equipments to students in rural areas.

- Science camp: True and the National Science Museum held a science camp for students in the three southern provinces to give them the chance to broaden their science knowledge.

- Robot building: True joined Technology Street 2007 to help create a Thai robot-building team. - Beautiful Internal Phone Cable project: True went onsite under the Beautiful Internal Phone

Cable project to check and fix internal phone cable for fixed-line customers in the BMA, as well as checking ADSL cabling and performance free of charge.

- University entrance examination tutoring: True supported the Tutor for Entrance project, helping more than 55,000 students prepare for university entrance examinations. Four major tutor locations at Thai Chamber of Commerce University, Chiang Mai University, Khon Kaen University and Walailak University, as well as other small locations in 100 schools nationwide, used live broadcast technology from True for six days.

- Pirab Noi journalism project: True held the 10th Young Journalism (Pirab Noi) Project, a joint effort between True and the Thai Journalism Association (TJA), as well as holding the 5th Saifa Noi project with the Thai Broadcast Journalists Association, supporting students studying mass communications.

- To help alleviate labor shortage in the telecommunications industry: True has since 1993 joined with the Department of Vocational Education to provide training programs and facilities. To date, 179 students have participated in this training program and 212 teachers have undergone training on various telecommunications topics. In addition, a training center has been opened at Donmuang Technical College to accommodate students, teachers as well as Trues staff.


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The Company is also considering establishing an environmental and social policy and will submit it to the Board of Directors in 2008.

Section 4

Disclosure and Transparency 1. The Company discloses financial and non-financial information (as required by SET regulations) accurately, thoroughly, and in a timely and transparent manner through various channels including the SET and the Companys website, in Thai and English. All disclosed information is updated from time to time. The Company also posts on its website detailed information for analysts and investors such as a graphical summary of financial results showing core business performance, comparative balance sheets, investor news, etc. 2. The Company provides a summary of the Corporate Governance Policy approved by its Board and corporate governance practice through various channels such as the annual report and website. 3. The Company provides a statement of the Boards responsibilities concerning the Companys financial report. This statement is presented alongside the auditors report in the Companys annual report. 4. The Company discloses the roles and responsibilities of the Board of Directors and its committees, the total number of meetings and the number of meetings each member attends, as well as the results of tasks performed during the year in the annual report and in shareholder meeting notices, according to SET and the SEC regulations. 5. The Company paid Directors remuneration in the year 2007 according to rates approved by shareholders at the 2007 AGM, which are the same rates approved by the 2006 AGM and which have not changed since 2002. Remuneration of Directors is paid on a monthly basis 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 Any Director being an employee of the Company shall receive the Directors remuneration in addition to his or her salary as an employee. Independent Directors who hold a position on a Committee shall receive remuneration as follows: Independent Directors who is also the Chairman of a Committee Baht 300,000 per month Independent Directors who is also member of a Committee Baht 200,000 per month Remuneration of Independent Directors who are not members of a Committee, and directors who are not Independent Directors shall remain the same 6. In the year 2007, the Company paid senior executives remuneration according to their contributions and responsibilities, commensurate with that paid by other companies in the same industry. 7. The Company discloses details of remuneration of Directors and senior executives, including the nature and amount of payment, in its annual report and Form 56-1. 8. The Company has an Investor Relations Department to communicate with the public fairly and equitably. Investors can contact Investor Relat ions by phone at 0-2699-2515 or by e-mai l at [email protected]. In the year 2007, Investor Relations held analyst and investor meetings after the



Companys quarterly announcements and also held analyst conference calls after the Company announced major issues and allowed investors and analysts to ask questions of the Companys executives. The Company also held retail investor meetings by participating in a project to provide knowledge for investors organized by the Stock Exchange of Thailand and the Thai Investors Association.

Section 5 Responsibilities of the Board

1. Board Structure 1.1 The Board of Directors consists of four executive directors and 14 non-executive directors.

Independent directors make up 22 percent of the total number. The Company has disclosed each directors background in its annual report and Form 56-1 and on its website at www.truecorp.co.th

1.2 The term of service for each director is clearly stated in the Companys corporate governance policy and Articles of Association which are in accordance with legal requirements.

1.3 The Company has specified the details of independent directors qualifications in its annual report and Form 56-1. Mr. Joti Bhokavanij who serves as the Independent Director and Audit Committee member has an accounting and finance background.

1.4 The Company details the background and position of each member of the Board in its annual registration statements (Form 56-1). Shareholders can download this information from the SETs website at www.set.or.th or from the Companys website at www.truecorp.co.th.

1.5 Board policy specifies that directorships held in other companies by the Companys senior executives must be disclosed to their superiors.

1.6 The Chairman of the Board is a non-executive director and the CEO is not the same person as the Chairman. The roles and responsibilities of the Chairman are in accordance with the law. The roles and responsibilities of the CEO are determined by the Board of Directors.

1.7 The Company Secretary serves the Board of Directors by providing legal advice, helping organize the Boards activities, and monitoring compliance with the Boards resolutions. The Company Secretary also meets with counterparts from other listed companies from time to time to discuss best practice.

2. Committees 2.1 As well as the Audit Committee established by the Company according to SET regulations, the Board of Directors has established the following committees to reflect good corporate governance: The Compensation and Nominating Committee is responsible for making recommendation to the Board of Director regarding the compensation of directors and CEO; and the nomination of directors of the Company. The Finance Committee is responsible for assisting the Board of Directors to review and monitor the Companys financial management. The Corporate Governance Committee assists the Board of Directors to establish and review the Companys corporate governance policy as well as making sure that the Company has a sound and appropriate corporate governance practice. The Independent Committee is responsible for reviewing and monitoring Company transactions which may involve highly significant conflicts of interest.


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Shareholders can download the information regarding each committee, such as responsibilities and name lists, from the Companys website at www.truecorp.co.th. The Company has also specified the details of committee members, numbers of meetings attended and committees reports in its annual report and Form 56-1. 2.2 So that the committees can perform their duties transparently, independently, and at the same time effectively, their membership comprises independent directors, creditor-nominated directors and non-executive directors. 3. Roles and Responsibilities of the Board 3.1 The Board of Directors reviews and approves key business matters such as the vision and

mission of the Company, strategy, financial targets, risks, major plans of action and budget. The Board also monitors the performance of management to ensure their efficiency and effectiveness.

3.2 The Board sets and approves a written corporate governance policy for the Company and reviews the policy and its compliance annually.

3.3 The Board of Directors ensures that a written code of business conduct is in place so that all directors, executives and employees understand the Companys ethical standards for doing business. Compliance with the code is closely monitored by the Board.

3.4 The Board of Directors considers transactions involving conflicts of interest thoroughly. It follows clear guidelines on approving such transactions so that they are conducted in the best interests of the Company and all shareholders. The person who has an interest in the transaction does not participate in the decision-making process. The Board also monitors compliance with the regulations regarding criteria, procedures and disclosure of transactions involving conflicts of interest.

3.5 The Board of Directors ensures that internal control systems are in place, including financial, compliance and policy controls, and reviews the system at least annually. The Board also assigns the Audit Committee to monitor the independent audit and report on the system.

3.6 The Company runs a risk management system covering operational and financial risk as well as maintaining internal auditing using a risk-based audit approach. To manage operational risk the Company has established the BCP Steering Committee to develop and maintain a business continuity plan. The Company has also established a Crisis Management Team to support significant business operations of the Company which may face a crisis, by implementing and managing a crisis response. To manage financial risk, the Company has a financial management policy to mitigate risks arising from fluctuations in currency exchange rates. This policy includes entering into forward foreign exchange contracts, negotiating payment terms for individual foreign currency settlements, and negotiating with foreign suppliers to share foreign exchange exposure, etc.

4. Board Meetings 4.1 The Company sets its meeting schedule in advance and notifies each director of this schedule.

However, in an emergency case the Company can also call for an additional Board meeting. 4.2 In the year 2007 the Company held eight Board meetings respectively which are appropriate to

the obligations and responsibilities of the Board and the nature of the Company during the year.

4.3 The Chairman and/or Vice Chairman of the Board and the CEO jointly set the agenda for each Board meeting. Moreover, each Board member is free to suggest agenda items.

4.4 Meeting documents are sent to each director before the meeting. These documents are



concise but contain all relevant information. Any confidential issues are discussed during the meeting.

4.5 The Chairman of the Board allocates enough time for the meeting to receive full presentations from management and host comprehensive discussions by directors.

4.6 The Board is able to access additional information, under a prearranged agreement, via the CEO, the Company Secretary and/or the executive designated as a contact person.

4.7 Top executives attend Board meetings to detail the issues that they are directly responsible for. 5. Board Self Assessment 5.1 The Board of Directors make self-assessment on a yearly basis. 6. Remuneration 6.1 Board members remuneration is commensurate with that of other directors in the Companys industry, and reflects the experience, obligations, range of work, accountability, responsibilities and contributions of each director. Members of the Board with greater responsibilities, such as independent directors who also hold committee memberships, are paid more. In the year 2007, the Company disclosed the remuneration of each director in its annual report and Form 56-1. 6.2 Remuneration of the CEO and top executives is set in accordance with Board policy, within the limits approved by shareholders (for the types of remuneration that require such approval). Executives salaries, bonuses, and other long-term compensation reflect the Companys performance and that of each executive. 6.3 The Compensation and Nominating Committee appraises the performance of the CEO annually to set his compensation. The basis of the appraisal is agreed upon by the CEO ahead of the evaluation. The criteria are objective, including financial performance, long-term strategic performance, career development plan, etc. The results of the appraisal are then presented to the Board for approval. The Chairman of the Board or a senior director communicates the evaluation results to the CEO. 7. Board and Management Training 7.1 The Company encourages and facilitates training for all internal parties who have a role in corporate governance, including directors, members of the Audit Committee, executives, the Company Secretary, etc. Training either internal or external enables them to continuously improve their performances. 7.2 In the year 2007 the Company had two new Directors. To be in line with the Companys policy, the new Directors received material and information beneficial for fulfilling their duties. The Company also provide an introduction to the Companys various businesses and business direction for the new Directors.


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Revenues breakdown

Business Group 2007 2006 (restated) 2005 Baht Million % Baht Million % Baht Million % 1. TrueOnline Revenues 20,490 33.2% 20,791 40.0% 22,143 50.6% 2. TrueMove Revenues 32,366 52.5% 22,694 43.7% 21,648 49.4% 3. TrueVisions Revenues 8,785 14.3% 8,470 16.3% Total Revenues 61,641 100% 51,955 100% 43,791 100%

Revenues for the year ended 31 December 2007 breakdown by company

Business Group / Operation by Baht Million %

1. TrueOnline True Corporation Public Company Limited 11,621 18.9% True Multimedia Co., Ltd. 1,725 2.8% True Internet Co., Ltd. 1,379 2.2% True Leasing Co., Ltd. 655 1.1% True Digital Entertainment Co., Ltd. 1,688 2.7% KSC Commercial Internet Co., Ltd. 403 0.7% Wire & Wireless Co., Ltd. 380 0.6% Asia Wireless Communication Co., Ltd. 416 0.7% True Universal Convergence Co., Ltd. 1,435 2.3% True Public Communication Co., Ltd. 278 0.5% True Touch Co., Ltd. 204 0.3% Others 306 0.4% Revenues 20,490 33.2% 2. TrueMove BITCO Group of companies Revenues 32,366 52.5% 3. TrueVisions True Visinos Group of companies Revenues 8,785 14.3% Total Revenues 61,641 100%

Revenues breakdown by business group



Corporate Information

Company Name Address Type of Paid-up Capital Business

% of investment

Asia DBS Public Company Limited 18 True Tower, DBS system THB 100 million divided into 89.99 Ratchadaphisek Road, operator 10 million ordinary shares Huai Khwang, with a par value of Baht 10 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 Asia Infonet Company Limited 1 Fortune Tower, Internet THB 15 million divided into 65.00 14th, 17th Floors, provider 1.5 million ordinary shares Ratchadaphisek Road, with a par value of Baht 10 Din Dang, Bangkok 10400 each and fully paid up. Tel. (662) 641-1800 Asia Wireless Communication Company 18 True Tower, PCT operator THB 10,441.85 million 99.99 Limited Ratchadaphisek Road, divided into 1,044.18 million Huai Khwang, ordinary shares with a par Bangkok 10310 value of Baht 10 each and Tel. (662) 643-1111 fully paid up. Fax. (662) 643-1651

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

True Corporation Public Company Limited (the Company), with the security symbol TRUE on the Stock Exchange of Thailand, was established on 13th November 1990 initially under the name of CP Telecommunication Co., Ltd. with authorized capital of Baht 1,000 million to undertake a major telecommunication infrastructure project, and registered as a public company limited with registration no. Bor Mor Jor 82 on 11th February 1993. As at 31st December 2007, the companys authorized capital is Baht 47,515,194,180 consisting of 4,052,183,647 ordinary shares with a par value of Baht 10 per share and 699,335,771 preference shares with a par value of Baht 10 per share. The companys paid-up capital is Baht 45,031,791,550 comprising of 3,803,843,384 ordinary shares with a par value of Baht 10 per share and 699,335,771 preference shares with a par value of Baht 10 per share. The companys head office is located at: 18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Telephone: (662) 643-1111 Fax: (662) 643-1651 Website: www.truecorp.co.th

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% of investment

Bangkok Inter Teletech Public Company 18 True Tower, Holding THB 64.266.70 million 75.26 Limited Ratchadaphisek Road, Company divided into 25,706.68 Huai Khwang, million ordinary shares with Bangkok 10310 a par value of Baht 2.50 Tel. (662) 643-1111 each and fully paid up. Fax. (662) 643-1651 BeboydCg Company Limited 1000/6 Liberty plaza Production of THB 16.52 million divided 70.00 building, 20th Floor, music into 1.65 million ordinary Sukhumvit 55, shares with a par value of Sukhumvit Road, Baht 10 each and fully Klongtan-nua, Wattana, paid up. Bangkok 10110 Cineplex Company Limited 118/1 Tipco Tower, Program THB 1,283.43 million divided 91.79 Rama VI Road, production into 128.34 million ordinary Samsen Nai, Phayathai, shares with a par value of Bangkok 10400 Baht 10 each and fully paid Tel. (662) 615-9000 up. Fax. (662) 615-9900 Click TV Company Limited 118/1 Tipco Tower, Interactive THB 46 million divided into 91.79 Rama VI Road, television 4.6 million ordinary shares Samsen Nai, Phayathai, business with a par value of Baht 10 Bangkok 10400 each and fully paid up. Tel. (662) 615-9000 Fax. (662) 615-9900 Channel [V] Music (Thailand) Company 118/1 Tipco Tower, Audio visual THB 65 million divided into 23.87 Limited Rama VI Road, and related 650,000 ordinary shares (formerly Music Bus Company Limited) Samsen Nai, Phayathai, services with a par value of Baht 100 Bangkok 10400 each and fully paid up. Tel. (662) 615-9000 Fax. (662) 615-9900 Future Gamer Company Limited 1035/22 Soi Khunvijit Publication THB 16 million divided into 90.00 Sukhumvit 71 Road, and 1.6 million ordinary shares Klongtan-nua, Wattana, advertising with a par value of Baht 10 Bangkok 10110 each and fully paid up. Tel. (662) 382-1543 Fax. (662) 382-1545 IBC Symphony Company Limited 118/1 Tipco Tower, Dormant THB 30 million divided into 3 91.79 Rama VI Road, million ordinary shares with Samsen Nai, Phayathai, a par value of Baht 10 each Bangkok 10400 and fully paid up. Tel. (662) 615-9000 Fax. (662) 615-9900




% of investment

Internet Knowledge Service Center 2/4 Siam Commercial, Non- THB 50 million divided into 56.93 Company Limited Samaggi Insurance tower, government 12 million ordinary shares 10th Floor, telecommuni- with a par value of Baht 10 Vibhavadee-Rangsit Road, cation each, 2.67 ordinary shares Thungsonghong, Laksi, fully paid up and 9.33 Bangkok 10210 ordinary shares call-up Baht Tel. (662) 979-7000 2.50 each. Internet Shopping Mall Company Limited 2/4 Siam Commercial Training THB 50,000 divided into 58.10 Samaggi Insurance tower, services and 20,000 ordinary shares with 10th Floor, distributor a par value of Baht 10 each Vibhavadee-Rangsit Road, and call-up Baht 2.50 each. Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000 K.I.N. (Thailand) Company Limited 18 True Tower, Holding THB 352.50 million divided 99.99 Ratchadaphisek Road, Company into 11.75 million ordinary Huai Khwang, shares with a par value of Bangkok 10310 Baht 30 each and fully paid Tel. (662) 643-1111 up. Fax. (662) 643-1651 KSC Commercial Internet Company Limited 2/4 Siam Commercial, Internet THB 15 million divided into 37.80 Samaggi Insurance tower, provider 1.5 million ordinary shares 10th Floor, with a par value of Baht 10 Vibhavadee-Rangsit Road, each and fully paid up. Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000 MKSC World Dot Com Company Limited 2/4 Siam Commercial, Internet THB 200,000 divided into 91.05 Samaggi Insurance tower, services and 9,800 ordinary shares with 10th Floor, distributor a par value of Baht 10 each Vibhavadee-Rangsit Road, and 10,200 preference Thungsonghong, Laksi, shares with a par value of Bangkok 10210 Baht 10 each and fully paid Tel. (662) 979-7000 up. Online Advertising Goldsite Company 2/4 Siam Commercial, Publication THB 50,000 divided into 58.10 Limited Samaggi Insurance tower, 20,000 ordinary shares with 10th Floor, a par value of Baht 10 each Vibhavadee-Rangsit Road, and call-up Baht 2.50 each. Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000


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% of investment

Online Station Company Limited 1035/22 Soi Khunvijit Internet THB 1 million divided into 90.00 Sukhumvit 71 Road, service and 100,000 ordinary shares Klongtan-nua, Wattana, e-commerce with a par value of Baht 10 Bangkok 10110 each and fully paid up. Tel. (662) 382-1543 Fax. (662) 382-1545 Red Media Company Limited 118/1 Tipco Tower, Dormant THB 25 million divided into 91.79 Rama VI Road, 2.5 million ordinary shares Samsen Nai, Phayathai, with a par value of Baht 10 Bangkok 10400 each and fully paid up. Tel. (662) 615-9000 Fax. (662) 615-9900 Samut Pakan Media Corporation 18 True Tower, Telecommuni- THB 1 million divided into 75.21 Company Limited Ratchadaphisek Road, cation services 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 Satellite Service Company Limited 118/1 Tipco Tower, Sales and THB 2,880 million divided 91.79 Rama VI Road, rental of into 480 million ordinary Samsen Nai, Phayathai, equipment shares with a par value of Bangkok 10400 related to Pay Baht 6 each and fully paid Tel. (662) 615-9000 Television up. Fax. (662) 615-9900 Song Dao Company Limited 18 True Tower, Collection THB 1 million divided into 75.21 Ratchadaphisek Road, agent 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 Tele Engineering and Services Company 18 True Tower, Content THB 25 million divided into 99.99 Limited Ratchadaphisek Road, provider 2.5 million ordinary shares Huai Khwang, with a par value of Baht 10 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 Telecom Equipment Manufacturing 18 True Tower, Dormant THB 24 million divided into 59.99 Company Limited Ratchadaphisek Road, 2.4 million ordinary shares Huai Khwang, with a par value of Baht 10 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651



% of investment

Telecom Holding Company Limited 18 True Tower, Holding THB 17,300.25 million 99.99 Ratchadaphisek Road, Company divided into 1,743.53 million Huai Khwang, ordinary shares with a par Bangkok 10310 value of Baht 10 each, Tel. (662) 643-1111 1,722.53 million ordinary Fax. (662) 643-1651 shares fully paid up and 21 million ordinary shares call-up Baht 3.57 each. Telecom International Company Limited 18 True Tower, Holding THB 300 million divided into 99.99 Ratchadaphisek Road, Company 30 million ordinary shares Huai Khwang, with a par value of Baht 10 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 Telecom KSC Company Limited 2/4 Siam Commercial, Non- THB 250,000 divided into 34.39 Samaggi Insurance tower, government 100,000 ordinary shares 10th Floor, telecommuni- with a par value of Baht 10 Vibhavadee-Rangsit Road, cation each and call-up Baht 2.50 Thungsonghong, Laksi, each. Bangkok 10210 Tel. (662) 979-7000 Telecom Training and Development 18 True Tower, Training THB 120 million divided into 99.99 Company Limited Ratchadaphisek Road, service 13 million ordinary shares Huai Khwang, with a par value of Baht 10 Bangkok 10310 each, 5 million ordinary Tel. (662) 643-1111 shares fully paid up and Fax. (662) 643-1651 8 million ordinary shares call-up Baht 8.75 each. True Digital Entertainment Company Limited 1 Fortune Tower, Online game THB 718.5 million divided 99.99 25th Floor, into 97.5 million ordinary Ratchadaphisek Road, shares with a par value of Din Dang, Bangkok 10400 Baht 10 each, 63.30 million Tel. (662) 641-1800 ordinary shares fully paid up and 34.20 million ordinary shares call-up Baht 2.50 each. True Distribution and Sales Company 18 True Tower, Retail services THB 1 million divided into 75.14 Limited Ratchadaphisek Road, 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 True International Communication 18 True Tower, Telecommuni- THB 1 million divided into 99.94 Company Limited Ratchadaphisek Road, cation service 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 each Bangkok 10310 and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651



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% of investment

True Internet Company Limited 1 Fortune Tower, Internet THB 511.2 million divided 99.99 14th, 27th Floors, solution into 60.28 million ordinary Ratchadaphisek Road, provider shares with a par value of Din Dang, Bangkok 10400 Baht 10 each, 23.64 million Tel. (662) 641-1800 ordinary shares fully paid up and 36.64 million ordinary shares call-up Baht 7.50 each True Internet Data Center Company Limited 18 True Tower, Internet data THB 149.59 million divided 70.00 14th Floor, center into 14.96 million ordinary Ratchadaphisek Road, shares with a par value of Huai Khwang, Baht 10 each and fully paid Bangkok 10310 up. Tel. (662) 643-1111 Fax. (662) 643-1651 True Internet Gateway Company Limited 1 Fortune Tower, Telecommuni- THB 51 million divided into 99.99 15th Floors, cation and 510,000 ordinary shares Ratchadaphisek Road, internet services with a par value of Baht Din Dang, Bangkok 10400 100 each and fully paid Tel. (662) 641-1800 up. True Leasing Company Limited 18 True Tower, Rental services THB 2,462 million divided 99.99 Ratchadaphisek Road, into 246.20 million ordinary Huai Khwang, shares with a par value of Bangkok 10310 Baht 10 each and fully paid Tel. (662) 643-1111 up. Fax. (662) 643-1651 True Lifestyle Retail Company Limited 18 True Tower, Internet cafe THB 131 million divided into 99.99 Ratchadaphisek Road, and related 13.1 million ordinary shares Huai Khwang, services with a par value of Baht 10 Bangkok 10310 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 True Magic Company Limited 18 True Tower, Production THB 3.5 million divided into 99.99 Ratchadaphisek Road, and 350,000 ordinary shares Huai Khwang, distribution of with a par value of Baht 10 Bangkok 10310 movies film each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 True Money Company Limited 18 True Tower, Payment THB 200 million divided into 99.99 Ratchadaphisek Road, service center 20 million ordinary shares Huai Khwang, and electronic with a par value of Baht 10 Bangkok 10310 card services each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651





% of investment

True Move Company Limited 18 True Tower, Cellular THB 33,600.17 million 75.19 Ratchadaphisek Road, operator divided into 3,360.02 million Huai Khwang, ordinary shares with a par Bangkok 10310 value of Baht 10 each and Tel. (662) 643-1111 fully paid up. Fax. (662) 643-1651 True Multimedia Company Limited 18 True Tower, NON-POTS THB 6,562 million divided 91.08 Ratchadaphisek Road, and into 656.2 million ordinary Huai Khwang, multimedia shares with a par value of Bangkok 10310 services Baht 10 each and fully paid Tel. (662) 643-1111 up. Fax. (662) 643-1651 True Music Company Limited 18 True Tower, Content THB 50,000 divided into 75.16 (formerly Internet KSC Company Ratchadaphisek Road, provider 20,000 ordinary shares with Limited) Huai Khwang, a par value of Baht 10 each Bangkok 10310 and call-up Baht 2.50 each. Tel. (662) 643-1111 Fax. (662) 643-1651 True Music Radio Company Limited 23/6-7, 2nd 4th Floor , Trading and THB 1 million divided into 69.94 Soi Soonwijai, Rama 9 Road, production of 10,000 ordinary shares with Bangkapi, Bangkok advertising media a par value of Baht 100 each Tel. (662) 641-4838-9 and fully paid up. Fax. (662) 641-4840 True Properties Company Limited 18 True Tower, Rental services THB 3,488 million divided 99.99 Ratchadaphisek Road, into 34.88 million ordinary Huai Khwang, shares with a par value of Bangkok 10310 Baht 100 each and fully Tel. (662) 643-1111 paid up. Fax. (662) 643-1651 True Public Communication 18 True Tower, Telecommuni- THB 1 million divided into 99.94 Company Limited Ratchadaphisek Road, cation services 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 each Bangkok 10310 and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 True Touch Company Limited 18 True Tower, Call center THB 193 million divided into 99.99 Ratchadaphisek Road services 1.93 million ordinary shares Huai Khwang, with a par value of Baht Bangkok 10310 100 each and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651


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% of investment

True Universal Convergence 18 True Tower, Telecommuni- THB 1 million divided into 99.94 Company Limited Ratchadaphisek Road, cation services 10,000 ordinary shares with Huai Khwang, a par value of Baht 100 each Bangkok 10310 and fully paid up. Tel. (662) 643-1111 Fax. (662) 643-1651 True Visions Public Company Limited 118/1 Tipco Building, Pay Television THB 2,266.72 million divided 91.79 Rama VI Road, into 755.57 million ordinary Phayathai,Bangkok 10400 shares with a par value of Tel. (662) 615-9000 Baht 3 each and fully paid Fax. (662) 615-9900 up. True Visions Cable Public Company Limited 118/1 Tipco Tower, Pay television THB 7,608.65 million divided 91.19 Rama VI Road, via cable system into 760.86 million ordinary Samsen Nai, Phayathai, shares with a par value of Bangkok 10400 Baht 10 each and fully paid Tel. (662) 615-9000 up. Fax. (662) 615-9900 UBC Fantasia Company Limited 118/1 Tipco Tower, Artist THB 25 million divided into 91.79 Rama VI Road, management 2.5 million ordinary shares Samsen Nai, Phayathai, and related with a par value of Baht 10 Bangkok 10400 business each and fully paid up. Tel. (662) 725-7400 Fax. (662) 725-7401 Wire & Wireless Company Limited 54 W&W Building, Construction THB 100 million divided into 87.50 Pattanakarn 20, 10 million ordinary shares Suanluang, with a par value of Baht 10 Bangkok 10250 each and fully paid up. Tel. (662) 717-9000 Fax. (662) 717-9900 NC True Company Limited 18 True Tower, Developer and THB 174.91 million divided 50.00 18th Floor, service provider into 8.57 million ordinary Ratchadaphisek Road, of games online shares and 8.92 million but Huai Khwang, preference shares with a par 40.00 Bangkok 10310 value of Baht 10 each and Voting Tel. (662) 643-1111 fully paid up. Rights Fax. (662) 643-1651 Asia Remanufacturing Industries 102, 15th Floor, Modification, THB 5.6 million divided into 20.00 Company Limited Na Ranong Road, repair and 56,000 ordinary shares with Klongtoey, Bangkok 10110 maintenance a par value of Baht 100 each Services and fully paid up. Thai Smart Card Company Limited 191 Silom Complex Central Service THB 1,200 million divided 15.76 Building, 27th Floor, Bureau for into 160 million ordinary Room No. 2, Silom Road, clearing shares with a par value of Bangrak, Bangkok electronic Baht 10 each, 80 million Payment ordinary shares fully paid up Transactions and 80 million shares call-up Baht 5 each.

Shareholding




% of investment

NEC Corporation (Thailand) Company 159 Sermmit Tower 2nd, Telecommuni- THB 343 million divided into 9.62 Limited 24th Floor, Sukumvit 21, cation equipment 343,000 ordinary shares Klongtoey Nua, Wattana, manufacturer with a par value of Baht Bangkok 1,000 each and fully paid up. AnyMobile Inc. 1-4-30 Roppongi, International Yen 18 million divided in to 41.35 Minato-ku, Direct Dialing 1,800 ordinary shares with Tokyo, Japan (IDD) a par value of Yen 10,000 telecommunication each and fully paid up. service International Broadcasting Corporation 8 Levine Blvd. Dormant USD 1 million divided into 1 64.25 (Cambodia) Company Limited Phnom Penh City, million ordinary shares with Cambodia a par value of USD 1 each and fully paid up. K.I.N. (Thailand) Company Limited P.O. Box 957, Holding USD 1 divided into 1 99.99 Offshore Incorporation, Company ordinary share with a par Road Town, Tortola, value of USD 1 each and British Virgin Island fully paid up. Nilubon Company Limited P.O. Box 71, Holding USD 8,000 divided into 99.99 Craigmuir Chambers, Company 8,000 ordinary shares with a Road Town, Tortola, par value of USD 1 each and British Virgin Island fully paid up. TA Orient Telecom Investment Company 3/F, Hing Yip Commercial Holding USD 15 million divided into 99.99 Limited Centre, Company 15 million ordinary shares 272 Des Voeus Road C., with a par value of USD 1 Hong Kong each and fully paid up. Telecom Asia (China) Company Limited P.O. Box 957, Communication USD 10 divided into 10 99.99 Offshore Incorporation ordinary shares with a par Road Town, Tortola, value of USD 1 each and British Virgin Island fully paid up. Telecom International China Company P.O. Box 71, Communication USD 10 divided into 10 99.99 Limited Craigmuir Chambers, ordinary shares with a par Road Town, Tortola, value of USD 1 each and British Virgin Island fully paid up. Chongqing Communication Equipment 140 Daping Zhengjie Telecommuni- RMB 292 million. 38.21 Company Limited Chongqing, cation equipment Peoples Republic of China manufacturer


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References

Registrar : Thailand Securities Depository Company Limited 62 The Stock Exchange of Thailand Building, Rachadapisek Road, Klongtoey, Bangkok 10110 Telephone: (662) 229-2888 Fax: (662) 359-1259 Website: http://www.tsd.co.th Auditor : Mrs. Nattaporn Phan-Udom (Certified Public Accountant (Thailand) No. 3430) and/or Mr. Boonmee Ngotngamwong (Certified Public Accountant (Thailand) No. 3673) and/or Mrs. Anothai Leekitwattana (Certified Public Accountant (Thailand) No. 3442) PricewaterhouseCoopers ABAS Limited 179/74-80 Bangkok City Tower, 15th Floor, South Sathorn Road, Sathorn, Bangkok 10120 Telephone: (662) 286-9999, (662) 344-1000 Fax: (662) 286-5050 Debenture Registrar/ : TMB Bank Public Company Limited Debentureholders 393 Silom Road, Bangrak, Bangkok 10500 Representative Telephone: (662) 230-5575, (662) 230-5487, (662) 230-5731 Fax: (662) 266-8150


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Risk Factors

While True sees many opportunities for growth in 2008, there are a number of general and specific factors that could impact the companys performance and that of its subsidiaries. Risks relating to our operations We, as a group, have experienced, and expect to continue to experience, increasing competition in the businesses in which we operate. True and its subsidiaries, particularly TrueMove and the Internet and Broadband businesses, face increasing competition. The Thai mobile communications sector experienced intense price competition in 2005 and 2006, resulting in tariff reductions and declines in ARPU and margin. Our blended ARPU for TrueMove declined by 10 percent in 2005 (from Baht 437 in 2004 to Baht 393) and by 26 percent in 2006 (to Baht 292). The increase in subscriber additions and increase in usage we experienced following this period of intense price competition required us to make additional capital expenditures to alleviate congestion and expand our network capacity. Our EBITDA margin in 2006 declined to 21.4 percent (from 23.4 percent in 2005). However, 2007 saw the industry moving to more rational competition as operators entered into the interconnection regime which requires them to pay for access to other networks (Bt 1 per minute on average), putting a floor on prices. Operators have increased tariffs gradually resulting in lower usage, due to consumers price sensitivity. TrueMove ARPU declined further by 35 percent in 2007 (to Baht 191) from lower usage; however, its EBITDA margin improved to 29.1 percent, mainly attributable to the removal of access charges. More market competition may result in 2008 if the National Telecommunication Commission (NTC) allows telecom operators to launch additional services, introduces number portability or grants telecom licenses to new operators. Recent changes of ownership in our key competitors may also expose us to competition from foreign-owned operators with more experience in other competitive markets and greater financial resources. In the broadband Internet market, we will face competitors ranging from start-up Internet companies to multinational companies, whose applications for ISP licenses were approved by the NTC in 2005. At the beginning of 2006 the NTC granted a fixed-line license to TT&T Broadband Company Limited. TT&T could provide fixed line and broadband Internet services nationwide. The NTC also granted fixed-line (including broadband) licenses to AISs subsidiary, namely Super Broadband Network Company Limited. Competition will intensify after these newly licensed operators launch their services. In addition, Trues wireline business will face indirect and growing competition from mobile phone businesses and Voice over Internet Protocol (VoIP) services, whose tariffs are lower than those for traditional wireline services. We expect competition to remain intense, but we believe True is well positioned to meet this competition given our leadership position through our ability to provide fully integrated services together with the strength of our brand. TrueMove has captured one third of subscriber additions in the Thai mobile market every year since 2004 and True Group still maintains its market leadership in Internet and Broadband due to the advantages of its modern fixed-line network. Trues subsidiaries have applied for new licenses to take advantage of new opportunities offered by regulatory reform and to compete fairly with other operators. At the time of writing, we have been granted an ISP license, an international Internet gateway license, a public phone license, a fixed-line license, an International



Direct Dialing (IDD) license, one-year trial licenses for International Private Leased Circuit (IPLC) and International Internet Protocol Virtual Private Network (IP VPN), and a six-month trial license for WiMax. Rapid technological change could also adversely affect the viability of Trues business and make its current technology less competitive. The communications industry is characterized by rapid changes in technology, evolving customer needs and new products and services. These changes are, in some cases, brought about by regulators opening up the market. Key emerging technologies for the Thai communications industry in the near future are expected to include third generation (3G) mobile phones, wireless broadband (WiMax), and number portability services. In order to respond successfully to emerging industry trends, we may be required to make substantial capital expenditure given the industrys capital intensive nature. But if we do not invest in the new technology it will lower our competitiveness. However, we believe that integrated operators, such as ourselves, with diversified services, products, revenues and customer bases, are in a better position to cope with these rapid changes than are pure play operators. We believe that we have a stronger ability to manage potential revenue cannibalization from new technologies by being able to keep allied services and revenues in-house and by being able to balance customers relationships across our brand, whether mobile, broadband or fixed line . Risks relating to regulatory environment Thailands communications industry is in a state of transition and a significant degree of uncertainty exists regarding the regulatory environment. In accordance with Thailands commitment to the World Trade Organization (WTO) to liberalize its telecommunications sector by 2006, the Thai government embarked on a reform of the countrys telecommunications regulatory regime with the passage of two major legislative acts: the Organizations Allocating Frequency Waves and Supervising Radio and Television Broadcasting and Telecommunications Business Act, or the NTC Act, in March 2000; and the Telecommunications Business Operation Act, or the TBO Act, in November 2001. In October 2004, the NTC was established as the independent regulator of the telecommunications industry, assuming the regulatory functions previously exercised by the Telephone Organization of Thailand (now known as TOT Public Company Limited), or the TOT, the Communications Authority of Thailand (now known as CAT Telecom Public Company Limited), or CAT, and the Post and Telegraph Department. From its establishment to the end of 2007, the NTC has issued regulations prescribing, among other things: (1) licensing requirements for the various defined categories of telecommunications services; (2) eligibility requirements and application procedures for the three categories of telecommunications licenses available in Thailand; (3) interim regulations for allocating telephone numbers; (4) the change of mobile phone numbers from 9-digits to 10-digits; (5) anti-monopoly and unfair competition rules; (6) the interconnection regulation; (7) procedures for receiving and considering subscribers complaints; (8) standards of telecommunications service contracts; (9) price caps and prepaid collection; (10) resale of services; (11) frequency use license transfer and measures for frequency sharing for telecom services; and (12) broadband wireless access for trial The NTC is expected to issue a number of additional policies and regulations in 2008 that may have a significant impact on our business. The section 47 of new constitution enacted in August 2007 indicates that a new regulatory body, the National Broadcasting and Telecommunication Commission (NBTC) will be set up to regulate the telecom and broadcasting industry, and be the only regulatory body.


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Since the NBTC is not yet established, the Company is unable to predict how the NBTC will exercise its regulatory authority. However, the new constitution states that the Act for the setting up of the NBTC must be enacted within 180 days of the new government announcing its policy. Delays in the establishment of the NBTC may delay the issuing of licenses for new telecom services that require the allocation and management of radio frequency including mobile phone business. This is despite the fact that the NTC maintains its regulatory power until the NBTC will be established. The Radio and Television Broadcasting Act B.E. 2551 has given authority and power for the existing NTC to temporarily regulate and grant (one-year) licenses for community radio and other services that do not require radio frequencies before the NBTC can be set up. If the regulator does not issue a license to TrueMove before the concession contract expires in September 2013, the company will not be able to continuously pursue its business and t

Documents

TRUE : Annual Report 2007