Executive Summary and Overview The consolidated profit for 1Q2015 was Baht 82 million or Baht 0.14 per share. A decrease of Baht 14 million or 15% over 4Q2014 (Baht 96 million), and Baht 36 million or 31% by compared with the same period of last year (1Q2014 = Baht 118 million). The detail are given below: ICT Business: Had a net profit from the operation for 1Q2015 Baht 58 million, roughly equivalent to that in the same period of last year (1Q2014). However, by comparing with 4Q2014, the net profit from the operation had decreased Baht 9 million. This was due to more ICT project sales completed/recognized and had delivered to customer in last quarter. Media and Advertising on YellowPages Business: Had a net loss from the operation for 1Q2015 Baht 4 million, dropped from 4Q2014 and 1Q2014 which had a net profit from the operation of Baht 1 million and Baht 2 million, respectively. This was due to the media & advertising industry had continued to decline. Moreover, online media (YellowPages Onlie) had slightly growth and had lower price when compared to print media. Voice Info Services & Mobile Content Business: Had a net profit from the operation for 1Q2015 Baht 28 million, roughly equivalent to that in the previous quarter (4Q2014). However, by comparing with the same period of last year (1Q2014), the net profit from the operation had decreased Baht 29 million. This was due to an extension of an expiration date for prepaid telephone cards declared by the National Broadcasting and Telecommunications Commission (NBTC) which led the customers to change their spending behavior to use more voice calls than other content usages and in parallel with, the softening economy and lower purchasing power. Business Summary ICT Business Operated by CS LoxInfo Plc., The Leading total solution ICT Service Provider to corporate clients ICT Business, Not only its strenghts of being the leading corporate internet services and data center services but also having flexible ICT solution which meet customers needs, as well as smooth and reliable after sales-service. As at the end of the end of 1Q2015, CSL had corporate client subscribers (small, medium and large) as follows: Unit: Sub Number of Subscribers 1Q2014 4Q2014 1Q2015 Leased line 5,116 5,498 5,553 Internet Data Center (IDC) 372 434 451 The number of subscribers for core services had continuously increased by 1% and 4% over the previous quarter, respectively. This was a result from the growth of new customers and bandwidth usage for our corporate customers. Page 1/9
Media and Advertising on YellowPages Operated by Teleinfo Media Plc. ( TMC ), the subsidiary, is the commercial search providers and largest directory publisher. Its database consisted of all type of products and services nationwide such as business listing for business to business (B2B) and business to customers (B2C). Currently, TMC has been putting more effort into focusing on publishing various new vertical books in order to compensate for a decline in the sale of advertising space in the Thailand YellowPages, such as Aroi for Thailand, Factory Guide, Machine Parts & Hardware Tools, and Builder & Construction Guide etc. Voice Info Services and Mobile Content Business This business comprises of 1) Outsourcing Call Center Services that operated by Teleinfo Media Plc. ( TMC ), and 2) Mobile Content Services that operated by AD Venture Plc. ( ADV ). The main revenue streams of this business come from information inquiries via 1188 call center and content products such as general news, entertainment news, and horoscope via Short Massage Services (SMS) through all mobile phone networks and the Audiotex system (1900xxx). Currently, ADV is focusing on selected/developing new contents to provide a variety of services in order to attract consumers wants and usages, parallel with, developing various new applications for smart phones users and expending to corporate segment. Operating Results The consolidated financial statement for the three month periods ending 31 March 2015 compared to the consolidated financial statement for the three month periods ending 31 December 2014 4Q2014 Unit: Million Baht Change 1Q2015 % QoQ Revenues from sales and services 773 739 (4) Other incomes 19 6 (68) Total revenue 792 745 (6) Cost of sales and services 483 460 (5) SG&A expenses 182 175 (4) Financial cost 6 5 (17) Net profit from operation 121 105 (13) Income tax 25 23 (8) Net income 96 82 (15) Earnings per share (Baht/Share) 0.16 0.14 (13) Page 2/9
Total Revenue from sales and services CSL earned Baht 739 million in total revenues from sales and services for 1Q2015. The main revenue streams were, firstly, ICT Business; secondly, Media and Advertising on YellowPages; and thirdly, Voice Info Services & Mobile Content Services business. The details are as below: 1) Revenue from ICT Business Revenue from ICT Business for 1Q2015 was Baht 568 million, a decrease of Baht 31 million or 5% from 4Q2014. The details are as below: Revenue from ICT Business 4Q2014 (MB) 1Q2015 (MB) Change (%) Leased Line 347 349 1 Internet Data Center (IDC) 60 61 2 ICT & Cloud Services (Internet, Computer and Telecom) 168 139 (17) Broadband 11 8 (27) Other value added services 13 11 (15) Total 599 568 (5) Revenue from Leased line services and Internet Data Center (IDC) Services grew up 1% and 2% over the previous quarter, respectively. This was a result from the growth of new customers and bandwidth usage for our corporate customers. However, revenue from ICT & Cloud services had decreased from 4Q2014. This was due to lower large project sales had been completed/delivered to our customers, compared to previous quarter. While revenue from broadband services had continued to decrease due to intense price competition, however, this service had contributed low revenue portion which did not affected to total ICT revenue, and CSL has putting more effort to focus on core products (Leased Line Services, Internet Data Center Services and ICT & Cloud Computing Services) which had more competitve advantage. 2) Revenue from Media and Advertising on YellowPages Revenue from Media and Advertising on YellowPages for 1Q2015 was Baht 60 million, a decrease of Baht 7 million or 10% over previous quarter (Baht 67 million) from lower issuing and launching a new vertical book compared to previous quarter. 3) Revenue from Voice Info Services & Mobile Content Business Revenue from Voice Info Services and Mobile Content Business for 1Q2015 was Baht 111 million, slightly increase of Baht 4 million or 4% from the previous quarter (Baht 107 million). This was resulted from the impact of an extension of an expiration date for prepaid telephone cards declared by NBTC which led the customers to change their spending behavior to use more voice calls than other content usages. Page 3/9
Cost of sales and services Costs for sales and services for 1Q2015 was Baht 460 million, a decrease of Baht 23 million or 5% from 4Q2014 (Baht 483 million). The details are given below: 1) Cost of ICT Business Cost associated with ICT Business for 1Q2015 was Baht 372 million, a decrease of Baht 31 million or 8% over previous period (Baht 403 million). This was resulted lower cost of ICT project sales had been completed and delivered to our customers. 2) Cost of Media and Advertising on YellowPages Cost of Media and Advertising on YellowPages for 1Q2015 was Baht 22 million, an increase of Baht 2 million or 10% from previous quarter (Baht 20 million) due to higher paper cost and cost of publishing. 3) Cost of Voice Info Services & Mobile Content Business Cost of Voice Info Services & Mobile Content Business for 1Q2015 was Baht 66 million, an increase of Baht 6 million or 10% from previous quarter (baht 60 million). This was resulted from an increase of revenue sharing paid to the content providers. Selling and Administrative Expenses Selling and administrative expenses for 1Q2015 was Baht 175 million, a decrease of Baht 7 million or 4% from previous quarter (Baht 182 million). The details are given below: 1) Selling and administrative expenses of ICT Business Selling and administrative expenses of ICT Business for 1Q2015 was Baht 120 million, a decrease of Baht 4 million or 3% from previous quarter (Baht 124 million) due to lower marketing and staff expenses (normally, CSL will spends more marketing expenses in the fourth quarter of each year for boots it sales and maintains current customers base). 2) Selling and administrative expenses of Media and Advertising on YellowPages Selling and administrative expenses of Media and advertising on YellowPages for 1Q2015 was Baht 44 million, roughly equivalent to that in previous quarter. 3) Selling and administrative expenses of Voice Info Services & Mobile Content Business Selling and administrative expenses of Voice Info Services & Mobile Content Business for 1Q2015 was Baht 11 million, a decrease of Baht 2 million or 15%. This was resulted the company started to change marketing policy by doing the campaign directly through our content providers. Page 4/9
Other incomes Other incomes for 1Q2015 was Baht 6 million, a decrease of Baht 13 million or 68% from previous quarter (Baht 19 million) from capital return from a subsidiary at the end of last year. (Loxley Information Services Co., Ltd. registered the liquation with the Ministry of Commerce on 29 May 2008, and had completed its liquidation and paid the capital return to its shareholders in December 2014). The consolidated financial statement for the three-months ending 31 March 2015 compared to the consolidated financial statement for the three-months ending 31 March 2014. 1Q2014 Unit: Million Baht Change 1Q2015 % YoY Revenues from sales and services 737 739 - Other incomes 4 6 50 Total revenue 741 745 1 Cost of sales and services 412 460 12 SG&A expenses 179 175 (2) Financial cost 2 5 150 Net profit from operation 148 105 (29) Income tax 30 23 (23) Net Income 118 82 (31) Earnings per share (Baht/Share) 0.20 0.14 (30) Total Revenue from sales and services CSL earned Baht 739 million in total revenues from sales and services for 1Q2015. The main revenue streams were, firstly, ICT Business; secondly, Media and Advertising on YellowPages; and thirdly, Voice Info Services & Mobile Content Services business. The details are as below: 1) Revenue from ICT Business Revenue from ICT Business for 1Q2015 was Baht 568 million, an increase of Baht 58 million or 11% as compared to the same period of last year (Baht 510 million). The details are as below: Revenue from ICT Business 1Q2014 (MB) 1Q2015 (MB) Change (%) Leased Line 333 349 5 Internet Data Center (IDC) 52 61 17 ICT & Cloud Services (Internet, Computer and Telecom) 99 139 40 Broadband 13 8 (38) Other value added services 13 11 (15) Total 510 568 11 Page 5/9
Revenue from core products (Leased Line, IDC and ICT services) still had continuously grown as compared to the same period of last year. This was a result from the growth of new customers and bandwidth usage for our corporate customers while revenue from Broadband services still decreased due to an intense price competition. However, currently, the Company started to launch new marketing strategy in some areas that can be competitive. This is expected to growth of revenue from this service in long term. 2) Revenue from Media and Advertising on YellowPages Revenue from Media and Advertising on YellowPages for 1Q2015 was Baht 60 million, a decrease of Baht 26 million or 30% as compared to the same period of last year (Baht 86 million). This was due to the media & advertising industry had continued to decline. However, online media (YellowPages Onlie) had slightly growth and had lower price when compared to print media, so it could not compensate to a decline in the sale of advertising space in the Thailand YellowPage. 3) Revenue from Voice Info Services & Mobile Content Business Revenue from Voice Info Services and Mobile Content Business for 1Q2015 was Baht 111 million, a decrease of Baht 30 million or 21% as compared to the same period of last year (Baht 141 million). This was due to the softening economy, in parallel with, an extension of an expiration date for prepaid telephone cards declared by the National Broadcasting and Telecommunications Commission (NBTC) which led the customers to change their spending behavior to use more voice calls than other content usages. Cost of sales and services Costs for sales and services for 1Q2015 was Baht 460 million, an increase of Baht 48 million or 12% as compared to the same period of last year (Baht 412 million). The details are given below: 1) Cost of ICT Business Cost associated with ICT Business for 1Q2015 was Baht 372 million, an increase of Baht 47 million or 14% from the same period of last year (Baht 325 million). This was due to an increase of network rental fee for leased line service and cost of ICT project sales as its revenue increased. 2) Cost of Media and Advertising on YellowPages Cost of Media and Advertising on YellowPages for 1Q2015 was Baht 22 million, a decrease of Baht 11 million or 33% as compared to the same period of last year (Baht 33 million) which was resulted from a publishing cost control to compensate with the decrease of its revenue. 3) Cost of Voice Info Services & Mobile Content Business Cost of Voice Info Services & Mobile Content Business for 1Q2015 was Baht 66 million, an increase of Baht 11 million or 20% as compared to the same period of last year (Baht 55 million). This was resulted from higher cost of services due to the company started to change marketing policy by doing the campaign directly through our content providers. Page 6/9
Selling and Administrative Expenses Selling and administrative expenses for 1Q2015 was Baht 175 million, a decrease of Baht 4 million or 2% as compared to the same period of last year (Baht 179 million). The details are given below: 1) Selling and administrative expenses of ICT Business Selling and administrative expenses of ICT Business for 1Q2015 was Baht 120 million, an increase of Baht 8 million or 7% as compared to the same period of last year (Baht 112 million) due to higher staff expenses from merit increased and marketing expenses. 2) Selling and administrative expenses of Media and Advertising on YellowPages Selling and administrative expenses of Media and advertising on YellowPages for 1Q2015 was Baht 44 million, a decrease Baht 8 million or 15% as compared to the same period of last year (Baht 52 million). This was due to a decrease of staff expenses (restructuring the organization) and marketing expenses to compensate with the decrease of its revenue. 3) Selling and administrative expenses of Voice Info Services & Mobile Content Business Selling and administrative expenses of Voice Info Services & Mobile Content Business for 1Q2015 was Baht 11 million, a decrease of Baht 4 million or 27% as compared to the same period of last year (Baht 15 million). This was mainly due to the company started to change marketing policy by doing the campaign directly through our content providers. Financial Position The major asset components comprise of the following: Unit: Million Baht 31 December 2014 31 March 2015 MB % of total assets MB % of total assets Cash and cash equivalents 386 21 423 23 Trade accounts receivable, accrued income and other receivable 491 26 466 25 Other current assets 44 2 35 2 Total current assets 921 49 924 49 Property, plant and equipment net 815 43 801 43 Other non-current assets 159 8 151 8 Total assets 1,895 100 1,876 100 Short term loan from financial institution 230 12 250 13 Trade and other accounts payable 436 23 368 20 Dividend payable - - 95 5 Current portion of long-term loans from financial institution 60 3 60 3 Unearned income and advances received 186 10 128 7 Other current liabilities 42 2 49 3 Total current liabilities 954 50 950 51 Long term loan from financial institution 160 8 160 9 Other non-current liabilities 169 9 167 9 Total liabilities 1,283 68 1,277 68 Total equity 612 32 599 32 Page 7/9
Assets As at 31 March 2015, CSL had total assets of Baht 1,876 million, a decrease of Baht 19 million or 1% from the end of 2014. This was due to the following: Cash and cash equivalents increased Baht 37 million or 10% over the end of last year. This was mainly come from ICT Business. Trade accounts receivable, accrued income and other receivable net decreased Baht 25 million or 5% from the end of last year. This was mainly resulted from the collection of A/R advertising sales in Thailand YellowPages Book (BKK & UPC), which had been invoiced in May and October 2014 and A/R Mobile Content Business (ADV) due to a decrease of number of subscribers and download transactions, which was impacted from soften economic situation. Other current assets decreased Baht 9 million or 20%. This was mainly come from a decrease in inventories of ICT Business due to some of project sales had been completed and delivered to its customers. Property, plant and equipment decreased Baht 14 million or 2% from the end of last year from the amortization during the period. Liabilities and equity Liabilities As of 31 March 2015, CSL had total liabilities of Baht 1,277 million, roughly equivalent to that in the end of last year. This was due to the following: Short-term loans from Financial institution was the promissory note for working capital of ICT Business Trade and other accounts payable decreased Baht 68 million or 16% from A/P internet equipment of ICT Business Dividend payable of Baht 95 million was the dividend paid from 4Q2014 performance, which was announced after the resolution of 2015 AGM Meeting (25 March 2015) of Baht 0.16 per share. This dividend had been paid to its shareholders on 22 April 2015. Unearned income and advance receipts decreased Baht 58 million or 31% from the recognition of revenue of advertising sales in Thailand YellowPages Books. Other current liabilities increased Baht 7 million or 17% from the end of last year. This mainly resulted from income tax payable for 1Q2015 performance. Total Equity As of 31 March 2015, CSL had total equity of Baht 599 million, a decrease of Baht 13 million or 2% from the end of last year. This was due to the following: Net profit for the first three-month periods of Y2015 of Baht 82 million Dividend payment from 4Q2014 performance of Baht 95 million (Baht 0.16 per share) which had already paid to its shareholders on 22 April 2015 Page 8/9
Cash Flow Statement Net cash flow provided by operating activities for 3M/2015 was Baht 67 million and the net cash flow used in investing activities was Baht 42 million, which mostly for normal CAPEX of ICT Business. Net cash flow used in financing activities for 3M/2015 was Baht 12 million. This was mainly come from an additional promissory note for ICT Business net off the repayment of long-term loan and interest expenses to the financial institution. As at 31 March 2015, CSL had ending cash of Baht 423 million in consolidated financial statements and of Baht 273 million in Separated financial statements, respectively. This document contains certain forward-looking statements. They refer to future events and to the future financial performance of the Companies. Forward-looking statements generally can be identified by the use of forward-looking terminology such as may, will, expect, intend, estimate, anticipate, believe or continue. Although the Companies believe that the expectations reflected in such forward-looking statements are reasonable at this time, it can give no assurance that such expectations will prove to be correct. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Page 9/9