Message from the Chief Executive Officer

Dear Shareholders

Mr. Anavin Jiratomsiri
Chairman of Executive Committee

2018 was another year that witnessed CHOW driving the expansion of both steel billet business and renewable energy business to a greater extent. For steel billet manufacture and distribution, we grew our sales volume from 150,000 tons in the previous year to 187,000 tons, resulting in sales revenue growth by 813.3 million baht or 35.9% to 3,077.8 million baht year-on-year. Sales growth was recorded both domestically and overseas. Net growth of steel business in 2018 was lower than the target due to uncontrollable factors in the global steel market.

Meanwhile, renewable energy business in 2018 has been growing according to the business plan in terms of sales of electricity from the fully developed projects and sale of solar power plant projects to the Infrastructure Fund in Japan regarding to the policy to add asset value for income generation in preparation of cash flows to serve new investment in future renewable energy projects. In 2018, we have been expanding investment in solar power projects in Japan with generating capacity increasing from 38.3 MW(DC) in 2017 to 65.8 MW(DC) in 2018. (6.6 MW(DC) was generating capacity in Thailand and 59.2 MW(DC) was in Japan). These projects were pushing up electricity sales to 700.7 million baht, increasing 218.1 million baht.

In the business plan of saling solar power project to the Infrastructure Fund in Japan regarding to the policy to add asset value for income generation, in 2018, the Company sold two solar power projects in Japan with combined generating capacity of 4.02 MW(DC) and 12 MW(DC) respectively. This move was able to add asset value as we could immediately generate 214.5 million baht in profit. It can serve as another channel to make available cash flows for more and better opportunities for the Company and the shareholders to gain returns from investment in other profitable projects, and enable the Company to repay debts from previous investments, hence decrease in interest burden and business expansion flexibility.

As for 2019, the Company will still be committed to selecting what is best and most worthwhile for the shareholders. We will continue investing in solar power projects promoted by the Japanese government. Certain projects are under construction and ready for power supply in 2019 and several projects under development in Japan. Thus, potential investment in solar power projects in countries elsewhere is also considered. Another commitment is to devote our efforts to the upstream steel business to realize robust growth under strong support by the government sector. We have realigned our steel business strategy in various dimensions including rationalization and cost reduction of the manufacturing process to enhance competitiveness and remodeled our steel business operation to contracting service of steel manufacture to mitigate risk from global steel price fluctuations. In addition, the Company will keep seeking business and competitive opportunities and developing the business to keep up with the current situations to ensure ongoing organization development and fresh business opportunities which will bring benefits to all our shareholders.

Finally, we would like to thank our shareholders, customers, trade partners, patrons, business allies and employees for your untiring trust and support. It is our promise to conduct business with adherence to the objective of sustainability under efficient and transparent management and good corporate governance as well as with due consideration of all stakeholders and awareness of our mission to drive the Company toward the ultimate goal.