Message from the Chairman

Dear Stakeholders,

On behalf of our Board of Directors, I would like to convey our discontent regarding the Company's financial performance, which incurred losses for the first time since transitioning to operate under the 'BTS Group' name. We also regret not being able to approve the dividend payment to shareholders, marking the first time this has happened since 2010.

Nevertheless, from my perspective, the Group conglomerate remains highly robust. However, due to adverse market dynamics and volatile business conditions, investments by our subsidiaries and associates in Kerry Express (Thailand) Co., Ltd. (KEX) and Singer Thailand PCL (SINGER) faced unforeseeable circumstances. Essentially, while these investments have previously enjoyed positive returns (in terms of improved business performance, increasing profit, share price appreciation as well as dividends), the rapidly changing market conditions and irrational competition beyond our control has resulted in their subsequent deterioration. Consequently, the relevant Boards of Directors made the difficult, but sensible decisions to sell the KEX and SINGER investments, limiting further damage.

In addition, we still maintain confidence from the strong performance and high growth potential of BTSC’s SkyTrain Business. I am hopeful that we will return to a position of strength and resume dividend payments in the near future.

Legal Disputes will Soon be Resolved, Onwards We Go

For the ongoing issue regarding outstanding debt from Krung Thep Thanakom Co., Ltd. (KT)¹, we must acknowledge that although KT and Bangkok Metropolitan Administration (BMA) settled the outstanding principal and contractual interest payments for the Electrical & Mechanical (E&M) development amounting to THB 23.3bn on 2 April 2024, it has previously caused us some financial hardship.

Regarding the outstanding debt for the Operations and Maintenance (O&M) of the Green Line Extension, I firmly believe that the validity of the Green Line Extension contract will soon be upheld. This is because in the past, KT and the BMA have a track record of paying their dues, both in full (up until April 2019) and partially (since May 2019). This payment record in itself, confirms that our contract for the operation of the Green Line Extension is legally enforceable in every aspect.

Furthermore, Bangkok Mass Transit System PCL (BTSC) took legal appropriate action to address the non-payment for the aforementioned O&M debt which has been met with favourable judgement in the lower courts. I believe that the forthcoming judgment from the Supreme Court, which is expected to be issued shortly, will resolve these debt matters favourably.

We resume from a Position of Strength

As of 31 March 2024, BTS Group has cash and liquid investments balance of THB 19.4bn, together with additional available bank credit lines. In addition, the repayment of the E&M debt on 2 April 2024 from KT and the BMA, expected repayment of THB 36.3bn² O&M debt as well as the subsidy payments of THB 4.8bn per annum for the Pink and Yellow Line contracts will strengthen BTS Group’s cash flow considerably.

And with Cause for Optimism

We have another 18 years remaining of contractual O&M income for the Green Line, and can procure further infrastructure contracts from a position of strength, given our extensive experience in managing the SkyTrain and our strong financial position. VGI is also expected to see the return to profitability of its core businesses. We will continue to evaluate growth opportunities across our MOVE, MIX and MATCH platform, with a greater awareness of the market cycle and the risks that it carries, but with optimism that we can generate attractive returns. In 2024, the Thai economic growth is expected to accelerate to 3.0%³, up from 1.9% in 2023. We are confident that the Government and its policies will steer Thailand to a better course. Nonetheless, we are ready to move forward with expanding our business related to infrastructure development, particularly in the mass transit system network. In the near future, Thailand will continue to require continuous rail system development and our mass transit business is at the forefront of this challenging endeavour.

As the World’s Most Sustainable Transport Company

As climate change accelerates and the pressure to reduce Greenhouse Gas emissions intensify, Governments around the world realise that any path to ‘Transport Net Zero’, must adopt an electric rail system (for both passenger and freight) as the backbone of any transportation system. We firmly believe this bodes well for the durability of our business model, and will bring tremendous expansion opportunity in the coming decades.

We are proud that our efforts have been recognised once again this year, having been ranked the most sustainable Transportation & Transportation Services Company in the world by Dow Jones Sustainability Index for the 4^th year running, a globally recognised standard.

2024/25 will see the next step in the evolution of our Sustainability Strategy as we now chart our course for Net Zero Emissions under the SBTi standard, which our Board of Directors approved in March 2024.

In conclusion, I extend my heartfelt thanks to our dedicated employees and valued stakeholders. Your unwavering perseverance has been instrumental in our ability to navigate difficult challenges, and will be key to seizing upcoming opportunities. The Company remains committed to developing the country's critical infrastructure for the sustainable growth of both the Company and Thailand moving forward.

¹ A limited company established and owned 99.98% by Bangkok Metropolitan Administration
² As of 31 March 2024
³ Information from Office of the National Economic and Social Development Council (NESDC) as of 20 May 2024