Date : 12/05/2003 18:01 ADVANC : OPERATING RESULTS Q1/2003 -Translation- AIS 0118 / 2003 May 12, 2003 Subject: Submission of Reviewed Consolidated and Company Financial Statements for the First Quarter of Year 2003 and Clarification of the differences between net profit for the first quarter of 2003 and the first quarter of 2002 is over 20% To: President The Stock Exchange of Thailand Enclosure: 1. Reviewed consolidated and company financial statements for the first quarter of year 2003 in Thai and English version 2. Management and Discussion Analysis for the first quarter of year 2003 in Thai and English version Advanced Info Service Public Company Limited ("the Company") would like to submit the reviewed consolidated and company financial statements for the first quarter of 2003. In addition,the Company would like to clarify an increase net profit of baht 1,399 million or 43.61% from baht 3,208 million in the first quarter of 2002 to baht 4,607 million in the first quarter of 2003, as follows: 1. Revenue - Revenue from services and equipment rental The company and its subsidiaries recoded Baht 17,822 million of revenue from services and equipment rental in the first quarter 2003, increased by Baht 3,637 million or 25.6% when compared with those of the first quarter 2002. The result was notably due to larger customer bases, especially on pre-paid service. - Revenue from sales When compared with revenue as of the first quarter 2002, revenue from sales decreased by Baht 538 million or 10%. Mobile phone trading was more competitive in 2003 than the first quarter 2002 due mainly to due to unlock of phone ID (IMEI - International Mobile Equipment Identity) in the second quarter 2002. 2. Cost and Expense - Concession fee and excise tax During the first quarter in 2003, the Ministry of Finance announced the introduction of an excise tax for the telecommunication business, which has to pay excise tax at 10% of the mobile phone service income. As of the first quarter in 2003, the concession fee and excise tax increased by Baht 603 million or 16.4% because of an increase in service and equipment rental revenues. - Cost of services and equipment rental Cost of services and equipment rental was up Baht 1,752 million, or 58.2%. It increased to Baht 4,758 million from Baht 3,006 million in same period last year. This was mainly from 2 components; (1) The amortization of mobile phone networks was up Baht 985 million when compare to the first quarter of previous year. The company had invested more in mobile phone network to support its subscriber growth. Moreover, during the first quarter this year, the company changed an estimated useful life of Intelligence Network equipment from five to three years as.The result of the change in amortization period was an increase in amortization expense of Baht 249 million. (2) The cost of maintenance has increased Baht 225 million. - Costs of sales Costs of sales have decreased by Baht 217 million or 5.7%, from Baht 3,796 million to be Baht 3,580 million due to the lower in the unit cost of sales. - Selling and administrative expenses Selling and administrative expenses of the company and its subsidiaries were Baht 3,041 million, which decreased by Baht 125 million or 3.9% from those of the first quarter in previous year because of the following reasons: (1) An increase from write-off in mobile phone equipment of Baht 294 million. (2) A decrease in allowance for doubtful accounts by Baht 377 million. - Income tax As of the first quarter this year, the company and its subsidiaries recorded Baht 1,837 million in income tax. Compared to the first quarter in previous year, income tax decreased by 21.2% primarily due to utilization of loss carry forward of subsidiary. Please be informed accordingly. Yours sincerely, -Signed- Mrs. Siripen Sitasuwan Director Advanced Info Service Public Company Limited