Company Performance for the year 2005

BackFeb 27, 2006

Translation
     
      RPC-HO-SET/ELICID-0007/06
     
      February 27th, 2006
     
      Subject  Company Performance for the year 2005
     
      To    President
              The Stock Exchange of Thailand
      
      Rayong Purifier Public Company Limited and its subsidiaries would
      like to clarify the 155 % or 87 Million Baht decrease in the Company s
      Net Profit after Tax in 2005 compared to 2004. The key factors that
      caused the decrease of Net Profit from 56 Million Baht in 2005
      (calculate from the company performance in 2005 deduct first 9
      months) to Net Loss 31 Million Baht in 2005 can be summarized as
      follows:-
     
      1. Stock Loss Value
      Due to the fluctuation situation of world oil price during 2004 to 2005,
      especially in 4Q05, product oil price has been sharply decline. It can
      be seen as the price of Gas Oil in Singapore market which decreased
      from $81/BBL at beginning of 4Q05 to $68/BBL at the end of period.
      Therefore, the company has 160 Million Baht of inventory Loss in
      4Q05. However, 89 Million Baht or 54% of Inventory loss is loss from
      keeping 54 Million Liter of legally reserved. Nevertheless, the
      company still gain from inventory over the period of 2005.
      
      2. Decrease in Marketing Margin
      As regard to the decline of world oil price in 4Q05, it causes the
      higher spread between crude oil price and product oil price, and also,
      the abrogation of the controlled diesel price policy is resulting to
      reduce in the local marketing margin, compared to the same period
      of 2004 which has smaller in pricing competition.
     
      3. Nang Nual Crude
      The company supplied crude oil Nang Nual in 4Q05, in order to
      increase the production capacity. Therefore, the company has
      opportunity to reduce the ratio of the direct fixed cost per production
      volume and also increase the refinery margin of the company.
      However, the sharply decrease of oil price in 4Q05 is resulting loss
      of inventory value to Nang Nual and its products.
     
      4. Changing of accounting books
      As regard to the merger, with SCT group and the transportation
      company, reduces consolidated Selling and Administration Cost and
      also changed the Transportation Cost to be recorded as Cost of
      Goods Sold. Therefore the company has 314 Million Baht of Selling
      and Administration in 2005, decrease 76 Million Baht or 19%
      compared to 390 Million Baht in 2004
       As a result, the company s net profit has decreased by 155% or 87
      Million Baht in 4Q05 compared to 4Q04.
     
     
      Please be so informed.
     
     
      Sincerely Yours,
     
     
     
      Mrs. Siraporn Krishnakan
      Assistant to  Managing Director