Message from The Board of Directors

2001 has been a year of repositioning for Padaeng Industry.

After having changed its shareholding structure by selling its newly subscribed shares to Umicore (formerly Union Minire) of Belgium, the company had been able, in 2000, to reduce substantially its long-term debt.

It has allowed, in 2001, the company to further strengthen its balance sheet. Early in the year, the company has completely restructured its long-term debt and converted it in local currency. This resulted in lower interest payments, a lower debt-equity ratio and a much better protection against the fluctuations of the currency exchange.

Having reinforced its financial structure, the company was able to look forward to its future.

The company first revisited its Mission Statement and decided to adopt the following:

“The mission of Padaeng is to produce zinc metal and promote its usage for the benefit of all stakeholders.”

It then proceeded to define the corporate commitment:

“Padaeng will be a low cost producer of high quality zinc, able to compete in its markets with world class producers, providing valued services to its customers and giving great importance to the environment.”

Still with a view to reinforce the future of your company, the Board of Directors has been striving to implement the principles of good governance. To that effect, it has made full usage of its two existing committees: the Strategic committee for review of the strategy proposed by the company and the Audit committee to control the implementation of its policies by the company. Moreover the board has decided to create two new committees in the near future (Remuneration and Nominating) to assist it in its mission.

In a year characterized by a very slow economy and a dismal condition of the zinc industry worldwide, it was particularly important to design the repositioning of the company carefully, even more as 2002 is expected to be as difficult. Therefore, the partnership with its main shareholder Umicore was essential.

Building on its own experience of handling simultaneously silicate ores and sulphide concentrates and on the expertise of Umicore, the company is investing to increase the versatility of its installations to process a wider variety of raw materials. This will be important in a period of tightening supply.

The partnership allows also the company to accelerate the implementation of its marketing strategy of selling a greater share of specialty products. By decreasing its dependence on the pure commodities market, the company will be able to better withstand the economic downturns.

The results of 2001, particularly in view of those of many of its competitors, show that Padaeng Industry is making the right choices for the future.

The Board of Directors wishes also to take this opportunity to thank all the employees of the company for their dedication, the shareholders for their confidence and the government agencies and our customers for their support throughout the year.



Mr. Andre R. van der Heyden
Managing Director

Mr. Pinit Vongmasa
Chief Executive Officer

Mr. Arsa Sarasin
Chairman


Copyright © 2000 Padaeng Industry Public Company Limited