Bangkok Medical Center Bangkok Dusit Medical Services

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					                                  ANNUAL REPORT 2005




Bangkok Medical Center
      BANGKOK DUSIT MEDICAL SERVICES Public Company Limited
"Bangkok Medical Center is where advances
    in medicine meet with compassion"
                                                                         Contents
ë Message from the Board of Directors                                               2

ë Board of Directors' Profile                                                       4

ë Report of the Audit Committee                                                 10

ë General Information                                                           11

ë Juristic Persons in which the Company Holds 10% of Shares or Greater          12

ë Financial Overview                                                            15

ë Nature of Business                                                            18

ë Research and Development                                                      29

ë Industry Outlook and Competitions                                             31

ë Future Projects                                                               34

ë Risk Factors                                                                  38

ë Shareholders Structure and Management                                         41

ë Corporate Governance                                                          49

ë Transactions with Related Parties                                             54

ë Explanation and Analysis of Operational Results and Financial Status          57

ë Responsibility of the Board of Directors to the Financial Statements          59

ë Financial Statements and Auditor Report                                       62
 Message from
 the Board of
 Directors

  The Board of Directors is pleased to present our dear shareholders with the operational results of Bngkok
Dusit Medical Services Public Company Limited for 2005 as follows:

   All countries have been affected by the gradually rising oil prices and cost of living in 2005, more serious
natural disasters, political instability in many countries and new epidemics, resulting in stagnant and receding
businesses. Nevertheless, people continue to have illnesses while medical advancements are still being made.
People have become more concerned about their health and private hospitals need to keep themselves abreast
of new medical developments. They could not afford to remain idle as before. Hospitals need the latest medical
equipments which allow early diagnosis, expert clinicians in each tract for the diagnosis and the treatment of
diseases involvingall systems of the body. Bangkok Hospital Group is trusted by patients for this very reason.
We have a very well established medical credibility and we continue to improve the quality of our services and
upgrade existing safety and environmental standard achievements, partly to celebrate our 34th Anniversary
in 2006.

    The year 2005 has been a year of expansion for Bangkok Hospital Group. Firstly, Her Majesty Queen Sirikit
graciously presided over the grand opening ceremony of Bangkok Heart Hospital on Friday, the 26th of August
2005. Subsequently, the company has installed the Brilliance CT 64-Channel Configuration Equipment, the
latest medical innovation which allows unobtrusive inspection of cardiac vessel at Bangkok Heart Hospital.
It was the first to be installed in Thailand and South East Asia, in order to meet the demands and enhance
diagnosis efficiency.

    In addition, the company expanded the new service building "Bangkok Rehabilitation Center" since an
increase in the number of patients. Additionally, Wattanosoth Hospital or Bangkok Cancer Hospital has been
operating unofficially since late 2005. It is fully equipped with the most efficient medical equipments in Asia
Pacific such as IMRT, PET/CT and Cyclotron which make it possible to detect cancer at any part of the body
at an early stage plus radioactive therapy equipments and clinicians with expertise in the diagnosis and
treatment of cancers.

   As for regional services, Bangkok Trad Hospital Co., Ltd., the company's subsidiary, has launched "Koh Chang
International Clinic" on the 8th of December 2005. The clinic is an extension service of Bangkok Trad Hospital
providing medical services to Thai and foreign tourists as well as locals on Koh Chang.

   Furthermore, the company still has a new hospital project in Cambodia and also constructed a hospital for
expatriates called "Bangkok International Hospital" which will be ready for operation in early 2006. These
have in line with the government's policy of promoting Thailand as the Healthcare and Medical Hub of Asia
by expanding the client base to cover more in South East Asia and bring our medical service capability to
neighbouring countries.




2
   With regard to academic promotion efforts, the company organized the Fifth BGH Annual Academic Meeting
during Monday, the 7th to Wednesday, the 9th of March 2005 with statesman Prof. Kasem Wattanachai, M.D.,
chairing the opening ceremony. In addition, the Sixth BGH Congress on Critical Care for Nurse was organized
on Friday, the 10th of March 2006. The mentioned academic conferences were well received and attended by
numerous doctors, dentists, pharmacists, nurses, medical and public health personnel from public and private
hospitals as like the preceding years.

    Bangkok Hospital and Bangkok Heart Hospital have shown great interest in quality management and the
latest medical equipments, some of which were installed at Bangkok Hospital for the first time in Thailand.
A total of 1,250 practitioners from 52 medical institutions have visited us to view these devices so far.

   In late 2005, the Extraordinary General Meeting of shareholders No.1/2005 approved the company's
restructuring planning by acquisition shares from all shareholders of the eastern hospital group, which
comprised of Bangkok Pattaya Hospital Co., Ltd., Bangkok Trad Hospital Co., Ltd., Wattanavej Co., Ltd.
(Bangkok Chantaburi Hospital), and Bangkok Rayong Hospital Co., Ltd. in accordance with the business
expansion plan. The Board of Directors has believed that this acquisition will enhance the company's
competitiveness and further fortify our position in the medical service industry.

   Finally, the company would like to thank each of you, dear shareholders of Bangkok Hospital, for your
continued support. We are now a leading private hospital with great potentials to grow and capable of reaching
a broader range of patients. With the good deeds of yours in the treatment of financially distressed patients
through Vejchadusit Foundation under the Royal Patronage of HRH Princess Galyani Vadhana Krom Luang
Naradhiwas Rajanagarindra, you shall be graced with happiness and luck in all of your endeavours. May you
prosper and be in good health always.




                                                                                                           3
  Board
  of Director's
  Profile

                              Education                                               Other Position
                              ë Directors Accreditation Program Batch 45,             ë Assistant to Ministry of Public Health
                                  Thai Institute of Directors Association             ë Chairman, Centre for Continuing
                              ë   Facharzt fur Chirugie, The Medical Council of           Medical Education of Thailand
                                  Hamburg, German                                     ë President, Royal College of Surgeons
                              ë   Certificate of Medical Clinic, Mahidol University       of Thailand
                              ë   Medical Doctor, Faculty of                          ë Vice President, The Prince Mahidol
                                  Medicine Siriraj Hospital, Mahidol University           Award Foundation
                                                                                      ë Member of the      Thai medical
                              Experience                                                  registration license committee
                              ë Secretary General, Royal College of Surgeons          ë   Vice President, Siriraj Foundation
Professor                         of Thailand
Arun Pausawasdi, M.D.         ë   Chairman of Scientific Session Medical,             Percentage of shareholding
Chairman of                       The Medical Association of Thailand                 ë 0.03
the Board of Directors        ë   Dean, Faculty of Medicine Siriraj Hospital,
Age 67 years old                  Mahidol University                                  Relationship among other management
                              ë   Director of the Medical Association                 ë None


                              Education                                               Other Position
                              ë Directors Accreditation Program Batch 45,             ë President, Bangkok Airways Co., Ltd.
                                  Thai Institute of Directors Association
                              ë   Certificated from National Defense College          Percentage of shareholding
                              ë   Medical Doctor, Faculty of Medicine                 ë 12.8
                                  Siriraj Hospital, Mahidol University                Relationship among other management
                              Experience                                              ë None
                              ë Resident/Professor in Department of Surgery,
                                  Faculty of Medicine Siriraj Hospital
Prasert Prasarttong-Osoth,
M.D.                          ë Member of National Legislative
Vice Chairman/ Chairman of        Council (Senator)
CEO Committee
Age 72 years old



                              Education                                               Other Position
                              ë Directors Accreditation Program Batch 45,             ë None
                                  Thai Institute of Directors Association
                              ë   Certificate in Pediatric Surgery                    Percentage of shareholding
                              ë   Medical Doctor (Honour), Faculty of Medicine        ë 0.41
                                  Siriraj Hospital, Mahidol University
                                                                                      Relationship among other management
                              Experience                                              ë None
                              ë Head , Department of Surgery, Faculty of
                                  Medicine Siriraj Hospital, Mahidol University
Professor                     ë General Secretary, Department of Medicine,
Snoe Indrasukhsri, M.D.           Siriraj Hospital
Independent Director and      ë School Director, School of Therapist Rehabilitation
Chairman of Audit Committee
                              ë President, Medical Society of Private Practioner
Age 84 years old
                              ë Chairman, Pediatric Association


 4
                               Education                                                   Other Position
                               ë Directors Accreditation Program Batch 45,                 ë Vice President of Samitivej PLC.
                                   Thai Institute of Directors Association                 ë Chairman,
                               ë   Honorary Doctorate in Business Management,               Bangkok Helicopter Services Co.,Ltd.
                                   Christian University                                    ë Chairman,
                               ë   Certificate from National Defense College                Bangkok Phuket Hospital Co., Ltd.
                               ë   DTM & H Diploma, Faculty of Tropical Medicine           ë Chairman, B.D.M.S International
                                   and Hygiene, Mahidol University                          Medical Services Co., Ltd.
                               ë   Post Graduate Study, University of Pennsylvania, USA.   ë Chairman,
                               ë   Medical Doctor, Faculty of Medicine Siriraj Hospital,    S.R. Property Investment Co., Ltd.
                                   Mahidol University
                                                                                           Percentage of shareholding
Pongsak Viddayakorn,           Experience                                                  ë 5.22
M.D.                           ë Member of consultation committee of the Bangkok
President/ 1st Vice Chairman       Metropolitan Administration Governor (Healthcare)       Relationship among other management
of CEO committee               ë Director of the Medical Heath Care Centre of              ë None
Age 71 years old                   the Teacher Council of Thailand
                               ë   Chairman, Private Hospital Association
                               ë   Director of Medical Association



                               Education                                                   Other Position
                               ë Directors Accreditation Program Batch 45,                 ë Chairman,
                                   Thai Institute of Directors Association                  Bangkok Prapadaeng Hospital Co., Ltd.
                               ë   Diplomate of American Board of Surgery                  ë Director,
                               ë   Medical Doctor, Faculty of Medicine                      Bangkok Pattaya Hospital, Co., Ltd.
                                   Siriraj Hospital, Mahidol University
                                                                                           Percentage of shareholding
                               Experience                                                  ë 2.31
                               ë Head, Surgical Unit, National Cancer Institute
                               ë Hospital Director, Karuna Pitak Hospital                  Relationship among other management
Chuladej Yossundharakul,                                                                   ë None
M.D.                           ë Hospital Director, Bangkok Hospital
Director/ 2nd Vice Chairman
of CEO Committee
Age 73 years old



                               Education                                                   Other Position
                               ë Directors Accreditation Program Batch 45,                 ë Chairman,
                                   Thai Institute of Directors Association                  Bangkok Pattaya Hospital Co., Ltd
                               ë   Diplomate of American Board of Radiology,               ë Director,
                                   Downstate University of New York                         Bangkok Phuket Hospital Co., Ltd.
                               ë   Graduated Course Radiobiology at M.D.
                                   Anderson Hospital, Houston, Texas                       Percentage of shareholding
                               ë   Medical Doctor, Faculty of Medicine                     ë 3.18
                                   Siriraj Hospital, Mahidol University                    Relationship among other management
Chirotchana Suchato,           Experience                                                  ë None
M.D.                           ë School Director, School of X-Tray Technician
Director/                      ë Professor of Radiology division,
Member of CEO Committee
                                   Faculty of Medicine, Ramathibodi Hospital
Age 69 years old
                               ë Consultant to Radiology,
                                   Clinic of The Teacher Council of Thailand


                                                                                                                                 5
 Board
 of Director's
 Profile

                           Education
                           ë Directors Accreditation Program Batch 44,                 ë Chairman of Executive committee,
                               Thai Institute of Directors Association                  Bangkok Rayong Hospital Co., Ltd.
                           ë   Stanford Executive Program Graduate School              ë Chairman of Executive committee,
                               of Business, Stanford University                         Wattanavej Co., Ltd.
                           ë   Resident Training Program (Internal Medicine)           ë Chairman of Executive committee,
                               Siriraj Hospital                                         Bangkok Trat Hospital Co.,Ltd.
                           ë   Medical Doctor, Faculty of                              ë Consultation Director,
                               Medicine Siriraj Hospital, Mahidol University            Medical Association of Thailand
                                                                                       ë Consultation Director, Siriraj Medical
                           Experience                                                   Alumni Association under Royal Patronage
                           ë Hospital Director, Bangkok Hospital                       ë Consultation Director, Thailand Hospital
Yingdao Krairiksh, M.D.    ë Managing Director,                                         Administrator Association
Director/ Member of            Bangkok Prapadaeng Hospital Co., Ltd.
CEO committee                                                                          Percentage of shareholding
Age 54 years old
                           Other Position                                              ë 0.22
                           ë Chairman of Executive committee,
                               Bangkok Samui Hospital Co., Ltd                         Relationship among other management
                           ë Chairman of Executive committee,                          ë None
                               Bangkok Pattaya Hospital Co., Ltd.



                           Education                                                   Other Position
                           ë Directors Accreditation Program Batch 43,                 ë Chairman,
                               Thai Institute of Directors Association                  The Medic Pharma Co., Ltd.
                           ë   Ph.D. (Tropical Medicine),
                               Liverpool University                                    Percentage of shareholding
                           ë   Medical Doctor, Faculty of Medicine                     ë 0.15
                               Siriraj Hospital, Mahidol University                    Relationship among other management
                           Experience                                                  ë None
                           ë Vice President for Administration,
Professor                      Mahidol University
Santasiri Sornmani, M.D.
Independent Director/
                           ë Dean, Faculty of Tropical Medicine,
Audit Committee                Mahidol University
Age 72 years old           ë Member, Expert Committee on
                               Food Borne Parasitic Diseases, WHO




                           Education                                                   Other Position
                           ë Directors Accreditation Program Batch 14,                 ë Director,
                               Thai Institute of Directors Association                  Syn Mun Kong Insurance PLC.
                           ë   Certificate, National Defense College                   ë Director,
                           ë   Certified Public Accountant                              Bangkok Prapadaeng Hospital Co., Ltd.
                           ë   Bachelor of Accounting, Chulalongkorn University
                                                                                       Percentage of shareholding
                           Experience                                                  ë 0.01
                           ë Senior Executive General Manager,
                               Thai Military Bank PLC.                                 Relationship among other management
Mr. Anuchat Chaiprapa                                                                  ë None
Independent Director/      ë   Director, Nava Finance & Securities PLC
Audit Committee            ë   Director, Paiboon Insurance Co., Ltd.
Age 73 years old           ë   Director, Small Business Credit Guarantee Corporation


 6
                             Education
                             ë The Role of the Chairman, Batch 9,               ë Director, Bangkok Pattaya Hospital Co., Ltd.
                                 Thai Institute of Directors Association        ë Director, Bangkok Phuket Hospital Co., Ltd.
                             ë   Directors Certification Program Batch 20,      ë Director, Samitivej PLC.
                                 Thai Institute of Directors Association        ë Director, BNH Medical Centre Co., Ltd.
                             ë   Senior Executive Program, Sasin Graduate       ë Director, National Healthcare Systems Co., Ltd.
                                 Institute of Business Administration           ë Director, Bio Molecular Laboratory
                             ë   MBA - Accounting, Roosevelt University, USA.       (Thailand) Co., Ltd.
                                                                                ë Director, Bangkok Helicopter Services Co., Ltd.
                             Experience                                         ë Director, First Health Food Co., Ltd.
                             ë Managing Director,                               ë Director, Sodexho Support Services (Th) Co., Ltd.
                                 Thai Wah Resorts Development Co., Ltd.         ë Director, B.D.M.S. International Medical
Wallop Adhikomprapa          ë Managing Director, Thai Wah Plaza Co., Ltd.          Services Co., Ltd.
Director/ Member of          ë Financial Controller, Holiday Inn Crown Plaza    ë Director, S.R. Property Investment., Ltd.
CEO Committee                ë Assistant Director - Accounting and Finance,
Vice President -Accounting       Hostmark Hospitality Group                     Percentage of shareholding
& Finance                                                                       ë 1.46
Age 62 years old             Other Position
                             ë Chairman, Bangkok Rayong Hospital Co., Ltd.      Relationship among other management
                                                                                ë None

                             Experience
                             ë Diplomate American Board of Surgery              ë Cardiac Surgeon,
                             ë Diplomate American Board of Thoracic Surgery         Minneapolis Heart Institute - Abbott
                             ë Ph.D. (Surgery) University of Minnesota,             Northwestern Hospital, Minnesota, USA
                                 Graduate School, Minneapolis, Minnesota, USA   ë   Chief Heart Surgeon,
                             ë Residency Training, University of Minnesota,         John Nasseff Heart Hospital, USA
                                 School of Medicine, USA
                             ë Internship, University of Kentucky               Other Position
                                 Medical Center, USA                            ë Head, Heart Institute Samitivej - Sukhumvit
                                 Medical Doctor, Faculty of Medicine            ë President, Heart Association of Thailand
Kittipan Visudharom,         ë
M.D                              Siriraj Hospital, Mahidol University           Percentage of shareholding
Director/ Member of                                                             ë 0.27
CEO Committee/               Experience
Vice Hospital Director of    ë Cardiac Surgeon, Minessotta Hospital, USA        Relationship among other management
Bangkok Heart Hospital       ë Associate Professor,                             ë None
Age 67 years old                 Department of Surgery, Uthsesa, USA


                             Education                                          Other Position
                             ë Directors Certification Program Batch 27,        ë Director,
                                 Thai Institute of Directors Association            Bangkok Helicopter Services Co., Ltd.
                             ë   Bachelor of Law, Thammasart University         ë Managing Director,
                                                                                    Thai Petroleum Service Co., Ltd.
                             Experience                                         ë Director, Executive Vice President of
                             ë Managing Director                                    Finance, Bangkok Airways Co., Ltd.
                               Air Lanka Catering Service Co., Ltd.
                             ë Director and Manager                             Percentage of shareholding
Thavatwong Thanasumitra        Thai Petroleum Service Co., Ltd.                 ë 0.18
Director
                                                                                Relationship among other management
Age 58 years old
                                                                                ë None


                                                                                                                          7
 Board
 of Director's
 Profile

                            Education
                            ë Directors Certification Program Batch 23,               ë Director and Chairman of Executive
                                Thai Institute of Directors Association                 committee, BNH Medical Centre Co., Ltd.
                            ë   Post Graduate Studies in Health Administration,       ë Director and Chairman of Executive
                                Loma Linda University, CA, U.S.A.                       committee, the Medic Pharma Co., Ltd.
                            ë   MPH (International Health),                           ë Director, Bangkok Pattaya Hospital Co., Ltd.
                                Loma Linda University, CA, U.S.A.                     ë Director, National Healthcare Systems Co., Ltd.
                            ë   BA, MA (Philosophy & Counseling),                     ë Director, Bio Molecular
                                Philippine Adventist University, The Philippines        Laboratory (Thailand) Co., Ltd.
                                                                                      ë Director, First Health Food Co., Ltd.
                            Experience                                                ë Director, Sodexho Healthcare
                            ë Chief Executive Officer, Gleneagles                       Support Services (Th) Co., Ltd.
Mr. Lee Khoe Soa                Oncology Center, Kuala Lumpur                         ë Director, Sodexho Support Services (Th)
Member of CEO Committee     ë   Company Director,                                       Co., Ltd.
Age 61 years old                Gleneagles Oncology Center, Kuala Lumpur
                                                                                      Percentage of shareholding
                            Other Position                                            ë 0.04
                            ë Managing Director, CEO & Chairman of
                                Executive Committee, Samitivej PLC.                   Relationship among other management
                            ë Managing Director & Chairman of Executive               ë None
                                Committee, Samitivej Sriracha Hospital Co., Ltd.

                            Education
                            ë Certified of National Defense College                   ë Physician Executive, Jameson Health System,
                            ë Fellow, American College of Medical Quality               New Castle, Pennsylvania, USA
                            ë Certified, American Board of Quality Assurance &        ë Training courses in QA/ UR/ RM. American Board of
                              Utilization Review Physicians                             Quality Assurance & Utilization Review Physicians, USA
                            ë Fellow, American Academy of Pediatrics
                            ë Certified, American Board of Pediatrics                 Other Position
                            ë Medical Doctor, Chulalongkorn University                ë Chairman of Executive Committee,
                                                                                        Bangkok Prapradaeng Hospital Co., Ltd.
                            Experience                                                ë Chairman of Executive Committee,
                            ë Group Chief Medical Officer,                              Bangkok Had Yai Hospital Co., Ltd.
                                Bumrungrad Hospital, Bangkok                          ë Chairman of Executive Committee,
                            ë Chief Executive Administrator, Bangkok Hospital,          Bangkok Phuket Hospital Co., Ltd.
Chatree Duangnet, M.D.      ë Clinical Assistant Professor of Pediatrics,             ë Director, B.D.M.S International Medical Services Co., Ltd.
Member of CEO Committee/        College of Medicine, Pennsylvania State University,
Chief Operating Officer         Pennsylvania, USA                                     Percentage of shareholding
                            ë   Chairman of the Board, Jameson Physician Hospital     ë0
Age 61 years old                Organization, New Castle, Pennsylvania, USA
                            ë   President, Lawrence Independent Physician             Relationship among other management
                                Association, Lawrence County, Pennsylvania, USA       ë None

                            Education                                                 Other Position
                            ë Director Certification Program Batch 22,                ë Managing Director,
                              Thai Institute of Directors Association                   Bangkok Pattaya Hospital Co., Ltd.
                            ë Advanced Management, Wharton's                          ë Managing Director, BNH Medical Centre Co., Ltd.
                              Business School, University of Pennsylvania             ë Director, Bangkok Rayong Hospital Co., Ltd.
                            ë Dermatologist, Medical School,                          ë Director, National Healthcare Systems Co., Ltd.
                              Chulalongkorn University                                ë Director, Bio Molecular
                            ë Medical Doctor, Faculty of Medicine,                      Laboratory (Thailand) Co., Ltd.
                              Chulalongkorn University
                                                                                      Percentage of shareholding
Krittavith Lertutsahakul,   Experience                                                ë 0.04
M.D.                        ë Hospital Director, Samitivej Hospital
Member of CEO Committee                                                               Relationship among other management
Age 48 years old                                                                      ë None


 8
                               Education                                                 Other Position
                               ë Stanford Executive Program,                             ë Managing director, Cool & Joy Co., Ltd.
                                   Stanford Graduate School of Business (U.S.A.)         ë Director, The Medic Pharma Co., Ltd
                               ë   MBA, Lehigh University of Virginia, USA               ë Member of the Academy of Standard
                               ë   Bachelor of Economics,                                    Committee, Dept. of Marketing &
                                   University of West Virginia, USA                          General Management, Faculty of Business
                               ë   Bachelor of Business Administration                       Administration, Thammasat University.
                                   Major Marketing (Honour),                             ë   Committee & Secretary, Vej Dusit Foundation
                                   Thammasat University                                      under the Royal Patronage of H.R.H
                                                                                             Princess Galyani Vadhana Krom Luang
                               Experience                                                    Naradhiwas Rajanagarindra
Associate Professor            ë Associate consultant to Minister of
Ajjima Srethaputr                                                                        ë   Director, Institute for small and medium
                                   Public Health                                             enterprise Development
Member of CEO Committee/       ë   Instructor, The Journal of Business
Assistant to Chairman of           Administration, Faculty of Commerce &                 Percentage of shareholding
CEO Committee/
                                   Accountancy - Thammasat University                    ë0
Vice President - Marketing &
Business Development                                                                     Relationship among other management
Age 55 years old                                                                         ë None

                               Education                                                 Other Position
                               ë Certificate in Advanced Management,                     ë Director, Bangkok Pattaya Hospital Co., Ltd.
                                   Harvard Business School                               ë Director, Bangkok Samui Hospital Co., Ltd.
                               ë Diplomat Board of Clinical Preventive                   ë Director, National Healthcare
                                   Medicine (Thailand Medical Council)                       Systems Co., Ltd.
                               ë Certificate in Health Economics,                        ë Director, Bio Molecular
                                   Mahidol University                                        Laboratory (Thailand) Co., Ltd.
                               ë   Doctor of Medicine, Mahidol University -
                                                                                         Percentage of shareholding
                                   Ramathibodi Faculty of Medicine
                                                                                         ë 0.06
                               Experience
Pichit Kangwolkij, M.D.                                                                  Relationship among other management
                               ë Managing Director, Wattanvej, Co., Ltd.
Member of CEO Committee,       ë Managing Director,                                      ë None
Hospital Director of               Bangkok Rayong Hospital Co., Ltd.
Bangkok Hospital               ë Managing Director, Bangkok Trat Hospital Co., Ltd.
Age 44 years old               ë Hospital Director, Bangkok Pattaya Hospital Co., Ltd.


                               Education                                                 Other Position
                               ë Certificate in Advanced Management,                     ë Managing Director,
                                   Harvard Business School                                   Bangkok Phuket Hospital Co., Ltd.
                               ë   Board of Internal Medicine,                           ë Director, Bangkok Samui Hospital Co., Ltd.
                                   Chulalongkorn University
                               ë   Doctor of Medicine, Sonklanagarind University         Percentage of shareholding
                                                                                         ë 0.002
                               Experience
                               ë Hospital Director,                                      Relationship among other management
                                   Bangkok Phuket Hospital, Co., Ltd.                    ë None
Suraphong
Lookhanumanjao, M.D.           ë   Hospital Director, Yaring Hospital
Hospital Director of           ë   Head of Dialysis Unit,
Wattanosoth Hospital               The Vachira Phuket Hospital
Age 45 years old


                                                                                                                                 9
 Report
 of the Audit
 Committee




   The Board of Directors of Bangkok Dusit Medical Services Public Company Limited has appointed an
Audit Committee comprising of three independent members; Prof. Snoe Indrasukhsri, M.D., as the chairman,
Prof. Santasiri Sornmani, M.D., and Mr. Anuchat Chaiprapa, as members.

   The Audit Committee is entrusted with the duties of giving credibility to the financial statements prior to
submission to the Board of Directors, ensuring efficient internal control with respects to financial statements
and compliance with relevant regulations and laws, preventing conflict of interests, providing risk management
advices, promoting the observance of good practices of listed company and nominating auditors.

   The Audit Committee has had twelve meetings with the auditors and the management in 2005 to review
financial statements, assess internal control measures, review compliance with regulations and laws as well as
the auditing practices of the auditor for 2005. It is the opinion of the Audit Committee that the consolidated
financial statements of the company and its subsidiaries is correct in significant details as per the generally
certified accounting standard and that the disclosure of information is adequate.

   The Audit Committee shall nominate the auditors for 2006 to the Board of Directors for further submission
to and the approval from the shareholders' meeting.




10
 General
 Information


General Information
     Type of business              Health Care Business

     Location                      2 Soi Soonvijai 7, New Petchaburi Road,
                                   Huay Khwang, Bangkok 10310
                                   Tel: 02-318-0066, 02-310-3000
                                   Fax: 02-318-1546, 02-310-3327

     Company registration number   Bor.Mor.Jor. 249

     Web site                      www.bangkokhospital.com

     Registered capital            Baht 1,183.41 million of which is paid up and issued at
                                   Baht 1,163.41 million with par value of Baht 1 each


Reference information
     Security registrar            Thailand Securities Depositor Co., Ltd.
                                   4th Floor, Stock Exchange of Thailand Building,
                                   62 Ratchadapisek Road, Klong Toey, Bangkok 10110
                                   Tel: 02-229-2800, 02-654-5599
                                   Fax: 0-2359-1259

     Auditor                       Ernst & Young Office Company Limited
                                   Mr. Ruth Chaowanagawi
                                   Mrs. Saifon Inkaew
                                   Ms. Ratana Jala
                                   33rd Floor, Lake Rajada Office Complex,
                                   193/136-137 Ratchadapisek Road, Klong Toey,
                                   Bangkok 10110
                                   Tel: 02-264-0777
                                   Fax: 02-264-0789-90

     Legal consultant              Punyariddhi Law Office
                                   Apichai Chandrasane, Ph.D.
                                   22 Soi Soontornsaratoon (Onnut 21/1)
                                   Sukhumvit 77 Road, Bangkok 10250
                                   Tel: 02-760-6969-76
                                   Fax: 02-760-6967-68


                                                                                             11
 Juristic persons
 in which the
 company holds
 10% of shares
 or greater

(as of the 31st of December 2005)

                                                                                                               Number     Number of    %
                                        Date of                                                                           shares held
            Name                                                   Location          Type of business       of issued and   by the    Share
                                      registration                                                         paid-up shares company holding


B.D.M.S. International              20 December 2005    61A Street 214,                   100-bed               1,000             1,000   100.0
Medical Services Co., Ltd.                              Sangkat Beong Rang ,          private hospital       Par : KHR
                                                        Phnom Penh, Cambodia                               9,200,000/share
Bangkok Helicopter                      29 June 1995    1111 Ploenchit Rd.,          Medical Evacuation       3,000,000       2,999,992   100.0
Services Co., Ltd.                                      Pathumwan, Bangkok                                    Par : Baht
                                                                                                              10/share
Bangkok Samui                         14 August 2003    57 Moo 3, Amphur                  50-bed             15,000,000      14,999,993   100.0
Hospital Co., Ltd.                                      Kaosamui, Suratthani          private hospital        Par : Baht
                                                                                                              10/share
New Petchburi Medical               20 December 2002    2 Soi Soonvijai 7,                                     10,000             9,993   100.0
Services Co., Ltd.                                      New Petchburi Rd.,                                    Par : Baht
                                                        Huaykwang, Bangkok                                    100/share
Bangkok Phuket Co., Ltd.               15 March 1994    2/1 Hongyok-utit Rd.,             150-bed            100,000,000     99,467,500    99.5
                                                        Amphur Muang, Phuket          private hospital        Par : Baht
                                                                                                               5/share
Bangkok Hatyai                           27 July 1995   75 Soi 15 Petchkasem Rd.,         400-bed            100,000,000     98,533,300    98.5
Hospital Co., Ltd.                                      Hadyai, Sohgkhla              private hospital        Par : Baht
                                                                                                               5/share
Bio Molecular Laboratory            7 November 2001     2 Soi Soonvijai 7,             Biomolecular           1,000,000        949,993     95.0
(Thailand) Co., Ltd.                                    New Petchburi Rd.,               laboratory           Par : Baht
                                                        Huaykwang, Bangkok                                    10/share
Samitivej Public                    28 December 1976    133 Sukhumvit 49,             Private hospitals      100,000,000     92,919,772    92.9
Company Limited                                         Klongton, Wattana, Bangkok       • Samitivej          Par : Baht
                                                                                     Sukhumvit Hospital       10/share
                                                                                         (275 beds)
                                                                                         • Samitivej
                                                                                        Srinakarindra
                                                                                     Hospital (400 beds)
BNH Medical                           27 August 1991    9/1 Convent Rd., Silom,           225-bed            58,611,935      51,326,179    87.6
Centre Co., Ltd.                                        Bangrak, Bangkok              private hospital        Par : Baht
                                                                                                              10/share
Bangkok Rayong                           13 July 2002   8 Moo 2,                          200-bed            40,000,000      32,399,993    81.0
Hospital Co., Ltd.                                      Soi Sangchanneramit,          private hospital        Par : Baht
                                                        Amphur Muang, Rayong                                  10/share
Bangkok Prapadang                   7 September 1992    288 Suksawasdi,                   145-bed            10,500,000       8,295,000    79.0
Hospital Co., Ltd.                                      Amphur Muang,                 private hospital        Par : Baht
                                                        Samutprakarn                                          10/share




12
(as of the 31st of December 2005)

                                                                                                                Number     Number of    %
                                        Date of                                                                            shares held
            Name                                                   Location           Type of business       of issued and   by the    Share
                                      registration                                                          paid-up shares company holding


National Healthcare                       25 July 2001   2 Soi Soonvijai 7,           Medical laboratory     7,500,000      5,551,793   74.0
Systems Co., Ltd.                                        New Petchburi Rd.,                                  Par : Baht
                                                         Huaykwang, Bangkok                                   10/share
Bangkok Trad                          25 January 1994    276 Sukhumvit Rd.,                150-bed           40,000,000    25,341,034   63.4
Hospital Co., Ltd.                                       Amphur Muang, Trad             private hospital     Par : Baht
                                                                                                              5/share
Wattanavej Co., Ltd.                  28 October 1983    25/14 Taluang Rd.,                200-bed           18,000,000    11,158,324   62.0
                                                         Amphur Muang, Chantaburi       private hospital     Par : Baht
                                                                                                              10/share
S.R. Property                       20 December 2005     571 Road No. 6,                Land Holding           1,000             490    49.0
Investment Co., Ltd.                                     Phum Salakanseng,                Company            Par : KHR
                                                         Siem Reap, Cambodia                                20,000/share
Medical Pharma Co., Ltd.               26 August 1971    124 Thonburi-Pakthor Rd.,    Sale and production    2,143,000      1,050,000   49.0
                                                         Bangkok                        of medications       Par : Baht
                                                                                                              10/share
Bangkok Pattaya                           1 May 1989     301 Sukhumvit K.M.143 Rd.,        200-bed           28,000,000    13,720,000   49.0
Hospital Co., Ltd.                                       Amphur Muang, Chonburi         private hospital     Par : Baht
                                                                                                              10/share
Cool & Joy Co., Ltd.                    20 May 2003      2 Soi Soonvijai 7,           Public Relationship    5,000,000      1,500,000   30.0
                                                         New Petchburi Rd.,             and Marketing        Par : Baht
                                                         Huaykwang, Bangkok                                  10/share
Ramkhamhang                            25 August 1986    2138 Ramkhamhang,                 300-bed           12,000,000     2,280,000   19.0
Hospital Public Company Limited                          Bangkapi, Bangkok              private hospital     Par : Baht
                                                                                                              10/share
Udon Pattana Co., Ltd.                    9 June 1994    555/5 Phosri Rd.,                 350-bed           30,000,000     3,000,000   10.0
                                                         Amphur Muang, Udornthani       private hospital     Par : Baht
                                                                                                              10/share




                                                                                                                                         13
Juristic persons
in which the
company holds
10% of shares
or greater




         BSH                                 BNH                             BPH                               RAM
        100%                                87.57%                           49%                               19%

 BDMS International                          BRH                             MP                             Udon Pattana
      100%                                   81%                             49%                                10%

                                                                     S.R. Property
Bangkok Helicopter                           BPD                      Investment
      100%                                   79%                          49%

       NPMS                                  NHS                       Cool & Joy
       99.93%                               74.02%                       30%

        BPK                                  BTH
       99.50%                               63.35%

        BHH                                  BCH
       98.50%                               61.99%

         BIO
         95%

        SVH
       92.90%
SVH                  Samitivej Public Company Limited        BRH                   Bangkok Rayong Hospital Co., Ltd.
BPK                  Bangkok Phuket Co., Ltd.                BPD                   Bangkok Prapadang Hospital Co., Ltd.
BHH                  Bangkok Hatyai Hospital Co., Ltd.       NHS                   National Healthcare Systems Co., Ltd.
BIO                  Bio Molecular Laboratory                BTH                   Bangkok Trad Hospital Co., Ltd.
                     (Thailand) Co., Ltd.                    BCH                   Wattanavej Co., Ltd.
NPMS                 New Petchburi Medical                   BPH                   Bangkok Pattaya Hospital Co., Ltd.
                     Services Co., Ltd.                      MP                    Medical Pharma Co., Ltd.
BSH                  Bangkok Samui Hospital Co., Ltd.        S.R. Property         S.R.PROPERTY INVESTMENT
BDMS International   B.D.M.S. International Medical                                COMPANY LIMITED
                     Services Co., Ltd.                      Cool & Joy            Cool & Joy Co., Ltd.
Bangkok Helicopter   Bangkok Helicopter Services Co., Ltd.   RAM                   Ramkhamhang Hospital Public Co., Ltd.
BNH                  BNH Medical Centre Co., Ltd.            Udon Pattana          Udon Pattana Co., Ltd.



14
  Financial
  Overview

Operational Results                                                                                        (Unit : Million Baht)


                                              The Company and Subsidiaries                       The Company Only
                                          2005         2004         2003            2005            2004            2003
Total Revenues                              10,724        5,635       3,314            4,696          3,899             2,957
Revenue from Patient Services               10,254        5,274       3,085            4,243          3,679              2745
Gross Profit                                 4,319        2,275       1,223            1,878          1,634             1,097
EBITDA                                       1,865        1,102         578                955          889               539
Net Profit                                       832       623          385                832          623               385


EPS (Baht)                                    0.72         0.71         0.51            0.72           0.71              0.51
Weighted Average Shares                1,163,410,108 875,129,812 750,000,000     1,163,410,108 875,129,812 750,000,000




Financial status                                                                                           (Unit : Million Baht)

Total Assets                                17,677       14,598       7,305           11,664         10,142             6,173
Total Liabilities                            9,260        6,711       3,579            3,775          2,616             2,789
Minority Interest                                528       362          341                  0              0                0
Shareholders' Equity                         8,418        7,887       3,725            7,890          7,525             3,384




Financial Ratio
Current Ratio (times)                         0.51         0.92         0.70            0.38           1.33              0.89
Quick Ratio (times)                           0.45         0.86         0.66            0.33           1.28              0.86
Days Receivable (day)                             18          22           18               17             15               15
Days Inventory (day)                               8          10             8               8              6                6


Debt to Equity Ratio (times)                  1.10         0.85         0.96            0.48           0.35              0.82
Interest Coverage Ratio (times)               8.18        12.84         9.84           10.34          15.30              8.01


Patient Services Revenue Growth Rate        94.4%        71.0%        31.6%           15.3%          34.0%             24.8%
Net Profit Growth Rate                      33.5%        62.1%        25.7%           33.5%          62.1%             25.7%
Gross Profit Margin                         42.1%        43.1%        39.7%           44.3%          44.4%             40.0%
EBITDA Margin                               18.2%        16.4%        18.7%           22.5%         23.98%           19.64%
Net Profit Margin                            8.1%        11.8%        12.5%           19.6%          16.9%             14.0%
Return on Equity                            10.5%         8.3%        11.4%           10.5%            8.3%            11.4%


Assets Growth Rate                          21.1%        99.8%        27.4%           15.0%          64.3%              9.0%
Return on Assets                             4.7%         4.3%         5.3%            7.1%            6.1%             6.2%
Assets Turnover (times)                       0.61         0.39         0.45            0.40           0.38              0.48



                                                                                                                        15
BANGKOK
HEART
HOSPITAL
                                                                                  BANGKOK MEDICAL CENTER




The grand opening ceremony MR.Adulkit Kitiyakara Minimally Invasive and Robotic Heart Center of which was
presided over by Her Majesty Queen Sirikit on Friday, the 26th of August 2005. This is the first private heart
hospital in Thailand.
Nature of
Business

            1. Background

                Bangkok Dusit Medical Services Public Company Limited was established
            on the 30th of October 1969 as “Bangkok Dusit Medical Services Co., Ltd.”
            with an initial registered capital of Baht 10 million with the objectives of
            engaging in a private hospital business called “Bangkok Hospital”. The
            operation officially commenced on the 26th of February 1972. Throughout
            the thirty-three years of its operation, the company has gradually expanded
            to the extent where it could become registered in the Stock Exchange of
            Thailand on the 2nd of October 1991 and registered its conversion to limited
            public company in 1994 with gradually increasing registered capital. The
            company key business milestones are as follows:

            2001
                • Hospital Accreditation (HA) by Hospital Standard Certification and
            Development Institution, Ministry of Public Health
                • Prime Minister’s Export Award: Best Service Provider by Department
            of Export Promotion, Ministry of Commerce, on the 20th of August 2001.
                • Register of the change in paid up capital from Baht 356.25 million to
            Baht. 500 million

            2002
               • The Asian Hospital Management Awards for Marketing PR or Brand
            Management Project and Quality Management Program out of the ten prizes.
            The awards were presented by International Hospital Association, John
            Hopkins International Institute, Summa Foundation and Thai Private
            Hospital Association.
               • Register of the change in paid up capital from Baht 500 million to
            Baht 750 million.

            2003
               • ISO 14001 certification, MorOrGor. 18001/ OHSAS 18001 for environmental
            management standard, and, occupational hygiene and safety management
            standard certification by the Industrial Standard Organization.
               • Bangkok Hospital was pronounced by Superbrands as the preferred
            hospital of consumers and one of the only two hospitals in Thailand




18
remembered by consumers for positive reputation and medical service
excellence.

2004
    • ISO 14001 certification for environmental management, Mor Or Gor
18001/ OHSAS 18001 and occupational hygiene and safety management
standard certification by Japan Audit and Certification (JACO).
    • Register of the change in paid up capital from Baht 750 million to
Baht 1,000 million. Including register of the change of par value from Baht
10 to Baht 1 per share.
    • The company has made a tender offer for all shares in Samitivej Public
Company Limited, Bangkok Hadyai Hospital Co., Ltd. and Bangkok Phuket
Hospital Co., Ltd. and issued the new ordinary shares as the share price
payment to those shareholders. Following the completion of the said acquisition,
the shareholdings in the three companies are 92.9%, 98.5% and 99.5% of their
issued and paid up capital, respectively. The company has registered the
change of paid up capital from Baht 1,000 million to Baht 1,163.41 million
as well.

2. Important events in 2005

Officially Launch of Bangkok Heart Hospital and M.R. Adulkit Kitiyakara
Minimally Invasive and Robotic Heart Center
    The company has officially launched Bangkok Heart Hospital and
M.R. Adulkit Kitiyakara Minimally Invasive and Robotic Heart Center. The
grand opening ceremony of which was presided over by Her Majesty Queen
Sirikit on Friday, the 26th of August 2005. During the ceremony, Her Majesty
also marked and blessed the plaque naming the M.R. Adulkit Kitiyakara
Minimally Invasive & Robotic Heart Center.

Bangkok Heart Hospital is the first private heart hospital in Thailand which
features three key readiness factors as follows :
    1) Expertise of medical personnel in all tracts
    2) Advanced technology such as the first Da Vinci heart surgery assisting
robot in Thailand, cardiac MRI, cardiac CT scanner and mobile CCU.
    3) Cardiac rehabilitation and enhancement of international standard
for utmost satisfaction of the clients and a step towards medical excellence.




                                                                                   19
WATTANOSOTH
HOSPITAL
                                                                           BANGKOK MEDICAL CENTER




Her Royal Highness Princess Maha Chakri Sirindhorn gives the name Wattanosoth, which means Progressive
Medicine in Thai. This is the first private cancer hospital in Thailand.
     Launch of Wattanosoth Hospital (Bangkok Cancer Hospital)
        Wattanosoth Hospital has been operating unofficially since late 2005 in
     order to treat cancer patients. The name Wattanosoth, which means Progressive
     Medicine in Thai, was given by Her Royal Highness Princess Maha Chakri
     Sirindhorn.

        This is the first private cancer hospital in Thailand complete with
     advanced medical technology and clinicians specialized in the diagnosis and
     treatment of all cancers. Some of the featured equipment are:

        • PET/CT (Positron Emulsion Tormography/ Computed Tomography)
     PET/CT is a major advance in imaging technology and patient care. The
     Wattanosoth PET/CT scanner (GEMINI, Philips) is the first to be installed
     for medical services in Thailand. It is a functional imaging technology using
     radioisotopes. The medical applications of PET primarily include early
     detection of cancers of various organs, assessment of heart muscle viability
     in heart diseases and evaluation of functional brain anatomy in dementia,
     epilepsy and stroke.

        • Cyclotron A radioactive pharmaceuticals producing equipment for
     use with PET/CT in the detection of cancer. Most advanced and efficient,
     this equipment is adopted by several cancer institutes in the United States
     of America including Memorial Slone Kettering (MSKCC) and University
     of California Los Angeles (UCLA).

        • IMRT (Novalis) A medical equipment used for non-invasive stereotactic
     radiosurgery. Novalis is the optimal tool to effectively and safely perform the
     advanced techniques of 3-D CRT, high resolution ntensity Modulated
     RadioSurgery (IMRS) and Intensity Modulated RadioTherapy (IMRT) on
     tumors throughout the body. This provides the most accurate radioactive
     treatment at the site of tumor with minimal effects on good tissues. Novalis
     can be programmed for exposure of specific sites in four dimensions and
     accurate tumor shape.

        • Linear Accelerator

        • Brachy Therapy System Equipment with components for cancer
     treatment




22
   It is an objective of Wattanosoth Hospital to strive for practical and academic
excellence. Moreover, Samitivej hospital, BNH hospital and Bangkok Hospital
group across the country can link up with Wattanosoth Hospital to obtain
expert consultation through VCD conference system. This saves patients from
having to visit Wattanosoth Hospital on every occasion.

Bangkok Dusit Medical Service Public Company Limited rated as one of
the best companies in Asia Pacific by Forbes.
    Bangkok Dusit Medical Service Public Company Limited was rated as one
of the best companies in Asia Pacific in 2005 under “Best Under a Billion”
category by Forbes.

    The annual evaluation of Forbes “200 Best Under a Billion” in Asia Pacific
is based on the performance of the region's listed companies with annual
revenue under One Billion United States Dollar. The criteria includes companies
which have displayed profitability, economic dynamism, entrepreneurial
effectiveness and an impressive track record of giving value to shareholders.
Including continuous growth during the past five years and a profit before tax of
at least 5% in the latest fiscal year. Bangkok Dusit Medical Services Plc. or BGH,
which made it to the elite list along with 11 top Thai companies selected by Forbes.
    This ranking is a great pride of the company. Especially, BGH is only
hospital business firm among the two hundred companies in the Asia Pacific
selected by Forbes. This further reaffirms our leader-ship position in the Asia
Pacific region.




                                                                                       23
BANGKOK
INTERNATIONAL
HOSPITAL
                                                                              BANGKOK MEDICAL CENTER




Bangkok International Hospital has been operating since early 2006. In order to provide the International
standard high quality healthcare, advanced medical technology and services to foreign clients.
     The Company’s Shareholding Restructuring
        On the 17 th of October 2005, the Extraordinary General Meeting of
     Shareholders No.1/2005 has approved the company’s restructuring planning
     by acquisition shares from all shareholders of the eastern hospital group, which
     comprised of Bangkok Pattaya Hospital Co., Ltd., Bangkok Trad Hospital
     Co., Ltd., Wattanavej Co., Ltd.(Bangkok Chantaburi Hospital), and Bangkok
     Rayong Hospital Co., Ltd. Such purchase was subject to the condition that
     those shareholders must purchase the company's shares by using all proceeds
     received from the company as payment for the company's shares at the price
     of Baht 14.59 each. The proposal and reservation of shares were scheduled
     for the period from the 4th to the 20th of January 2006.

         The company expects to hold at least 95% stake in each hospital in the
     eastern group which will enhance the competitiveness and further fortify the
     company’s position in the healthcare business, considering the fact that the
     eastern region is one with unabated economic growth and a key economic
     and industrial center of Thailand.

     3. Operation

        The company, the affiliates and the subsidiaries are related as may be
     explained below:

        Primary business Specialized private medical institutions operated under
     the name of Bangkok Medical Center : BMC which is comprised of Bangkok
     Hospital, Bangkok Heart Hospital, Wattanosoth Hospital, and, Bangkok
     International Hospital which will be operational in early 2006.

        Investment business In addition to the healthcare business operated
     under Bangkok Dusit Medical Services Public Company Limited, the company
     has invested in healthcare and many relevant businesses.




26
   For businesses, the company has invested in 14 subsidiaries and affiliates operating private
hospitals in different areas with profit center management. Patients are occasionally referred to
specialized clinicians at another hospital in the network where necessary.

   With regard to relevant businesses, the company has invested in subsidiaries and affiliates
engaged in businesses such as pharmaceutical production, laboratory and medical evacuation.
These companies were established to cater to third parties and to support the company’s network
at market price.



Investment in Healthcare Businesses

                                                                                    Number       Shareholding
     Area of service                      Entity providing service
                                                                                    of beds       percentage

1. Inner Bangkok covering      Samitivej Public Company Limited:                      275              92.9
   Sukhumvit, Asoke, Silom     Samitivej Sukhumvit Hospital
   and Sathorn                 BNH Medical Centre Co., Ltd.: BNH Hospital             225             87.60
2. Outer Bangkok and           Samitivej Public Company Limited:                      400              92.9
   Samutprakarn                Samitivej Srinakarindra Hospital
                               Bangkok Prapadang Hospital Co., Ltd.                   145              79.0
                               Ramkhamhaeng Hospital Public Company Limited           300              19.0
                               (A general investment. not involved
                               with the management in this company).
3. Eastern region covering     Bangkok Pattaya Hospital Co., Ltd.                     200              49.0
   Chonburi, Rayong,           Bangkok Rayong Hospital Co., Ltd.                      200              81.0
   Chantaburi and Trat         Wattanavej Co., Ltd.: Bangkok Chanthaburi Hospital     200              62.0
                               Bangkok Trad Hospital Co., Ltd.
                               Samitivej Sriracha Hospital Co., Ltd.                  150              63.4
                                                                                      100              30.0
                                                                                            by Samitivej Plc.
4. Northeastern region         Udon Pattana Co., Ltd.: Ake Udon Hospital              350              10.0
   covering Udon Thani         (A general investment, not involved
                               with the management in this company)
5. Southern region covering    Bangkok Phuket Hospital Co., Ltd.                      170              99.5
   Phuket, Songkla and         Bangkok Hatyai Hospital Co., Ltd.                      400              98.5
   Surat Thani                 Bangkok Samui Hospital Co., Ltd.                        50             100.0
6. Siem Reap, Cambodia         B.D.M.S. International Medical                          50             100.0
                               Services Co., Ltd. (Not in operation)




                                                                                                                27
Investment in Relevant Businesses
                                                                                                                       Shareholding
             Type of business                                     Entity providing service
                                                                                                                        percentage
1. Production and sale of medication                  Medical Pharma Co., Ltd.                                               49.0
2. Medical laboratory                                 National Healthcare Systems Co., Ltd.                                  74.0
3. Bio Molecular laboratory                           Bio Molecular Laboratory (Thailand) Co., Ltd.                          95.0
4. PR and marketing service                           Cool & Joy Co., Ltd.                                                   30.0
5. Medical Evacuation                                 Bangkok Helicopter Services Co., Ltd.                                 100.0
6. Land lease for the operation of                    S.R. Property Investment Co., Ltd.                                     49.0
   hospital businesses in Cambodia.




4. Revenue structure of the company and subsidiary companies

  The revenue structures of the company and subsidiary companies in 2003 through 2005 may be
compared as below:

                                                                                                                     (Unit : Million Baht)

                                                                                    2005               2004                   2003
                                                               Shareholding
Type of Revenue                Entity providing service         percentage     Amount       %     Amount       %         Amount       %

From                   Bangkok Dusit Medical Services Plc.                     4,238.2     41.3   3,678.2     69.7       2,743.6     88.9
medical service fees   Bangkok Prapadang Hospital Co., Ltd.        79.0         134.8       1.3    189.2       3.6         150.2      4.9
                       Bangkok Rayong Hospital Co., Ltd.           81.0         474.9       4.6    334.2       6.3          63.3      2.1
                       Bangkok Trad Co., Ltd.                      63.4         144.2       1.4    124.7       2.4          22.5      0.7
                       Bangkok Hatyai Hospital Co., Ltd.           98.5         540.6       5.3    446.3       8.5          62.6      2.0
                       Bangkok Samui Hospital Co., Ltd.           100.0         159.8       1.6     50.3       1.0
                       Bangkok Phuket Hospital Co., Ltd.           99.5         787.5       7.7    368.0       7.0
                       Samitivej Public Plc.                       92.9        2,776.6     27.1
                       BNH Medical Centre Co., Ltd.                87.6         720.6       7.0
                       Wattanavej Co., Ltd.                        62.0         209.8       2.1
                       Total                                                  10,187.0     99.4   5,190.9     98.4       3,042.1     98.6
From                   National Healthcare Systems Co., Ltd.       74.0           42.7      0.4     69.4       1.3          37.2      1.2
laboratory fees        Bio Molecular Laboratory                    95.0           21.1      0.2     13.9       0.3           5.3      0.2
                       (Thailand) Co., Ltd.
                       Total                                                     66.8       0.6     83.3       1.6          42.5      1.4
Total Revenue from core operations                                            10,253.8   100.0    5,274.2   100.0        3,084.6 100.0




28
  Research
  and
  Development

    The company has regularly oganized academic seminars for Bangkok
Hospital doctors as well as those from other institutions in order to maximize
the capabilities of doctors in all tracts. Bangkok Hospital is currently certified
as the primary institution for continuous medical education project of the
Medical Practitioners Council. Doctors, nurses and medical practitioners
participating in seminars will be granted a Continuous Medical Education
(CME) credit for their renewal of medical professional practice license. The
notable medical seminars in 2005 were as follows :

   • March 2005 : The Fifth BGH Annual Academic Congress and the First
Dental and Maxillofacial Academic Meeting held at the Medical Practitioners
of Thailand.




   • August 2005 : The Sixth BGH Congress on Critical Care for Nurses was
held to further improve technical and managerial knowledge of nurses and
medical practitioners. The contents revolved around continuous care of
critical patients under the theme "For the Best in the Practical Knowledge
and Management of Critical Care".




                                                                                     29
        • The company has continuously provided its support to the activities of
     Vejdusit Foundation under the Royal Patronage of HRH Princess Galyani
     Vadhana Krom Luang Naradhiwas Rajanagarindra in order to help financially
     distressed patients and to promote research efforts of doctors working
     Bangkok Hospital Group and elsewhere for the development of Thai medical
     community.




        • Our contribution to research and development work over the past
     three years may be summarized as follows:
        2003 27.09 Million Baht
        2004 40.72 Million Baht
        2005 35.98 Million Baht




30
  Industry
  Outlook and
  Competitions

Industry Outlook and competition in
the international arena
   In this age of globalization, several countries have made it an agenda to
turn the medical service industry into a foreign currency earner. Thailand is
one of such countries. We have a policy aimed at turning Thailand into the
Medical Hub of Asia within five years from 2004 to 2008 with three emphases
on health products and services: medical treatment service business, health
promotion service business and Thai herb and health product business. It is
expected that the total income in this five years space will be 210,815 Million
Baht. Asian, Middle Eastern and European countries are targeted.

   Foreigners traveling to Thailand for treatments may be classified into
three groups:

   1. Patients from countries with poorer medical advancement than Thailand
such as Bangladesh, Burma and Cambodia. These clients are well to do people
or country leaders.
   2. Patients from countries with equivalent medical advancement as Thailand
such as Japan, Australia and Middle Eastern countries. These clients travel to
Thailand for treatments because their countries do not have sufficient medical
personnel to keep up with the demand of the clients.
   3. Patients from countries with more advanced medical advancement than
Thailand such as the United States of America, England and European
countries. Most of the clients come to Thailand for the treatment of diseases
not covered by the health insurance they have in their country. They are less
well to do people who do not wish to pay high medical bills. The queues for
medical treatment in their country are usually long as well.

   Most of the hospitals in Thailand which are capable of providing medical
service to foreign clients in Thailand are private hospitals with Bangkok
Hospital Group and Bamrungrad Hospital at the forefront. Other private
hospitals are also attempting to tap into this group of




                                                                                  31
     clients. With the combined efforts of private institutions, medical colleges
     and MOPH agencies, the objective of becoming Medical Hub of Asia is not
     a far fetched one. Thailand has many strengths other countries do not.

         Firstly, our South East Asian location is a regional hub for airlines and a
     convenient destination, especially with the opening of Suwannabhumi Airport.
     Secondly, we have a firmly established tourism industry that attracts foreigners
     to come for our health and medical services. Thirdly, our private and public
     hospitals are as capable as other countries in the region. We are generously
     supplied with modern medical equipments and specialized doctors. The
     quality of our service is unsurpassed as well.

     Industry Outlook and competition in Thailand

         Public and private institutions vie for the local medical service market and
     all seek to increase their market share. Medical institutions may be classified
     into three classes by their capability. Primary care: clinics, health centers and
     small hospitals capable of treating outpatients and simple procedures. Secondary
     care: medium-class public and private hospitals with a higher level of
     capability, able to operate and care for patients with more serious conditions
     and diseases. Tertiary care: large hospitals capable of treating nearly all
     diseases and performing more complex surgeries or procedures.

        All three classes of were greatly affected when the government announced
     their 30 Baht medical treatment policy. Clients are then divided into two
     groups. The first group being those who are covered by social security,
     government officials and 30 Baht medical treatment plan. The second group
     being those who are of better financial position and more capable of paying
     for medical services or covered by private company insurance plans. Public
     medical institutions, particularly those run by Ministry of Public Health, are
     required to accommodate clients who are covered by these different forms
     of health insurance plans. Many of these institutions are not allocated
     adequate budget




32
by the government. This is the reason why they are not able to improve their
service and technology as quickly. With more people turning to them for
medical treatments, the workload on their personnel increase and so are the
number of complaints as more mistakes are made.

   Small private medical institutions had to participate in the 30 Baht
medical treatment and social security plans. They are compensated for the
number of patients under their responsibility and as such they need to lower
their expenses which lead to complaints on service quality and drugs prescribed
for the users. They have difficulties expanding their services and competing
with public institutions with budget allocation.

    Most medical institutions catering to financially capable people with high
purchase power or private health insurance plans are in the tertiary care group
with or without a network. Some of such institutions are public limited
companies. The competition in this class is considerably high and many
players have developed themselves into specific centers for diseases such as
heart disease, diabetes, and neurological diseases. As high-level medical
equipments and technologies are required for these centers, it is imperative
for these institutions to have access to such technology and become the industry
leader. Additionally, they need a network transferring patients from other areas
of the country in order for them to become a major disease-specific center.

   To summarize, changes in the medical service industry are not as rapid
or significant as in other industries. We are partly affected by these changes.
Regardless of economic improvement or deterioration, people will continue
to have illnesses although their purchase power may vary from time to time.
Visionary entrepreneurs who keep themselves abreast of these changes should
be able to survive and evolve.




                                                                                   33
Future
Projects

              The Company is progressing into its fourth decade marked by the recovery
           of the Thai economy, the possibility that Thai people will be more concerned
           about their health, the promotion of Thailand as “the Asian Healthcare Hub”,
           medical freedom under the FTA and the increasing interest of foreign patients
           to be treated in Thailand for our international standard medical personnel
           and lower service fees compared to other countries of a similar medical
           standard.




              Given the factors above, the company has altered the administration
           of Bangkok Hospital at Soi Soonvijai so that it is presently known as
           Bangkok Medical Center : BMC which is comprised of Bangkok Hospital,
           Bangkok Heart Hospital, Wattanosoth Hospital and Bangkok International
           Hospital. Further investment plans are as follows:




34
    1. Bangkok Dental and Maxilofacial Center located at the entrance of
Soi Soonvijai on New Petchaburi Road. Construction has been started since
late 2005 with approximately cost of Baht 250 million. It is expected to
become operational within 2007.

  2. 100-bed private hospital in Siam Reap, Cambodia, to be operated
under a new subsidiary company which incorporated in Cambodia in
December 2005.

Expected benefits

   1. To expand special tract medical services and accommodate the increasing
number of patients.
   2. To tap into the South East Asian market and receive patients transferred
from other countries.




                                                                                 35
BANGKOK
REHABILITATION
CENTER
                                                                                  BANGKOK MEDICAL CENTER




Bangkok Rehabilitation Center is located at Rehabilitation Building, 3rd floor. To complete medical expertise,
physiotherapist, activitor and stomatologist for service exclusively upgrade.
 Risk Factors

1. Risks from economic fluctuations

    Private hospital business is one which may be affected by economic fluctuations. At a time of economic
recession when people earn less, they may cut down on their health expenses and opt for cheaper services of
public hospitals. On the contrary, people prefer private hospitals to public ones when the economy is rising
and they earn more as the services offered by private hospitals are superior. Fortunately, the majority of the
company’s clients are in the premium class. They are not greatly affected by economic situations and continue
to use our services even when the economy is in recess. In addition, the company’s constant investments in
modern medical equipments help build confidence in the clients as well. More importantly, the facts that the
company is a large company with strong financial position and experienced executives have shown their
capability in leading the company through several economic crises are clear evidence that the impact of
economic fluctuations on us can be mitigated.

2. Risks from the operation

    Reputation and confidence are key decision factors for patients. Bangkok Hospital is backed by over thirty
years of experience, highly capable and attentive executives, careful selection of personnel and efficient
management system. The company has a quality assurance center dedicated to the implementation of systems,
standards, evaluations and supervisions that ensure quality. This is inclusive of risk management, medical
treatment quality control, infectious disease control and environmental issues for the safety of clients and
employees. The company has also published quality control manuals for the different departments as a
guideline for all staffs. Additionally, we have established a Medical Staff Organization to monitor and
evaluate the performance of doctors and nurses. All of these efforts greatly help boost the confidence
patients have in our services.




38
3. Risks from the competition

    The medical business has become increasingly competitive. In addition to public and private hospitals, it is
possible that foreign entrepreneurs will soon enter the scene with the government’s plan to liberate the medical
service industry. These foreign entrepreneurs with good reputation and experience will likely be interested in
setting up hospitals in Thailand. They are at an advantage because of their technological advancement,
network size and image as global players. Nevertheless, the hospital business is a complex one and varies from
one country to another so entrepreneurs need to understand consumers’ requirements well. This is where
foreign entrepreneurs are at a disadvantage. Further, medical personnel practicing in Thailand need to be
issued a proper license by the Thai authority therefore foreign entrepreneurs may not relocate their personnel
from foreign countries and have them practice in Thailand. Given the reasons above, foreign entrepreneurs
will face numerous obstacles even if Thai medical service industry is liberalized. As a strong local entrepreneurs,
the company has an extensive network of hospitals covering key locations across the country, a great state of
readiness, necessary equipments and standardized services. We believe that these factors help mitigate risks
from the competition. We will nevertheless continue to improve our services and remain at the top of the
industry.

4. Risks from medical personnel scarcity

    Despite the effort of the government to encourage production of medical practitioners by educational
institutions, the actual process requires time and expertise. Consequently, with the rapid growth of the economy
and the medical service industry, it is possible that the supply of practitioners may not be sufficient in the
future. The company is not yet significantly affected because medical personnel are attracted by reputation of
the group. In spite of this, the company has prepared to accommodate the growth through compensations,
trainings, welfares and recreational activities which will attract the employees and retain them at the
same time.




                                                                                                              39
5. Financial risks

Risks from loans to subsidiaries and joint ventures
   The company deeply concerns with the provision of financial assistance to subsidiaries and affiliates. As of
the 31st of December 2005, the burden of loans to subsidiaries was only Baht 1.2 million. This amount is not
considered significant to our financial status. In addition, the company does not have a policy to provide
additional loans to subsidiaries and affiliates. Such companies will be encouraged to secure loans directly
from financial institutions.

Risks from rising interest rates
   The rising interest rates may affect to financial costs as well as cash flows of the company and the subsidiaries.
Since the group still has an existing loans and also need the external sources of funds for the further expansion.
However, the group has a positive relationship with many financial institues, the higher in interest rate may
not significantly affect to the group performance as compared to the others.



Risks from debt collection
    Patients are generally treated before payment is made. This practice poses risks from collection of service
fees in full amount. Nevertheless, the company has a strict policy of avoiding possible risks from debt collection.
No credit is granted to clients. The hospital prepares an estimate of treatment fees for the patients in advance
and informs them of the treatment fees incurred at intervals in order to minimize the burden of a single payment
of treatment fee upon their discharge from the hospital. As for clients who are party to agreements, the company
has a policy of carefully granting credits based upon the credit and financial status of the party company and
reviewing transactions made with the company on an annual basis. The said policy is effective in the reduction
of possible risks from debt collection.




40
  Shareholders
  Structure
  and
  Management

1. Shareholders structure

    The major shareholders as of the 3rd of October 2005, which was the latest closing date of registrar book
in year 2005, were as follows:

    No.           Name                                                        Number of shares            Shareholding percentage
      1           Prasert Prasartthong-osoth, M.D. *                                   149,235,707                                12.83%
      2           Bangkok Airways Co., Ltd.*                                           110,841,869                                 9.53%
      3           Viriyah Insurance Co., Ltd.                                           89,608,758                                 7.70%
      4           Mr. Satit Viddayakorn and spouse                                      69,266,790                                 5.95%
      5           Pongsak Viddayakorn, M.D. and spouse                                  60,722,757                                 5.22%
      6           Raffles Nominees (PTE) Limited                                        40,027,446                                 3.44%
      7           Bangkok Pattaya Hospital Co., Ltd.                                    39,183,026                                 3.37%
      8           Chirotchana Suchato, M.D. and spouse                                  36,953,748                                 3.18%
      9           Miss Poramaporn Prasartthong-osoth                                    31,985,000                                 2.75%
     10           HSBC (Singapore) Nominees (PTE) Limited                               27,777,900                                 2.39%
   Total                                                                              655,603,001                                56.35%
Source: Thailand Securities Depository Co., Ltd.
* The first and the second ranking shareholders are considered as the same person under Section 258.of the SEC Act B.E.2535 (A.D.1992)




2. Management
2.1 Number of Employees
   The company has a total of 2,489 employees as of the 31st of December 2005 as below:


                                                                                                                                (Unit: Person)

  Type of employee                  Permanent doctors,                                 Temporary doctors,
                                     nurses and staffs                                  nurses and staffs                           Total
  Doctors                                       196                                               233                                    429
  Nurses                                        599                                                 32                                   631
  General staffs                             1,308                                                121                               1,429
  Total                                      2,103                                                386                               2,489




                                                                                                                                           41
2.2 Managerial structure
    As of the 31st of December 2005, the company’s managerial structure is comprised of the Board of
Directors, the Audit Committee and the executives as follows:

Board of Director

       1.     Prof. Arun Pausawasdi, M.D.                             Chairman
       2.     Prasert Prasartthong-osoth, M.D.                        Vice Chairman
       3.     Prof. Snoe Indrasukhsri, M.D.                           Independent Director
       4.     Pongsak Viddayakorn, M.D.                               Director
       5.     Chirotchana Suchato, M.D.                               Director
       6.     Chuladej Yossundharakul, M.D.                           Director
       7.     Prof. Santasiri Sornmani, M.D.                          Independent Director
       8.     Yingdao Krairiksh, M.D.                                 Director
       9.     Mr. Anuchat Chaiprapa                                   Independent Director
      10.     Mr. Wallop Adhikomprapa                                 Director
      11.     Mr. Thavatwong Thanasumitra                             Director
      12.     Kitipan Visudharom, M.D.                                Director


Authorized directors

  Two directors out of Pongsak Viddayakorn, M.D., Chuladej Yossundharakul, M.D., Chirotchana Suchato,
M.D., and, Mr. Wallop Adhikomprapa sign jointly and affix the company’s seal.

Duties and responsibilities

    1. Perform duties using their knowledge and expertise for the benefit of the company in accordance with the
regulations of the company and resolutions of the shareholders meeting. Directors are authorized to perform
actions indicated in the articles of association, Public Company Act and relevant laws.
    2. Comply with the provisions and the good practices of listed company directors of the Stock Exchange
of Thailand.
    3. Establish policies, approve business plans, annual budget and investment; and, make financial decisions.
   4. Monitor the operational results of the company in order to ensure consistency with the established
goals and plans.




42
   5. Arrange for efficient internal control and audit systems for the purposes of auditing, operational oversight
and liaison with the audit committee.
   6. Protect the interests of shareholders and practice standardized and transparent disclosure of information.

Audit Committee

   1.   Prof. Snoe Indrasukhsri, M.D.                             Chairman
   2.   Prof. Santasiri Sornmani, M.D.                            Member
   3.   Mr. Anuchat Chaiprapa                                     Member


Duties and responsibilities

   In order that the Audit Committee may perform the duties assigned by the Board of Directors, the Audit
Committee shall have the following duties and responsibilities:
   1. Ensure the correct, complete and reliable issuance of reports and disclosure of information in financial
reports of the company by liaising with external auditors and executives responsible for the preparation of
quarterly and annual financial reports.
   2. Ensure the use of proper and efficient internal control measures and engage in the joint revision with
independent external auditors and internal auditors in order to ensure consistency.
   3. Review transactions with associated companies or individuals in order to prevent conflicts of interest.
   4. Ensure compliance with the regulations of the Stock Exchange of Thailand and other relevant laws.
   5. Review evidence for internal investigation in the case where fraud or abnormality is suspected or significant
defect is found in the internal control measures for further submission to the Board of Directors.
   6. Order and review evidence in the case where violation of law or any regulation of the Stock Exchange
of Thailand with possible significant effects on the financial status and the operational results of the listed
company is suspected.
   7. Nominate auditors and annual auditing fee to the Board of Directors for the approval of the shareholders
meeting.
   8. Complete the other tasks assigned by the Board of Directors.




                                                                                                               43
CEO Committee

   As of the 17th of September 2005, the Board of Directors has had a resolution at Meeting No. 9/2005 appointing
the CEO Committee as follows:

       1.    Prasert Prasartthong-osoth, M.D.                          Chairman
       2.    Pongsak Viddayakorn, M.D.                                 First Vice Chairman
       3.    Chuladej Yossundharakul, M.D.                             Second Vice Chairman
       4.    Chirotchana Suchato, M.D.                                 Member
       5.    Mr. Wallop Adhikomprapa                                   Member
       6.    Yingdao Krairiksh, M.D.                                   Member
       7.    Chatri Duangnate, M.D., FAAP., FACMQ.                     Member
       8.    Kitipan Visudharom, M.D.                                  Member
       9.    Mr.Lee Khoe Soa                                           Member
      10.    Krittavith Lertutsahakul, M.D.                            Member
      11.    Pichit Kangwolkij, M.D.                                   Member
      12.    Assoc.Prof. Ajjima Srethaputr                             Member and Secretary


Duties and responsibilities

    1. Establish strategies, policies, business and budget plans for the approval of Board of Directors.
    2. Oversee and monitor the operation as authorized by Board of Directors in accordance with the regulation
approved by Board of Directors with utmost benefit of the company and the shareholders in mind to ensure
efficiency and favorable business environment.
    3. Assign duties to, follow up on and oversee the operation of the management under the supervision of
Chairman of Executive Board as assigned by Board of Directors.
    4. Review matters to be presented to Board of Directors for approval, identify solutions to the problems
of the company, and, propose administrative and personnel policies for the consideration of Board of Directors.
    5. Propose the appointment and the removal of high level executives and specify duties and responsibilities
of high level executives in different areas.
    6. Engage in other duties occasionally assigned by Board of Directors.
    7. Legitimately and honestly proceed in accordance with the resolutions of shareholders meetings and
Board of Directors meetings while mindful of interests, objectives and regulations of the company.




44
The duties and the authorities above shall not allow the executives and Chairman of CEO Committee to approve
transactions relating to individuals with whom they have conflicts of interests or transactions which may lead to
conflicts of interests of other nature (according to the Notification of Securities and Exchange Commission)
with the company or subsidiaries. Such transactions or matter shall be presented to the Audit Committee and/
or Board of Directors whichever the case may be for approval.

Management team (as definition of the Securities and Exchange Commission)

       Name                                           Position
  1.   Pongsak Viddayakorn, M.D.                      President and Acting Hospital Director of
                                                      Bangkok Heart Hospital
  2.   Chatri Duangnate, M.D., FAAP., FACMQ.          Chief Operating Officer
  3.   Mr. Wallop Adhikomprapa                        Vice President-Accounting & Finance
  4.   Assoc. Prof. Ajjima Srethaputr                 Vice President-Marketing and Business
                                                      Development, and, Assistant to Chairman
                                                      of CEO Committee
  5.   Pichit Kangwolkij, M.D.                        Hospital Director of Bangkok Hospital
  6.   Surapong Lookhanumanjao, M.D.                  Hospital Director of Wattanosoth Hospital


Duties and responsibilities
   The management is responsible for internal administration in accordance with established policies and
business goals.

2.3 Selection of directors
   The appointment and the removal of directors shall be as prescribed in the articles of association as follows:
   • The board of directors of the company shall be consisting of not less than five persons, not less than
one half of the number of such directors must reside within the Kingdom of Thailand
   • The director must be an ordinary person and has the following qualifications:
     (1) Having become sui juris;
     (2) Not being a bankrupt, incompetent or quasi-incompetent;
     (3) Having never been imprisoned by the final judgment of the court for an offence related to property
         committed with dishonest intent;
     (4) Having never been dismissed or removed from the position in a governmental authority or organization
         or state unit on a charge of performance of duty in bad faith.




                                                                                                             45
    • The directors shall be elected at the shareholders meeting in accordance with the criteria and procedures
as follows:
      (1) Each shareholder shall have one share for one vote multiplied by the number of the nominated
          directors;
      (2) Each shareholder may exercise all the votes, he or she has under (1) to elect one or several persons as
          director or directors, but the shareholder cannot divide his or her votes to any particular person or
          persons; and
      (3) Persons who receive the highest votes arranged in order from higher to lower in a number equal to
          that of the number of directors to be appointed are elected to be the directors of the Company. In the
          event of a tie at a lower place, which would make the number of directors greater than that required,
          it should be elected by a draw in order to get the number of directors who should be elected.
    • At every annual general meeting of shareholders, all directors shall resign from the board of directors
of the company and the new board of directors shall be elected at the same time, but the former board of
directors may perform its duties as necessary until the new board of directors may take over its roles.
    • A vacating director may be eligible for re-election.
    • Apart from vacating at the end of his office term, directors shall vacate office upon.
      (1) death;
      (2) resignation;
      (3) lack of qualifications or possession of prohibited characteristics under the laws;
      (4) the shareholders meeting passed a resolution to resign with a vote not less than three-fourths (3/4) of
          the total votes of shareholders who attend the meeting and are entitled to vote and must also have total
          shares not less than one-half of the number of shares held by shareholders who attend the meeting
          and are entitled to vote.
      (5) removal by a court order.
    • Any director wishing to resign from the director position shall submit a resignation letter to the Company.
The resignation shall take effect from the date on which the resignation letter reaches the Company.
    • In the event that a position of director becomes vacant for any reason other than the end of his office
term, the board of directors shall on the next board meeting appoint a qualified person, not possessing
prohibited characteristics under the laws to be a new director, except if such office term remaining is less than
two (2) months. The substitute director shall hold office only for the remainder of the term of office of the
director whom he replaces.
    The resolution of the board of directors pursuant to the first paragraph must be approved by the votes of
not less than three-fourths (3/4) of the number of the remaining directors.




46
    • In the event that the vacancies in the vacancies in the board of directors resulting in the number of directors
being less than the number required for a quorum, the remaining directors shall perform and act in the name
of the board of directors only in matters relating to the calling of the shareholders meeting to elect directors to
replace all the vacancies.

   In addition, the company has stipulated that the Board of Directors shall be comprised of at least three
independent directors of the qualifications specified by the Securities and Exchange Commission and the
Stock Exchange of Thailand.

3. Executives’ compensation

3.1 Monetary compensation in 2005
    • The twelve members of the Board of Directors have been paid a compensation in the form of meeting
allowance and director’s remuneration for a total of Baht 15.61 million in 2005 as follows:

                                                                                 (Million Baht)
            List of Directors' Name                                     Total compensation
     1.     Prof. Arun Pausawasdi, M.D.                                          1.76
     2.     Prasert Prasartthong-osoth, M.D.                                    1.26
     3.     Prof. Snoe Indrasukhsri, M.D.                                       1.26
     4.     Pongsak Viddayakorn, M.D.                                           1.26
     5.     Chirotchana Suchato, M.D.                                           1.26
     6.     Chuladej Yossundharakul, M.D.                                       1.26
     7.     Prof. Santasiri Sornmani, M.D.                                      1.26
     8.     Yingdao Krairiksh, M.D.                                             1.26
     9.     Mr. Anuchat Chaiprapa                                               1.26
    10.     Mr. Wallop Adhikomprapa                                             1.26
    11.     Mr. Thavatwong Thanasumitra                                         1.26
    12.     Kitipan Visudharom, M.D.                                            1.26


    • Twelve members of CEO Committee were paid compensation in the form of meeting allowance for a
total of Baht 0.19 million in 2005. (CEO Committee was appointed by Board of Directors on the 17th of
September 2005.)
    • Six executives were paid compensation in the form of monthly salary, bonus and meeting allowance for
a total of Baht 23.96 million in 2005.




                                                                                                                 47
3.2 Other compensations
    In addition to meeting allowances, directors’ rewards, salary and bonus, the company provides the directors
and executives with office cars, cellular phones and other items. They are also entitled to medical treatment
welfare as per the regulation of the company as like permanent employees.



4. Dividend payment policy

   The company and the subsidiaries pay out dividends to the shareholders at the approval of the Board of
Directors, dependent upon the operational results and the dividend payment ability of the company in each
year. An approval of the shareholders meeting is required with the exception of interim dividend payment for
which approval is granted by the Board of Directors.

   The payment of dividends during the past four years (2001-2005) may be summarized as follows:


                                                                              Rate of dividend
 Year of operational results for which dividend is paid                        (Baht per share)           Date of dividend payment
 2004       Payment of dividend from the operational                      0.50 Baht per share*                  The 6th of May 2005.
            results of January - December 2004.
 2003       Payment of dividend from the operational                           4 Baht per share                The 21st of May 2004.
            results of January - December 2003.
 2002       Payment of dividend from the operational                           3 Baht per share               The 23rd of May 2003.
            results of January - December 2002.
 2001       1. Payment of dividend from the operational                        2 Baht per share                The 24th of May 2002.
               results of July-December 2001.
            2. Payment of interim dividend from the                            1 Baht per share The 17th of September 2001.
               operational results of January-June 2001.

Remark: The company has registered the change of ordinary share par value from 10 Baht to 1 Baht on the 11th of May 2004.




48
 Corporate
 Governance

   The Board of Directors realizes its roles, duties and responsibilities of good corporate governance in order
to ensure continuous and stable growth of the business through efficient and transparent management for
the confidence of all parties involved and the utmost benefit of the company and the shareholders.

    Therefore, the Board of Directors has had a resolution at the 9/2005 meeting on the 17th of September 2005
approving existing and future policies concerning good corporate governance which are consistent with the
fifteen principals of corporate governance.

1. Corporate governance policy (the first principal of corporate governance)
   The company is operating under the governance of the Board of Directors with the policy of transparent
and effective management with responsibility to the greatest benefits of the organization and all interested
parties in order to prevent any conflict of interests and ensure the long-term benefit of the shareholders.
The company requires compliance with the articles of association of the company, laws on securities and
Security Exchange, requirements of the Security Exchange and laws relevant to the business of the company
as well as the criteria of company with good corporate governance stipulated by the Security Exchange.



2. Shareholders: Rights, equality and shareholders meeting (the second and the fourth principals of
corporate governance)
   The company realizes and respects the equality of rights of all shareholders and is seriously concerned about
the receipt of accurate and complete information by the shareholders. Shareholders may exercise their right
and safeguard their interests by giving opinions and voting at shareholders meetings as well as taking part in
important decisions including Board of Directors appointment. For the past shareholders meetings, the
company has sent letter of notifications and accompanying information to the shareholders at least seven days
in advance and arranged for publication of shareholders meeting notification in newspapers for three
consecutive days at least three business days prior to the date of meeting. The opinion of the Board of
Directors and detailed documents associated with the meeting in Thai and English shall be provided to the
shareholders prior to the meeting. The company has granted an alternative to the shareholders in 2003 in that
they may assign their authority to the three independent directors in the event where they are unable to
participate in the meeting. Shareholders may prepare a petition requesting Board of Directors to call for an
extraordinary shareholders meeting at any reasonable time as specified in regulations of the company by
stating a clear reason. Board of Directors shall call for a shareholders meeting within one month from the day
on which the letter from the shareholders is received.




                                                                                                            49
   The Board of Directors recognizes the importance of shareholders meeting and all twelve directors shall
participate in the meeting in order that the shareholders may equally exercise their rights in expressing their
opinions and direct questions to the board of directors. Correct and complete minutes are taken for later revision
by the shareholders and relevant parties.

3. Rights of stakeholders (the third and the seventh principals of the corporate governance)
    The company recognizes the importance of rights of all interested parties and treats all employees with
equality and fairness. Purchases of product and service from trading partners are completed as per the trading
conditions and agreements entered into with them. Conditions of loan agreements are observed. Further, we
are seriously concerned with the confidentiality of clients and have established a unit to specifically monitor
quality. The company has a policy of operating with responsibility to the society, relevant parties and personnel
of the organization. The company has adopted the ISO 14001 environment management system and announced
the “Environment, Hygienic Profession and Safety Policy” for use within the hospital. Employees and relevant
parties are informed of this for determinedand continuous practice.

   Further, the Company has established Wejchadusit Foundation to support the research efforts of doctors
nationwide. Other notable projects include “Rak Jai Khun Hospital” under which youths are encouraged to
creatively develop measures to prevent health problems and a healthcare preventive program called “Thai
Chuay Thai”.

4. Leadership and visions (the fifth principal of corporate governance)
    The Board of Directors has a role of establishing the visions of the company in conjunction with the
executives, practicing good corporate governance and assessing the performance of executives while giving
them the freedom to make decisions for the utmost benefit of shareholders as well as all interested parties.
In practice, the Board of Directors has appointed the President as the person responsible for the management
of the company and established definite roles, duties and responsibilities for the Board of Directors and the
executives.

    Additionally, the company encourages directors of the company and associated companies to participate
in the Director Certificate Program (DCP) and Director Accreditation Program (DAP) of Thai Institute of
Directors Association in order that they may attain better understanding on efficient governance and use the
knowledge gained to realize the corporate governance policies. Directors having completed the Director
Certificate Program are Mr. Wallop Adhikomprapa (20 th Class) and Mr. Thavatwong Thanasumitra
(27th Class).




50
   Prof. Santasiri Sornmani, M.D. (43rd Class), Yingdao Krairiksh, M.D. (44th Class), Prof. Snoe Indrasukhsri,
M.D. (45th Class), Prof. Arun Pausawasdi, M.D. (45th Class), Prasert Prasartthong-osoth, M.D. (45th Class),
Pongsak Viddayakorn, M.D. (45th Class), Chuladej Yossundharakul, M.D. (45th Class), and, Chirotchana
Suchato, M.D. (45th Class).

5. Conflicts of interest (the sixth principal of corporate governance)
    The Board of Directors and the executives have proceeded strictly in accordance with the criteria of the
Stock Exchange of Thailand and the Securities & Exchange Commission in order to carefully, reasonably and
independently eliminate conflicts of interest in good faith for the benefit of the company. In order to ensure
transparency and prevent personal gaining of benefits, the company has established a policy on the use of
internal information preventing directors, executives and employees (including spouses and children not of
juristic age of the said individuals) from receiving vital internal information which may affect the stock trading
price or the use of vital, undisclosed internal information for the benefit of oneself or others. Directors and
executives are responsible for the preparation and the submission of shareholding report to the Securities &
Exchange Commission. They need to report any change in the shareholding to the Secretary of Board of
Directors on the monthly basis in order that the secretary may prepare a report of such for subsequent
presentation to the Board of Directors meeting.

6. Business ethics (the seventh principal of corporate governance)
    The company seriously values operational ethics, particularly that concerning clients treated at the hospitals.
Therefore, all personnel are encouraged to constantly observe the rights of patients. A code of ethical conduct
for executives and personnel is being prepared as a guideline for practice with clients and all related parties.

7. Balance of non-executive directors (the eighth and the ninth principals of corporate governance)
   The Board of Directors is comprised of 12 directors; 7 of which are executive directors, 3 of which are
independent directors and 2 of which are non-executive directors. The Chairman of the Board of Directors
shall be a non-executive director and not the same person as the President of the company in order that the
Chairman may be sufficiently independent from the management and that policy and management works
are appropriately separated for balance.

8. Compensation of directors and executives (the tenth principal of corporate governance)
   The company does not currently have a subcommittee to specify compensations. However, an appropriate
consideration process is in place. That is, the compensation of directors shall be approved by the shareholders
meeting and the compensation of high-level executives shall be as per the criteria and the policy specified by
the Board of Directors and dependent upon the operational results of the company and the performance of
each executive.




                                                                                                               51
9. Board of Directors meetings (the eleventh principal of corporate governance)
   The company has scheduled Board of Directors meetings in advance throughout the year on every third
Saturday of the month so that all directors may be aware of the schedule and allocate the time for their
participation on every occasion. Agendas for each meeting have been prepared in advance with continued agenda
for the follow up on the duty assigned. The secretary of the Board of Directors shall deliver a letter of
invitation with agendas at least seven business days in advance in order to grant the board of directors sufficient
time to study the data prior to the meeting. The Board of Directors has held a total of 16 meetings in 2005, 12
of which were ordinary meetings and 4 of which were extraordinary meetings. Directors present for these
meetings were as follows:


                                                                                     Number of participation/
 Director                                                Title                        number of all meetings
  1. Prof. Arun Pausawasdi, M.D.                         Chairman                               15/16
  2. Prasert Prasartthong-Osoth, M.D.                    Vice Chairman                           9/16
  3. Pongsak Viddayakorn, M.D.                           Director                               16/16
  4. Chirotchana Suchato, M.D.                           Director                               15/16
  5. Chuladej Yossundharakul, M.D.                       Director                               16/16
  6. Yingdao Krairiksh, M.D.                             Director                               15/16
  7. Mr. Wallop Adhikomprapa                             Director                               15/16
  8. Mr. Thavatwong Thanasumitra                         Director                               16/16
  9. Kitipan Visudharom, M.D.                            Director                               12/16
 10. Prof. Snoe Indrasukhsri, M.D.                       Independent Director                   16/16
 11. Prof. Santasiri Sornmani, M.D.                      Independent Director                   16/16
 12. Mr. Anuchat Chaiprapa                               Independent Director                   15/16




10. Subcommittees (the twelfth principal of corporate governance)
    The Board of Directors of the company has appointed an Audit Committee to review financial reports of
the company to ensure correctness, complete and sufficient disclosure, availability of appropriate and efficient
internal control measures, compliance with relevant regulations and laws; to screen and nominate auditors,
to prevent conflicts of interest and to perform any other duty assigned by the Board of Directors.




52
11. Internal control measures and auditing (the thirteenth principal of corporate governance)
   The Board of Directors has the roles, the duties and the responsibilities stated under the managerial
structure section. An Audit Committee comprising of three members, one of whom is of accounting and
financial knowledge, is appointed by the Board of Directors.

   As for internal control, the company has arranged for an accounting office to serve as the internal auditor
who would periodically inspect the operations in order to ascertain that the internal control measures of the
company are sufficient for the prevention of possible risks and to report the results of such internal audit to
the executives and the Board of Directors meeting so that improvements can be made for greater efficiency.

12. Investor relations (the fifteenth principal of corporate governance)
    The Board of Directors of the company recognizes the importance of disclosure of correct and complete
information including financial reports and general information to the shareholders and investors. However,
the company has yet to establish a unit specifically responsible for the provision of information to investors.
The Vice President for Accounting and Finance was assigned to communicate with institutional investors,
shareholders, analysts and relevant governmental agencies. Investors or other interested parties may request
for information at www.bangkokhospital.com

13. Internal information usage
   The company has a policy prohibiting directors, executives and employees who have learned of internal
information from using such information to their own benefits. The individuals involved are required to
proceed as follows:
   • The company educates directors and executives on their duties to report the stock trading conducted by
themselves, their spouses and minor children as well as the penalties under the Securities and Exchange Act
B.E. 2535 (A.D.1992), its amendments and the stipulations of the Stock Exchange of Thailand.
   • Directors and executives are responsible for the preparation and the submission of the shares held
by themselves, their spouses and minor children to the Securities & Exchange Commission as follows:
     (1) Report of the security holding of the company (Form 59-1) within thirty days from the day on which
         they are appointed as a director or an executive.
     (2) Report of change in security holding of the company (Form 59-2) as a result of acquisition, disposition
         or transferring of securities within three business days from the day of such transactions and a copy
         of such shareholding report shall be submitted to the company within the same day as the day on
         which such report is submitted to the Securities & Exchange Commission.




                                                                                                            53
 Transactions
 with
 Related
 Parties


1. Natures of transactions

    Transactions between Bangkok Dusit Medical Services Public Company Limited and related companies
or individuals are disclosed in Note 4 to the financial statements and may be classified as follows:

1.1 Trading conventional to the course of business
    The company has a policy of completing transactions with associated companies as those in the normal
course of business. Such transactions shall be necessary, reasonable, supportive of the business and for the
utmost benefit of the company. The trading conditions are not different from those used in transactions with
outsiders.

1.2 Financial assistance
   As of the 31st of December 2005, the company has provided financial assistance to subsidiaries as follows:




                                                                                                     (Unit: Million Baht)

                                                                                        Short-term       Long-term
               Associated company                 Nature of relationship                   loan            loan

Subsidiaries
Bangkok Prapadang Hospital Co., Ltd.        The company holds 79% of its                   0                  1.20
                                            shares and has installed joint directors.
                                                                                           0                  1.20



Individuals involved as joint directors and executives include:
   1. Chuladej Yossundharakul, M.D.
   2. Mr. Anuchat Chaiprapa

Interested individuals holding more than 5% of shares with voting right in the subsidiaries or the joint
ventures.
   - None -




54
2. Method of entering into the transactions

    The company has related transactions like other businesses. These transactions are necessary and reasonable
for liquidity and utmost benefit of the company.

   Small related transactions with conventional trading conditions are considered and approved by the
management. Medium to large transactions with conventional and unconventional trading conditions are
considered and approved by the Board of Directors. Large transactions with unconventional trading conditions
are considered and approved by the shareholders meeting. Transactions are categorized as follows:

   • Small transactions: Transactions valued Baht 1 million or below, or, 0.03% of net tangible assets or
below, whichever is greater.
   • Medium transactions: Transactions valued Baht 1 million to Baht 20 million , or, 0.03% to 3% of net
tangible assets or below, whichever is greater.
   • Large transactions: Transactions valued Baht 20 million or greater, or, 3% of net tangible assets or greater,
whichever is greater.

   Rules and regulations of Stock Exchange of Thailand are strictly observed in the case where the transaction
in question qualifies as a related transaction by the definition of Stock Exchange of Thailand.

   As a concern for investors, the company has arranged for members of the audit committee to participate in
the Board of Directors meeting in order to ensure that related transactions are fair, appropriately priced
considering and of conventional trading conditions. In the case where the Audit Committee lacks expertise in
the matter of the transaction, the company shall arrange for an expert to give opinions on the transaction in
question for further consideration by the Audit Committee and/or Board of Directors and/or shareholders
meeting, whichever the case may be. Related transactions are disclosed in notes to the financial statements
audited by the auditors.

   With regard to the provision of financial assistance to subsidiaries, the current outstanding debt is only
1.20 Million Baht. The said borrowing was approved by the 2001 annual ordinary shareholders meeting allowing
provision of financial assistance to subsidiaries, subsidiaried and associated companies within a credit line of
Baht 1,500 million. United Advisory Service Co., Ltd., the financial advisor, had an opinion at that time that
such lendings to subsidiaries and relevant companies were reasonable and fair.




                                                                                                              55
3. Policy on the future related transactions

  The company’s policy on the future related transactions are as follows:


         Type of transaction                                          Outlook and policy
General business such as treatment             The company observes conventional business practices
and laboratory services                        and charges a fair market price not unlike third parties.
Transactions arising from general trading      The company conducts business as normal, gives and/
such as accounts receivable and                or is given similar repayment conditions as well as
accounts payable                               repayment duration to third parties.
Advance payment                                The company shall minimize the number of transactions
                                               and restrict type and amount of transactions.
Financial assistance                           • At the present, the company has no any policy to provide
                                               financial assistance to subsidiaries and affiliates as
                                               they are capable of securing loans on their own such as
                                               directly from a financial institution. But the company will
                                               negotiate for the best conditions to the group.
                                               • Nevertheless, the company might consider granting
                                               financial assistance if any subsidiary company is unable to
                                               borrow directly from a financial institution.
                                               • However, the such loan will be considered from their
                                               repayment ability. Conditions and interest rates are more
                                               as that of the market but not lower than the companyís
                                               cost of funds. In addition, the transactions shall comply
                                               with rules and regulations according to the Notification of
                                               Stock Exchange of Thailand.
Consultation and management                    Consultation and management services fee are charged
                                               at appropriate market price not difference to the third parties
                                               with proper service agreements made.




56
 Explanation
 and analysis
 of operating
 results
 and financial
 status


1. Operating results

    In 2005, the revenues from operations of the Company and Subsidiaries rose by 94.4% YoY, from Baht 5,274.2
million to Baht 10,253.8 million. Compared to 71.0% growth in 2004 and 31.6% growth in 2003. A continuous
revenue growth was attributed by the following reasons:
    • The increase in the Company’s operating revenues from Baht 2,743.6 million in 2003 to Baht 3,678.2
million and 4,238.2 million in 2004-2005. They grew by 34.0% YoY and 15.3% YoY, respectively. The growth
was supported by both increases in number of patients and service charges.
    • An expansion of the group which acquired more subsidiaries over the period 2003-2005. Especially a
rising stake in Samitivej from 37% in 2004 to 92.9%.in 2005, made a 276.9% hike in subsidiaries’ operating
revenues which contributed to the group, from Baht 1,596.0 million in 2004 to Baht 6,015.6 million in 2005.




   Consolidated Operating Revenues Structure                           2005             2004            2003

 Operating Revenues from the Company                                 4,238.2          3,678.2         2,743.6
 Operating Revenues from Subsidiries                                 6,015.6          1,596.0           341.1
 Total Operating Revenues                                           10,253.8          5,274.2         3,084.6

   As a result of the significant increase in consolidated operating revenues over the past two years, the ratio
of patient service cost to operating revenues improved from 60.3% in 2003 to 56.9%-57.9% in 2004-2005,
respectively. In addition, the administrative expenses to consolidated operating revenues ratio decreased from
26.7% in 2004 to 23.9% in 2005.

   However, a substantial expansion in buildings and medical equipment expenditure of the group during
2005 resulted to the group’s depreciation expenses rose from 7.0% of operating revenues in 2003-2004 to
9.7% in 2005.

   Consequently, the consolidated net profit margin fell from 11.8%-12.5% in 2004-2003 to 8.1% in 2005.




                                                                                                            57
2. Financial Status

2.1 Total Assets
   By the end of 2005, the Company and subsidiaries posted total assets of Baht 17,677.2 million, a rise of
21.1%YoY. The components were broken down into current assets of 8.1%, investment in affiliates and
subsidiaries of 7.0%, net property, plant & equipment of 78.6% and other assets of 6.3%. As compared to the
end of 2004, the proportion was composed of 11.7% current assets, 10.5% investment in affiliates and
subsidiaries, 73.7% net property, plant & equipment, and 4.1% other assets.

2.2 Capital Structure
   At the end of 2005, total liabilities of the company and subsidiaries totaled Baht 9,259.7 million, representing
52.4% of total liabilities and equity. A 38.0% rise from Baht 6,710.9 million in 2004. This was due to the group’s
business expansion which led to an increase in the group’s external sources of funds together with accounts
payable and accrued expenses.

    While total equity was recorded at Baht 7,889.6 million by the end of 2005, representing 44.6% of total
liabilities and equity. A slight growth of 4.8% from Baht 7,525.0 million at the end of 2004.



3. Liquidity and Leverage ratio

   As of 2005, the Company and subsidiaries had a current ratio of 0.5 times, lower from 0.9 and 0.7 times at
the end of 2004 and 2003, respectively.

    However, the group still maintained the capital structure with debt to equity ratio of 0.9-1.1 times at the
end of 2003-2005 despite a 38.0% increase in the group’s liabilities during 2005. Also, the group had an impressive
interest coverage ratio at 8.2 times at the end of 2005 which was still acceptable in term of loan payment ability.




58
 Responsibility
 of the Board
 of Directors
 to the financial
 statements




    The Board of Directors is responsible for the financial statements and has assigned the Audit Committee
to review the financial statements for the past year. It was consequently informed that the financial statements
are carefully prepared in accordance with the generally accepted accounting principles, consistency with
appropriately selected accounting policies. The appropriateness of items shown in the consolidated financial
statement was evaluated and the disclosures of information in the notes to the financial statements was found
to be sufficient.

    In addition, the Board of Directors has established efficient internal control measures in order to ensure that
all accounting data are recorded completely and precisely. The assets are also kept safe from fraudulently acts or
significantly damages.

    It is the opinion of the Board of Directors that our internal control measures are satisfactory and capable of
instilling the credibility in the company’s separate financial statements and the consolidated financial statements
of the company and its subsidiaries for the year 2005.




                                                                                                               59
FINANCIAL
STATEMENT
BANGKOK MEDICAL CENTER
 Report of
 Independent
 Auditor

To The Board of Directors and Shareholders of Bangkok Dusit Medical Services Public
Company Limited

    I have audited the accompanying consolidated balance sheet of Bangkok Dusit Medical Services Public
Company Limited and its subsidiaries as at 31 December 2005, the related consolidated statements of earnings,
changes in shareholders' equity and cash flows for the year then ended, and the separate financial statements
of Bangkok Dusit Medical Services Public Company Limited for the same period. These financial statements
are the responsibility of the Company's management as to their correctness and the completeness of the
presentation. My responsibility is to express an opinion on these financial statements based on my audit.
The consolidated financial statements of Bangkok Dusit Medical Services Public Company Limited and its
subsidiaries, and the separate financial statements of Bangkok Dusit Medical Services Public Company Limited
as at and for the year ended 31 December 2004, which are presented herein for comparative purpose, were
audited by another auditor who, under his report dated 25 February 2005 expressed an unqualified opinion
on those financial statements.

    I conducted my audit in accordance with generally accepted auditing standards. Those standards require
that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statements
presentation. I believe that my audit provides a reasonable basis for my opinion.

   In my opinion, the aforementioned financial statements referred to above present fairly, in all material
respects, the financial position of Bangkok Dusit Medical Services Public Company Limited and its subsidiaries
and of Bangkok Dusit Medical Services Public Company Limited as at 31 December 2005 and the results of
their operations and cash flows for the year then ended in accordance with generally accepted accounting
principles.




                                                                                     Ernst & Young Office Limited
                                                                                     Bangkok : 28 February 2006




62
 BALANCE                                           BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 SHEETS                                            AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




ASSETS                                                                                                                            (Unit : Baht)
                                                                                 CONSOLIDATED                   THE COMPANY ONLY
                                                              Note              2005        2004                 2005        2004

CURRENT ASSETS
Cash and cash equivalents                                        4            528,949,910    1,038,564,334      100,760,368       749,445,142
Short - term investments                                                         746,600        18,469,108             8,018        6,240,255
Trade accounts receivable                                        6
     Related parties                                             7             13,966,690       15,532,417        4,481,572         5,122,091
     Other - net                                                              550,448,224      424,041,139      221,618,147       178,065,909
Total accounts receivable - net                                               564,414,914      439,573,556      226,099,719       183,188,000
Other receivable - related parties                               7              2,796,804       10,390,188       18,889,273        12,149,742
Short-term loans to related parties                              7               -                 -               -              130,000,000
Inventories                                                      8            160,861,479      115,401,683       70,004,964        42,365,738
Other current assets-net                                                      181,678,199       86,001,127       96,889,697        41,169,488
TOTAL CURRENT ASSETS                                                        1,439,447,906    1,708,399,996     512,652,039      1,164,558,365


NON-CURRENT ASSETS
Restricted bank deposit                                          5             20,609,107       14,941,655        7,440,000         6,000,000
Investments in subsidiary and associated                         9            576,079,361      988,497,808    5,708,672,045     4,922,796,434
   companies accounted for under equity method
Investmets in other companies - net                            11              55,316,980       56,241,514       55,316,980        56,241,514
Other long-term investments - net                              10             605,177,072      486,068,333      604,953,392       485,844,653
Long-term loans to related parties                               7               -              80,258,062        1,200,951        18,480,951
Interest receivable - related parties - net                      7             15,392,644       37,781,643       92,999,284       190,883,686
Property, plant and equipment - net                            12          13,453,639,598   10,283,195,833    4,189,714,924     2,770,342,607
Land not used in operation                                     14             438,927,180      471,427,180      438,927,180       471,427,180
Goodwill - net                                                                736,653,504      287,885,450         -                  -
Other intangible assets - net                                  13             206,824,771       96,122,724       41,519,126        44,422,368
Other non-current assets - net                                                129,135,918       87,549,909       10,907,984        10,518,673
TOTAL NON-CURRENT ASSETS                                                   16,237,756,135   12,889,970,111   11,151,651,866     8,976,958,066
TOTAL ASSETS                                                               17,677,204,041   14,598,370,107   11,664,303,905    10,141,516,431




The accompanying notes are an integral part of the financial statements.


                                                                                                                                            63
 BALANCE                                           BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 SHEETS                                            AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                         (Unit : Baht)
                                                                                CONSOLIDATED                  THE COMPANY ONLY
                                                                   Note       2005         2004               2005         2004

CURRENT LIABILITIES
Bank overdrafts and short-term loans from
     financial institutions                                         15      251,535,824       87,875,030    180,000,000          -
Short-term loans                                                            104,050,012         -               -                -
Short-term loans from related company                                7        10,000,000        -               -                -
Trade accounts payable
     Related parties                                                 7        16,761,728       5,263,302       7,334,691      13,714,010
     Others                                                                 624,151,251     475,510,688     233,106,396     192,425,549
Total trade accounts payable                                                640,912,979     480,773,990     240,441,087     206,139,559
Current portion of long-term loans                                  16      776,491,199     432,599,172     426,450,103     270,599,345
Current portion of liabilities under
     hire purchase and financial lease                              17      115,794,481       80,839,331      37,280,269      22,859,587
Accounts payable - construction and retention                               179,908,453     222,826,931       96,024,037      75,070,461
Other payable - related parties                                      7        12,027,493       9,190,716      16,695,585       5,468,450
Corporate income tax payable                                                118,867,847     104,460,619     114,231,878     102,963,874
Accrued expenses                                                            364,461,803     310,915,632     134,107,274     111,938,685
Other current liabilities                                                   263,505,600     148,901,186     109,534,132     171,636,647
TOTAL CURRENT LIABILITIES                                                  2,837,555,691   1,878,382,607   1,354,764,365    966,676,608




NON-CURRENT LIABILITIES
Excess for loss over cost of investment
     in subsidiarycompany accounted
     for under equity method                                         9          -               -              2,853,715       2,620,547
Long - term loans - net of current portion                          16     5,994,853,745   4,463,807,004   2,165,649,834   1,439,931,599
Long - term liabilities under hire purchase
and financial lease - net of current portion                        17      200,957,320     198,467,556       60,807,473      42,913,892
Deferred income                                                             183,431,233     159,819,890     183,431,233     159,819,890
Other non-current liabilities                                                 42,867,812      10,483,685       7,199,585       4,523,890
TOTAL NON-CURRENT LIABILITIES                                              6,422,110,110   4,832,578,135   2,419,941,840   1,649,809,818
TOTAL LIABILITIES                                                          9,259,665,801   6,710,960,742   3,774,706,205   2,616,486,426




The accompanying notes are an integral part of the financial statements.


64
 BALANCE                                           BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 SHEETS                                            AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




LIABILITIES AND SHAREHOLDERS' EQUITY (Continued)                                                                                     (Unit : Baht)
                                                                                       CONSOLIDATED                   THE COMPANY ONLY
                                                                           Note       2005       2004                  2005        2004

SHAREHOLDERS' EQUITY                                                        18

Share capital
Registered
     1,183,410,108 ordinary shares of
     Baht 1 each (2004 : 1,180,500,000 ordinary
     shares of Baht 1 each)                                                        1,183,410,108   1,180,500,000    1,183,410,108   1,180,500,000
Issued and fully paid-up
     1,163,410,108 ordinary shares of Baht 1 each                                  1,163,410,108   1,163,410,108    1,163,410,108   1,163,410,108
Premium
     Premium on ordinary shares                                                    4,322,607,094   4,322,607,094    4,322,607,094   4,322,607,094
     Revaluation surplus on investments                                     10      254,659,742     135,551,004      254,659,742     135,551,004
     Revaluation surplus on land and buildings                                      963,796,488     968,741,516      963,796,488     968,741,516
Retained earnings
     Appropriated - statutory reserve                                       20      118,341,011       90,157,544     118,341,011       90,157,544
     Unappropriated                                                                1,066,783,257    844,562,739     1,066,783,257    844,562,739
TOTAL EQUITY ATTRIBUTABLE TO
COMPANY'S SHAREHOLDERS                                                             7,889,597,700   7,525,030,005    7,889,597,700   7,525,030,005
MINORITY INTEREST - Equity attributable to
 minority shareholders of subsidiaries                                              527,940,540     362,379,360          -               -
TOTAL SHAREHOLDERS' EQUITY                                                         8,417,538,240   7,887,409,365    7,889,597,700   7,525,030,005
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                        17,677,204,041 14,598,370,107    11,664,303,905 10,141,516,431




The accompanying notes are an integral part of the financial statements.


                                                                                                                                               65
 STATEMENTS
 OF                                                BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 EARNINGS                                          AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




                                                                                                                                  (Unit : Baht)
                                                                                       CONSOLIDATED                THE COMPANY ONLY
                                                                           Note     2005         2004               2005       2004

REVENUES
Revenues from hospital operations                                           7     10,253,785,357 5,274,182,052   4,243,154,894 3,679,026,532
Other income
     Revenue from sales of food and beverages                               7       133,357,756     37,496,629     36,381,860     36,120,537
     Interest income                                                        7         4,603,882     13,833,329      7,009,730     21,628,856
     Others                                                                         172,943,122     87,315,552     74,509,797     60,668,803
 Total other Income                                                                 310,904,760    138,645,510    117,901,387    118,418,196
 Share of profit from investments accounted
     for under equity method                                                        159,043,698    222,505,847    334,813,148    101,772,915
TOTAL REVENUES                                                                    10,723,733,815 5,635,333,409   4,695,869,429 3,899,217,643
EXPENSES
     Cost of hospital operations and others                                 7      5,934,640,660 2,998,851,154   2,364,868,347 2,044,651,422
     Administrative expenses                                                7      3,422,215,207 1,753,166,705   1,179,507,094   932,501,983
     Directors' remuneration                                                         23,995,510     21,429,225     19,378,000     18,938,100
TOTAL EXPENSES                                                                     9,380,851,377 4,773,447,084   3,563,753,441 2,996,091,505
EARNINGS BEFORE INTEREST EXPENSE
AND INCOME TAX                                                                     1,342,882,438   861,886,325   1,132,115,988   903,126,138
INTEREST EXPENSE                                                                   (275,631,227) (121,656,107)   (105,573,847)   (78,441,823)
CORPORATE INCOME TAX                                                               (207,989,020) (211,974,378)   (194,433,102) (201,533,439)
EARNINGS BEFORE MINORITY INTEREST                                                   859,262,191    528,255,840    832,109,039    623,150,876
MINORITY INTEREST IN NET LOSS (EARNINGS)                                            (27,153,152)    94,895,036        -               -
NET EARNINGS FOR THE YEAR                                                           832,109,039    623,150,876    832,109,039    623,150,876


BASIC EARNINGS PER SHARE
     Net earnings                                                                           0.72          0.71            0.72            0.71


Weighted average number of ordinary shares (shares)                                1,163,410,108   875,129,812   1,163,410,108   875,129,812




The accompanying notes are an integral part of the financial statements.


66
  STATEMENTS
  OF CHANGES
  IN SHARE-
  HOLDERS'                                              BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
  EQUITY                                                AND SUBSIDIARIES
                                                        AS AT 31 DECEMBER 2005 AND 2004




                                                                                                                                                                           (Unit : Baht)

                                                                                                            CONSOLIDATED
                                                                                                                                Retained earnings

                                                            Issued and      Premium on      Revaluation     Revaluation Appropriated-
                                                                                                                                                               Minority
                                                              paid-up         ordinary        surplus      surplus on land statutory Unappropriated                              Total
                                                                                                                                                                interest
                                                           share capital       shares      on investment    and buildings   reserve

Balance - as at 1 January 2004                             750,000,000 1,567,600,000            33,110     460,438,200       59,000,000        547,313,803    341,057,062 3,725,442,175
Increase in revaluation surplus on land and buildings            -               -               -         513,558,920            -                 -               -          513,558,920
Adjustment of fair value of investment                           -               -         135,517,894          -                 -                 -               -          135,517,894
Other premium                                                    -               -               -          (5,255,604)           -              5,255,604          -              -
Increase in share capital                                  413,410,108           -               -              -                 -                 -               -          413,410,108
Increase in permium on share capital                             -         2,755,007,094         -              -                 -                 -               -        2,755,007,094
Net earnings for the year                                        -               -               -              -                 -            623,150,876          -          623,150,876
Minority interest                                                -               -               -              -                 -                -           21,322,298       21,322,298
Dividend paid (Note 19)                                          -               -               -              -                 -           (300,000,000)         -        (300,000,000)
Transfer to statutory reserve                                    -               -               -              -            31,157,544        (31,157,544)         -               -
Balance - as at 31 December 2004                         1,163,410,108 4,322,607,094       135,551,004     968,741,516       90,157,544        844,562,739    362,379,360     7,887,409,365
Transfer revaluation surplus on land and buildings               -               -               -          (4,945,028)           -                 -               -           (4,945,028)
Adjustment of fair value of investment                           -               -         119,108,738          -                 -                 -               -          119,108,738
Net earnings for the year                                        -               -               -              -                 -            832,109,039          -          832,109,039
Minority interest                                                -               -               -              -                 -                 -         165,561,180      165,561,180
Dividend paid (Note 19)                                          -               -               -              -                 -           (581,705,054)         -        (581,705,054)
Transfer to statutory reserve                                    -               -               -              -            28,183,467        (28,183,467)         -               -
Balance - as at 31 December 2005                         1,163,410,108 4,322,607,094       254,659,742     963,796,488 118,341,011         1,066,783,257      527,940,540 8,417,538,240


                                                                                                       THE COMPANY ONLY
                                                                                                                                          Retained earnings

                                                            Issued and       Premium on        Revaluation   Revaluation Appropriated-
                                                              paid-up          ordinary          surplus    surplus on land statutory  Unappropriated                            Total
                                                           share capital        shares        on investment and buildings    reserve

Balance - as at 1 January 2004                             750,000,000        1,567,600,000           33,110        460,438,200        59,000,000         547,313,803         3,384,385,113
Increase in revaluation surplus on land and buildings           -                    -                -             513,558,920           -                     -              513,558,920
Adjustment of fair value of investment                          -                    -           135,517,894             -                -                     -              135,517,894
Other Premium                                                   -                    -                -             (5,255,604)           -                   5,255,604             -
Increase in share capital                                  413,410,108               -                -                  -                -                     -              413,410,108
Increase in permium on share capital                            -             2,755,007,094           -                  -                -                     -             2,755,007,094
Net earnings for the year                                       -                    -                -                  -                -               623,150,876          623,150,876
Dividend paid (Note 19)                                         -                    -                -                  -                              (300,000,000)        (300,000,000)
Transfer to statutory reserve                                   -                    -                -                  -             31,157,544        (31,157,544)               -
Balance - as at 31 December 2004                          1,163,410,108       4,322,607,094      135,551,004        968,741,516        90,157,544         844,562,739         7,525,030,005
Transfer revaluation surplus on land and buildings              -                    -                -             (4,945,028)           -                     -               (4,945,028)
Adjustment of fair value of investment                          -                    -           119,108,738             -                -                     -              119,108,738
Net earnings for the year                                       -                    -                -                  -                -               832,109,039          832,109,039
Dividend paid (Note 19)                                         -                    -                -                  -                -             (581,705,054)        (581,705,054)
Transfer to statutory reserve                                   -                    -                -                  -             28,183,467        (28,183,467)               -
Balance - as at 31 December 2005                          1,163,410,108       4,322,607,094      254,659,742        963,796,488       118,341,011       1,066,783,257         7,889,597,700



The accompanying notes are an integral part of the financial statements.


                                                                                                                                                                                         67
 STATEMENTS
 OF                                                BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 CASH FLOWS                                        AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




Cash flows from operating activities                                                                                       (Unit : Baht)
                                                                               CONSOLIDATED                 THE COMPANY ONLY
                                                                              2005       2004                2005       2004

Net earnings                                                                832,109,039    623,150,876     832,109,039    623,150,876
Adjustments to reconcile net earnings to net cash
provided by (paid from) operating activities: -
Depreciation and amortisation                                               992,094,118    366,585,398     275,276,151    199,412,714
     Bad debts and allowance for doubtful accounts                           21,706,686     19,899,625      15,915,863       9,696,922
     Amortisation of deferred income                                        (24,388,657)   (16,383,123)    (24,388,657)   (16,383,123)
     Share of profit from investments accounted for
     under equity method                                                   (159,043,698) (222,505,847)    (334,813,148) (101,772,915)
     Minority interests in net earnings for the year                         27,153,152        -               -               -
     Loss on impairment of fixed assets                                         924,534    198,041,706         924,534       9,388,101
     Amortisation of goodwill                                                72,487,577     38,116,757         -               -
     Amortisation of deferred interest                                        9,755,095        -             3,629,851         -
     Loss (gain) on disposal of fixed assets                                 (5,712,407)     3,291,277      (1,782,842)      1,628,682
     Unrealize gain on foreign exchange rate                                    -            (789,327)         -            (789,327)
Earnings from operating activities before changes
in operating assets and liabilities                                        1,767,085,439 1,009,407,342     766,870,791    724,331,930
Decrease (increase) in operating assets
     Trade accounts receivable                                             (102,126,467) (124,245,401)     (58,827,582)   (58,670,338)
     Other receivable and short - term loans to related parites               7,593,384        -           123,260,469         -
     Inventories                                                            (34,925,236)   (18,965,041)    (27,639,226)   (14,536,339)
     Interest receivable                                                        -          118,439,930         -           34,447,128
     Other current assets                                                   (73,578,834)    41,127,408     (55,720,209)   (13,327,238)
     Other non-current asset                                                (11,074,262)     1,316,531       (389,311)       7,919,755
Increase (decrease) in operating liabilities
     Trade accounts payable                                                  91,385,510     94,555,012      34,301,528    113,425,672
     Other payable - related parties                                         (7,338,271)       -            11,227,135         -
     Corporate income tax payable                                            14,407,228     48,360,161      11,268,004     47,772,102
     Accrued expenses                                                        (2,218,325)   (68,985,827)     22,168,589    (21,166,613)
     Other current liabilities                                               42,231,908     91,866,708     (85,127,916)    58,988,484
     Deferred income                                                         48,000,000     46,800,000      48,000,000     46,800,000
     Other non-current liabilities                                           32,384,127    (10,842,052)      2,675,695     (5,893,515)
Net cash from operating activities                                         1,771,826,201 1,228,834,771     792,067,967    920,091,028



The accompanying notes are an integral part of the financial statements.


68
 STATEMENTS
 OF                                                BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 CASH FLOWS                                        AND SUBSIDIARIES
                                                   AS AT 31 DECEMBER 2005 AND 2004




Cash flows from investing activities                                                                                               (Unit : Baht)
                                                                                CONSOLIDATED                      THE COMPANY ONLY
                                                                               2005        2004                    2005        2004

     Decrease (increase) in short - term investments
     and restricted bank deposit                                               12,189,299      (10,851,270)         4,792,237        (6,045,107)
     Cash from dividend received                                               99,715,000          -               99,715,000        44,758,750
     Increase in goodwill                                                        -             (69,869,795)          -                 -
     Cash paid for purchase of investments in
     subsidiary and associated companies                                    (236,570,936)     (333,574,521)     (555,489,324)     (567,294,951)
     Cash received from sales of investment                                      -                2,840,040          -                 -
     Cash received from disposal of fixed assets                              125,925,110         9,177,272         4,185,329         3,899,326
     Cash paid for purchase of fixed assets                                (2,728,263,072)   (1,504,158,903)   (1,546,697,309)    (957,538,036)
     Decrease in loans to and interest receivable
     from related parties                                                     102,647,061       265,636,822       115,164,402       177,522,904
     Increase in intangible assets                                           (25,115,340)          -             (10,971,427)          -
     Decrease in account receivables from
     disposal of fixed assets                                                    -                1,229,150          -                7,755,000
Net cash used in investing activities                                      (2,649,472,878)   (1,639,571,205)   (1,889,301,092)   (1,296,942,114)


Cash flows from financing activities
     Increase (decrease) in bank overdraft and
     short-term loans from financial institutions                             267,710,806     (417,277,899)       180,000,000     (176,349,000)
     Increase (decrease) in short-term loans from
     related parties                                                           10,000,000      (24,535,115)          -                 (48,660)
     Decrease in subcription receivables of
     subsidiary company                                                          -               16,951,150          -                 -
     Increase in long-term loan                                             1,335,073,474          -            1,166,505,600          -
     Decrease in financial lease                                            (107,813,839)          -             (31,315,588)          -
     Increase in other long - term liabilities                                   -              477,400,000          -                 -
     Repayment of long-term liabilities                                     (484,012,426)     (349,684,572)     (284,936,607)     (302,688,319)
     Dividend paid                                                          (581,705,054)     (300,000,000)     (581,705,054)     (300,000,000)
     Cash received from increase of share capital                                -            1,500,000,000          -            1,500,000,000
     Increase (decrease) in minority interests                               (71,220,708)        21,322,298          -                 -
Net cash from financing activities                                            368,032,253       924,175,862       448,548,351       720,914,021
Net increase (decrease) in cash and cash equivalents                        (509,614,424)       513,439,428     (648,684,774)       344,062,935
Cash and cash equivalents at beginning of year                              1,038,564,334       525,124,906       749,445,142       405,382,207
Cash and cash equivalents at end of year                                      528,949,910     1,038,564,334       100,760,368       749,445,142


Supplemental cash flows information cash paid during the year for :-
     Interest expense                                                         285,061,568       123,287,420       104,787,426        72,742,046
     Corporate income tax                                                     232,609,749       170,838,499       183,344,203       153,665,286
Non-cash items :-
     Fixed assets under financial lease and
     hire-purchase agreements                                                 135,503,658        98,896,000        60,000,000        27,743,919



The accompanying notes are an integral part of the financial statements.


                                                                                                                                              69
 Note to
 Financial                              BANGKOK DUSIT MEDICAL SERVICES PUBLIC COMPANY LIMITED
 Statements                             AND SUBSIDIARIES




1. GENERAL INFORMATION

   Bangkok Dusit Medical Services Public Company Limited was incorporated as a limited company under Thai laws
and registered the change of the status of the Company to a public limited company on 3 January 1994. The Company
operates in Thailand and its principal activity is hospital with the registered office being located at 2, Soi Soonvijai 7,
New Petchburi Road Bang Kapi Huaykwang, Bangkok.


2. BASIS OF CONSOLIDATION

     2.1 The consolidated financial statements include the financial statements for the years ended 31 December 2005
and 2004 of Bangkok Dusit Medical Services Public Company Limited (herein after called "the Company") and its
subsidiaries (herein after called "the subsidiaries") which were incorporated in Thailand except B.D.M.S. International
Medical Services Co., Ltd. which was incorporated in Cambodia as follows :-

                                                                                                              Percentage of
                                                                                                             shareholding by
Subsidiary companies                          Type of business           Registered capital              the Company (percent)
                                                                       2005               2004             2005        2004

Held by the Company
Bangkok Prapradang Hospital Co., Ltd.           Hospital           105 million Baht   105 million Baht      79           79
National Healthcare Systems Co., Ltd.           Central lab         75 million Baht    75 million Baht      74           74
Bio Molecular Laboratories                      Central lab         10 million Baht    10 million Baht      95           95
     (Thailand) Co., Ltd.
Bangkok Rayong Hospital Co., Ltd.               Hospital           400 million Baht   400 million Baht      81           81
New Petchburi Medical Services Co., Ltd.        Hospital             1 million Baht     1 million Baht      100         100
Bangkok Samui Hospital Co., Ltd.                Hospital           150 million Baht   150 million Baht      100         100
Bangkok Hatyai Hospital Co., Ltd.               Hospital           500 million Baht   500 million Baht      99           99
Bangkok Trat Hospital Co., Ltd.                 Hospital           200 million Baht   200 million Baht      63           63
Bangkok Phuket Hospital Co., Ltd.               Hospital           500 million Baht   500 million Baht      99           99
BNH Medical Center Co., Ltd.                    Hospital           586 million Baht         -               88           -
Wattanavej Co., Ltd.                            Hospital           180 million Baht         -               62           -
Bangkok Helicopter Services Co., Ltd.           Services            30 million Baht         -               100          -
B.D.M.S. International Medical                  Hospital         9,200 million Baht         -               100          -
     Services Co., Ltd.
Samitivej Public Co., Ltd.                      Hospital         1,000 million Baht 1,000 million Baht      93           93




70
                                                                                                                           Percentage of
                                                                                                                          shareholding by
Subsidiary companies                                Type of business                Registered capital                the Company (percent)
                                                                                   2005              2004                   2005    2004

Held by the Company
Irving Sheridan SE Co., Ltd.                  Management assets                           0.1                0.1
    (held by a subsidiary at 95%)             for health care business            million Baht       million Baht            -           -
First Health Food Co., Ltd.                   Restaurant and                               14                7.1
    (held by a subsidiary at 100%)            distributing health                 million Baht       million Baht            -           -
Phuket Health And Travel Co., Ltd.            food products
    (held by a subsidiary at 100%)            Healthcare travel                             5                  5
                                              service                             million Baht       million Baht            -           -
Sodexho Healthcare Support Services           Restaurant and
Thailand Ltd.                                 distributing health                          15                7.5
    (held by a subsidiary at 74%)             food products                       million Baht       million Baht            -           -


   2.2 Percentage of total assets and revenues of the subsidiary company to the consolidated financial statements
The percentage of total assets and revenues of the subsidiary company for the years ended 31 December 2005 and
2004 to the consolidated financial statements are as follow :-

                                                                                                               Subsidiary’s total revenues
                                                                         Subsidiary’s total assets                from patient service
                                                                            as a percentage to                       as a percentage
                                                                          the consolidated total                to the consolidated total
                                                                           2005              2004                   2005           2004

Subsidiaries
Bangkok Prapradang Hospital Co., Ltd.                                      1.00              1.40                    1.31           3.6
National Healthcare Systems Co., Ltd.                                      0.70              0.82                    0.42           1.3
Bio Molecular Laboratories (Thailand) Co., Ltd.                            0.16              0.18                    0.23           0.3
Bangkok Rayong Hospital Co., Ltd.                                          4.73              5.28                    4.63           6.3
New Petchburi Medical Services Co., Ltd.                                   0.01              0.81                     -              -
Bangkok Samui Hospital Co., Ltd.                                           1.68              2.01                    1.56           1.0
Bangkok Hatyai Hospital Co., Ltd.                                          6.43              7.49                    5.27           8.5
Bangkok Trat Hospital Co., Ltd.                                            2.06              2.27                    1.41           2.4
Bangkok Phuket Hospital Co., Ltd.                                          4.96              6.17                    7.68           7.0
BNH Medical Center Co., Ltd.                                               6.66                  -                   7.03            -
Wattanavej Co., Ltd.                                                       3.79                  -                   2.05            -
Bangkok Helicopter Services Co., Ltd.                                      0.19                  -                    -              -
B.D.M.S. International Medical Services Co., Ltd.                          0.53                  -                    -              -
Samitivej Public Co., Ltd.                                                27.61             31.79                   27.08            -




                                                                                                                                             71
   2.3 Intercompany balances and significant intercompany transactions between the Company and its subsidiaries are
eliminated from the consolidated financial statements.


   2.4 The differences between cost of investments over/under the fair value of identifiable assets and liabilities of the
subsidiary company to the extent of the Company's portion on acquisition date are shown under the caption of
"Goodwill/negative goodwill" in the consolidated balance sheets and subject to amortisation over the period of 10 - 20 years.


   2.5 Results of operations of the subsidiary companies have been included in the consolidated financial statements
from their effective dates of acquisition of the investment.


3. SIGNIFICANT ACCOUNTING POLICIES

   The financial statements have been prepared in accordance with accounting standards enunciated under under the
Accounting Profession Act B.E. 2547.


   3.1 Revenue and expense recognition
   Revenues from hospital operations, mainly consisting of medical fees, hospital room sales, and medicine sales, are
recognized as income when services have been rendered or medicine delivered.


   Revenue from sales of food and beverages are recognised when food and beverages have been delivered.


   Interest income, other income and expenses are recognized on an accrual basis.


   3.2 Cash and cash equivalents
   Cash and cash equivalents consist of cash in hand and at financial institutions with an original maturity of three
months or less and are free from restrictions.


   3.3 Trade accounts receivable and allowance for doubtful accounts
   Trade accounts receivable are stated at the net realizable value. Allowance for doubtful accounts is provided to cover
the estimated losses that may incur in collection. The adequacy of the allowance is reviewed and evaluated in relation
to the collection experience, age of debt and payment ability. Debt will be written off when considered uncollectible.


   3.4 Inventories
   Inventories are valued at lower of cost (weighted average basis) and net realisable value. Net realizable value is the
estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale.


   3.5 Investments
   Investments in subsidiary companies (in the Company's financial statements) and associated companies are stated
under the equity method




72
   Other investments in non-marketable securities which the Company regards as other investment are stated at
cost. Allowance for impairment loss will be made when the net realizable value is lower than the cost of investments.


   Investment in available for sales securities is determined at fair value, which is based on the latest bid price quoted
on the Stock Exchange of Thailand on the last working day of the year. Change in the value of the available for sales
securities is shown as a separate item in shareholder's equity as revaluation surplus on investments until securities are
sold, the change will be included in determining earnings.


   3.6 Property, plant and equipment and depreciation
   Land is stated at cost or revalued amount. Plant and equipment are stated at cost or revalued amount less
accumulated depreciation and provision for impairment. Depreciation of plant and equipment is calculated by reference
to their cost or revalued amount on a straight-line basis over the estimated useful lives of each item of property plant
equipment, except assets of the Company which were acquired before 1988 are depreciated on a declining balance
method.


   The estimated useful lives of assets are as follows :-


     Building, structures and building improvements                               5 - 50 years
     Medical tools and equipment, furniture and office equipment                  3 - 10 years
     Vehicles                                                                     5 - 8 years


   No depreciation is provided on land and fixed assets under construction and installation.


Revalued assets
   The Company and the subsidiary companies initially recorded land and buildings at cost on acquisition dates.
Land and buildings are subsequently revalued by independent professional valuer, to their fair values. Revaluations
are made with sufficient regularity to ensure that their carrying amounts do not differ materially from their fair value
at the balance sheet date.


   The Company and subsidiary companies records the differences incurred from revaluation as follows :-
   • When an asset's carrying amount is increased as a result of a revaluation, the increase should be credited directly
to equity under the heading of "Surplus on revaluation of land and buildings". However, a revaluation increase should
be recognised as income to the extent that it reverses a revaluation decrease of the same asset previously recognised
as an expense.


   • When an asset's carrying amount is decreased as a result of a revaluation, the decrease should be recognised as an
expense in the earnings statement. However, a revaluation decrease should be charged directly against any related
"Surplus on revaluation of land and buildings" to the extent that the decrease does not exceed the amount held in the
revaluation surplus in respect of that same asset and the excess is recognised an expense in the earnings statement.




                                                                                                                       73
   During the year 2005, a subsidiary company used accounting policy related to the recording of the revaluation
surplus on land and building, by being transferred through the earnings statements, as pemitted under the Institute of
Certified Accountants and Auditors of Thailand ("ICAAT")'s announcement No. 006/2544-2546.


   Nevertheless, the ICAAT announcement is effective until 2006 and the subsidiary will again have to comply with
Accounting Standard No. 32 which requires such revaluation surplus to be transferred directly to retained earnings as
from 1 January 2007. The subsidiary has to retroactively restate all presented comparative figures when it changes its
accounting policy.


   3.7 Hire-purchase and financial lease agreements
   The Company and its subsidiary companies record medical tools and vehicles under hire-purchase and financial
lease agreements as assets and liabilities in the balance sheet at amount equal to the fair value of such assets at the inception
of the agreements or, if lower, at the present value of the minimum payments. In calculating the present value of the
minimum payments, the discount factor used is the interest rate implicit in the agreements. The interest charge is
recorded over the contract period based on the remaining balance of the liabilities for each period.


   3.8 Other intangible assets and amortization
   Other intangible assets, mainly leasehold right and computer software, are stated at cost less accumulated amortisation
and provision for impairment. The Company and the subsidiary companies amortise intangible assets on a straight-line
method over the period of 5 - 10 years or based on the period in the agreement and the amortisation is included in the
earnings statement.


   3.9 Operating lease
Lease of assets where a significant portion of the risks and rewards of ownership are retained by the lessor are classified
as operating leases. Payments made under operating leases are recognized as expenses in the statements of earnings
over the period of the lease.


   3.10 Impairment of assets
   The Company and its subsidiary companies review the impairment of assets whenever events indicate that carrying
value of an asset exceeds its recoverable amount or fair value (the higher of an assets net selling price or value in use).
The review is made for individual assets or for the cash generating unit, as the case may be.


   The Company and its subsidiary companies recognises an impairment loss in the statements of earnings whenever
the book value of an asset exceeds its recoverable amount. The Company and its subsidiary companies will reverse
the impairment loss whenever there is any indication that an impairment loss recognized may no longer exist or may
have decreased.



   3.11 Deferred income
   Deferred income represents payments from Life Privilege holders and is amortized over 10 years.




74
   3.12 Foreign currencies
   Transactions in foreign currencies incurred during the year are translated into Baht at the rates ruling on the
transaction dates. Monetary assets and liabilities denominated in foreign currency outstanding at the balance sheet
date are translated into Baht at the rates ruling on the balance sheet date. Exchange gains and losses are included in
determining earnings.


   3.13 Financial instruments
   Financial instruments presented in the balance sheets consist of cash and cash at bank, short-term investments,
accounts receivable, accounts payable, loans and borrowings. The accounting policy is separately disclosed in the
related notes.


   The Company and its subsidiary companies have no policy to engage in any off balance sheet derivative financial
instruments for speculative or trading purpose.


   3.14 Corporate income tax
   Corporate income tax has been calculated on the earnings before income tax, after adding back certain provisions
for expenses which are disallowable for tax computation purposes, deducting accumulated tax loss brought forward
from previous year (if any) and excluding share of profit (loss) from investments accounted for under equity method
and dividend received from subsidiaries.


   3.15 Earnings per share
   Earnings per share as presented in the statements of earnings is the basic earnings per share which is determined by
dividing the net earnings for the year by the weighted average number of ordinary shares in issue during the year.


   3.16 Use of accounting estimates
   Preparation of financial statements in conformity with generally accepted accounting principles requires management
to make estimates for certain accounting transactions, affecting amounts reported in the financial statements and notes
thereto. Subsequent actual results may differ from these estimates.


4. CASH AND CASH EQUIVALENTS

   Cash and cash equivalents for the years ended 31 December 2005 and 2004, consist of the following :

                                                                                                             (Unit : Baht)

                                                               Consolidated                   The Company only
                                                            2005              2004            2005             2004

Cash and deposit at banks                                 449,604,359   1,070,504,016      108,208,386     760,214,316

Fixed deposit                                             100,701,257         1,471,081         -            1,471,081

                                                          550,305,616   1,071,975,097      108,208,386     761,685,397

Less : Fixed deposits more than 3 months and

  restricted bank deposit                                (21,355,706)    (33,410,763)       (7,448,018)   (12,240,255)

Cash and cash equivalents                                 528,949,910   1,038,564,334      100,760,368     749,445,142




                                                                                                                      75
5. RESTRICTED BANK DEPOSIT

   As at 31 December 2005, the Company and its subsidiaries had placed their fixed deposits at bank over 3 months
and savings account of Baht 20.6 million and the Company only of Baht 7.4 million (2004 : Baht 14.9 million and the
Company only of Baht 6.0 million respectively) as a collateral against bank guarantees as discussed in Note 25 to the
financial statements.


6. TRADE ACCOUNTS RECEIVABLE

   As at 31 December 2005 and 2004, the aging analysis of the outstanding trade accounts receivable is as follows :-


                                                                                                     (Unit : Thousand Baht)

                                                               Consolidated                  The Company Only
                                                            2005              2004           2005               2004

  Related parties
      • Less than 3 months                                  13,288            13,815          4,284              4,838
      • 3 - 6 months                                            57             1,516            115                218
      • 6 - 12 months                                          231              185              83                 50
      • over 12 months                                         391               16              -                  16
  Total accounts receivable - related parties               13,967            15,532          4,482              5,122


  Others
      • Less than 3 months                                 521,675        376,421           212,850           155,127
      • 3 - 6 months                                        31,969            36,036         13,504             15,109
      • 6 - 12 months                                       14,443            20,112          7,291              9,454
      • over 12 months                                      16,721            26,490          8,897             19,300
  Total accounts receivable - others                       584,808        459,059           242,542           198,990
  Less : Allowance for doubtful accounts                  (34,360)        (35,017)          (20,924)          (20,924)
  Total trade accounts receivable                          550,448        424,042           221,618           178,066
  Total trade accounts receivable -net                     564,415        439,574           226,100           183,188




7. RELATED PARTY TRANSACTIONS

   During the years, the Company had significant business transactions with its subsidiaries (eliminated from the
consolidated financial statements) and with its related companies (related by way of shareholding, common shareholders
and/or common directors). Such transactions which mainly consisted of revenue from hospital, loans, administration
and purchase of fixed assets have been concluded on the terms and basis agreed between the Company and those
companies, with the pricing policies as follow : -




76
Transaction                                            Pricing and lending policy

Revenue from hospital operation                        Prices are based on the price charged to normal customers

Revenue from lab analysis service                      Prices are based on the price charged to normal customers

Revenue from consulting and management                 Agreed prices and in accordance with normal course of business

Interest rate charge of inter-company loan             Interest rate is close to rate charged by bank to normal customer

Sales and purchase of fixed assets                     Agreed prices and in accordance with normal course of business




   The significant intercompany transactions are as follows :-


                                                                                                                    (Unit : Baht)

                                                                       Consolidated                 The Company Only
                                                                 2005                 2004          2005              2004

Transactions with subsidiaries

    (eliminated from the consolidated financial statements)

Patient services income and lab services                           -                   -           4,907,174           796,718

Consulting and management fees income                              -                   -           5,546,578         5,962,435

Interest income                                                    -                   -           4,539,411         7,110,840

Gain on sales of fixed assets                                      -                   -             395,665           716,912

Dividend income                                                    -                   -              -              2,073,750

Other income                                                       -                   -          26,855,260         9,621,174

Service cost                                                       -                   -        117,118,326        119,231,317

Other expenses                                                     -                   -           3,603,631         2,802,798

Purchase of investments in common shares                           -                   -              -         1,843,292,244

Purchase of medical instruments                                    -                   -          38,200,000            -

Purchase of building and structure                                 -                   -        127,000,000             -




                                                                                                                             77
                                                                                                             (Unit : Baht)

                                                              Consolidated                The Company Only
                                                         2005                 2004        2005                  2004

Transactions with associated companies
Patient services income and lab services               12,563,019       82,131,482       5,756,022           3,462,348
Consulting and management fees income                   6,643,266       35,697,244       1,818,854           7,690,261
Interest income                                          203,099        12,276,397        203,099          11,646,617
Dividend income                                        99,715,000       42,688,768      99,715,000         42,685,000
Other income                                            4,908,963        7,821,598       4,370,061           3,370,519
Service cost                                           18,759,264       40,222,240      17,229,408         33,176,320
Interest expense                                              -              545,955           -                  -
Other expenses                                           220,216        11,680,762             4,440         1,843,658
Dividend payment                                       17,632,362       11,395,260      17,632,362         11,395,260
Purchase of investments in common shares              134,958,100       49,505,060     134,958,100         49,505,060


Transactions with related parties
Patient services income and lab services                7,088,331        9,179,673       7,073,031           9,179,673
Interest expense                                              -              450,000           -               450,000
Other expenses                                          4,162,000             42,295     4,162,000              42,295
Dividend payment                                        5,642,962       32,796,900       5,642,962         32,796,900




   The outstanding balances of the above transactions have been separately shown in the balance sheets,
as follows :-



                                                                                                   (Unit : Thousand Baht)

                                                              Consolidated                The Company Only
                                                         2005                2004        2005                 2004

  Trade accounts receivable - related parties
  Subsidiary companies                                    -                   -           1,369                  523
  Associated companies                                   5,775           10,328           2,056                  809
  Related companies                                      8,192               5,204        1,057                3,790
  Total trade accounts receivable - related parties     13,967           15,532           4,482                5,122


  Other receivable - related parties
  Consulting and management fee receivable
  Subsidiary companies                                    -                   -          15,760                  330
  Associated companies                                    -                  8,395         -                   8,395
  Total                                                   -                  8,395       15,760                8,725




78
                                                                                       (Unit : Thousand Baht)

                                                       Consolidated            The Company Only
                                                 2005                 2004    2005                2004

Other
Subsidiary companies                               -                   -       2,977               1,784
Associated companies                              2,797               1,995     152                1,641
Total                                             2,797               1,995    3,129               3,425
Total other receivable - related parties          2,797           10,390      18,889              12,150


Short-term loans to related parties
Subsidiary companies
New Petchburi Medical Services Co., Ltd.           -                   -        -               115,000
Bangkok Prapradang Hospital Co., Ltd.              -                   -        -                 15,000
Total short-term loans to related parties          -                   -        -               130,000




                                                                                       (Unit : Thousand Baht)

                                                       Consolidated            The Company Only
                                                 2005                 2004    2005                2004

Long-term loans to related parties
Subsidiary company
Bangkok Prapradang Hospital Co., Ltd.              -                   -       1,201              1,201
Associated company
Bangkok Pattaya Hospital Co., Ltd.                 -              80,258        -                17,280
Total long-term loans to related parties           -              80,258       1,201             18,481


Interest receivable - related parties
Subsidiary companies                               -                   -      77,606           157,607
Associated companies                             15,393           37,782      15,393             33,277
Total interest receivable - related parties      15,393           37,782      92,999           190,884


Short-term loans from related party
Associated company
The Medic Pharma Co., Ltd.                       10,000                -        -                   -
Total short-term loans from related party        10,000                -        -                   -


Trade accounts payable - related parties
Subsidiary companies                               -                   -       4,582             10,949
Associated companies                             16,098               5,023    2,753              2,525
Related companies                                  664                 240      -                   240
Total trade accounts payable - related parties   16,762               5,263    7,335             13,714




                                                                                                           79
                                                                                                              (Unit : Thousand Baht)

                                                                Consolidated                         The Company Only
                                                         2005                  2004              2005                    2004

Other payable - related parties
Subsidiary companies                                        -                    -              11,906                      378
Associated companies                                      3,879                  -                    -                     100
Related companies                                         3,358                 4,401                 -                     200
Related persons                                           4,790                 4,790            4,790                    4,790
Total other payable - related parties                    12,027                 9,191           16,696                    5,468




   Movement of loans to and loans from related parties during the year are summarized as follow:-
                                                                                                              (Unit : Thousand Baht)

                                                                                      Consolidated
                                                    31 December 2004       Increase             Decrease           31 December 2005

Long-term loan to related parties
Associated company
Bangkok Pattaya Hospital                                 80,258                  -               80,258                    -
                                                         80,258                  -               80,258                    -


Short-term loans from related party
Associated company
The Medic Pharma Co., Ltd.                                 -                   10,000                     -             10,000
                                                           -                   10,000                     -             10,000



                                                                                                              (Unit : Thousand Baht)

                                                                                 The Company Only
                                                    31 December 2004       Increase             Decrease           31 December 2005

Short-term loan to related parties
Subsidiary companies
New Petchaburi Medical Services Co., Ltd.               115,000                  -              115,000                    -
Bangkok Prapadang Hospital Co., Ltd.                     15,000                  -               15,000                    -
                                                        130,000                  -              130,000                    -


Long-term loan to related parties
Subsidiary company
Bangkok Prapadang Hospital Co., Ltd.                      1,201                  -                        -               1,201
Associated company
Bangkok Pattaya Hospital Co., Ltd.                       17,280                  -               17,280                    -
                                                         18,481                  -               17,280                   1,201




80
   The Company charges interest on loans to subsidiary and associated companies at the interest rate actually paid
by the Company plus 0.25-0.50% per annum, MLR+1-2% per annum, MLR-1% per annum, and fixed rate of 4%,
4.25%, 4.5%, 5% and 7% per annum.


   Bangkok Phuket Hospital Co., Ltd. has an interest payable to the Company totalling Baht 4 million which it will
repay in two equal installments, in December 2009 and December 2010.


   Bangkok Phuket Hospital Co., Ltd. has mortgaged its land, building and construction to be erected in the future as
collateral security against the loan.


   As at 31 December 2005, the Company had long overdue loan interest receivable from Bangkok Hatyai Hospital
Co., Ltd. of Baht 83.19 million (2004 : Baht 83.19 million). The Company has provided allowance for doubtful accounts
of Baht 9.58 million (2004 : Baht 9.58 million). The management believes that the allowance for doubtful accounts
will be sufficient in respect of these loans because the Company expects that the outstanding balance will be collected
and the subsidiary has pledged its land as collateral for the loan.


Management Agreement
The Company
   The Company has entered into the Hospital Managing Employment Agreement with B.N.H. Medical Centre
Limited, a subsidiary company, for a period of five years. The agreement is renewable. Remuneration rates for the
1st - 5th years are 2.5% - 5% gross margin before interest expense, income tax, depreciation, and amortization of
deferred expense per annum, and these rates rise to 8% per annum from the 6th year onward.


   The employer requests to suspend the management remuneration of the 1st - 5th years until the 6th year.


The Subsidiary
   The subsidiary company has entered into a Hospital Managing Employment Agreement with an associated company
for a period of ten years and is entitled to renew this agreement. The subsidiary company shall receive remuneration
at the certain percentage of total operation result as stated in the agreement. The payment shall be made on a monthly
basis, starting in September 2002.


Long Term Agreement
The Subsidiary
   On 5 June 2003, the subsidiary company entered into the 3-year land lease agreement with another subsidiary
company for building construction. That subsidiary company has to pay a monthly rental fee at Baht 100,000,
commencing from 1 January 2004.


   In 2005, the subsidiary company entered into the 3-year building rental agreement with another subsidiary
company for the hospital operation. That subsidiary company has to pay a monthly rental fee Baht 1,000,000,
commencing from May 2005.




                                                                                                                    81
8. INVENTORIES

   As at 31 December 2005 and 2004, inventories consisted of :-
                                                                                                                                                         (Unit : Baht)

                                                                                             Consolidated                             The Company Only
                                                                                       2005                 2004                      2005                    2004

Drugs and supplies                                                              134,225,375              98,700,041             55,121,268              35,388,089
Medical supplies and others                                                          17,683,268           8,930,075             14,883,696               6,977,649
Reagent                                                                               8,952,836           7,771,567                       -                    -
Total                                                                           160,861,479             115,401,683             70,004,964              42,365,738




9. INVESTMENTS IN SUBSIDIARY AND ASSOCIATED COMPANIES
ACCOUNTED FOR UNDER EQUITY METHOD / EXCESS OF LOSS OVER
COST OF INVESTMENT IN SUBSIDIARY COMPANY ACCOUNTED
FOR UNDER EQUITY METHOD
                                                                                                                                              (Unit : Thousand Baht)
                                                                   Paid-up
           Company name                     Type of business        Capital           % Shareholding                    Investments                      Dividends

                                                                                                          Cost Method           Equity Method
                                                                                       2005     2004     2005       2004         2005         2004      2005       2004
Associated companies

Associated companies held by

the Company

Bangkok Pattaya Hospital Co., Ltd.          Hospital             280 million Baht      49.00    49.00    223,489    223,489     432,908       396,939   96,040     34,300

Wattanavej Co.,Ltd.                         Hospital             120 million Baht        -      48.00        -      132,480           -       175,032     -          5,760

The Medic Pharma Co., Ltd.                  Pharmaceutical       21.4 million Baht     49.00    49.00     52,500     52,500      69,413        66,931    3,675       2,625

BNH Medical Center Co., Ltd.                Hospital             586 million Baht        -      48.45        -      284,000           -       291,743     -           -

Cool & Joy Co., Ltd.                        Production of          5 million Baht      30.00    30.00       1,500     1,500           567        566      -           -
                                            Television and
                                            Radio Program

S.R. Property Investment Co., Ltd.          Real estate            20 million Riel     49.00      -          101         -            101        -        -           -

Total investments in associated
companies held by the Company                                                                            277,590    693,969     502,989       931,211   99,715     42,685



Accociated companies held by the
subsidiary company

Samitivej Sriracha Co., Ltd. (Formerly
known as "Ruampat Sriracha Co., Ltd.")      Hospital             188 million Baht      30.00    30.00     56,253     56,253      72,091        55,999     -           -

Sodexho Support Services (Thailand) Ltd.    Management service     5 million Baht      26.00    26.00       1,300     1,300           999       1,288     -           -

Total investments in associated
companies of the subsidiary company                                                                       57,553     57,553      73,090        57,287     -           -

Total investments in associated companies
accounted for under equity method in
consolidated financial statement                                                                         335,143    751,522     576,079       988,498




82
                                                                                                                                       (Unit : Thousand Baht)
                                              Type of           Paid-up
            Company name                      business           Capital       % Shareholding                    Investments                       Dividends
                                                                                                   Cost Method              Equity Method
                                                                                2005    2004       2005       2004           2005      2004      2005     2004
 Subsidiary companies
 Bangkok Prapadang Hospital Co., Ltd.        Hospital      105 million Baht     79.00    79.00     96,775      96,775       112,415    128,565     -       2,074
 National Healthcare Systems Co., Ltd.      Central Lab     75 million Baht     74.02    74.02     56,768      56,768        81,992     75,327     -           -
 Bio Molecular Laboratories
      (Thailand) Co., Ltd.                  Central Lab     10 million Baht     95.00    95.00      9,502        9,502       19,807     15,761     -           -
 Bangkok Rayong Hospital Co., Ltd.           Hospital      400 million Baht     81.00    81.00    323,288     323,288       355,654    328,629     -           -
 New Petchburi Medical Services Co., Ltd.    Hospital         1 million Baht   100.00   100.00        999            999     (2,853)   (2,620)     -           -
 Bangkok Hatyai Hospital Co., Ltd.           Hospital      500 million Baht     98.53    98.53    572,465     572,465       750,749    717,930     -           -
 Bangkok Trat Hospital Co., Ltd.             Hospital      200 million Baht     63.35    63.35    122,897     122,897       125,528    125,434     -           -
 Bangkok Samui Hospital Co., Ltd.            Hospital      150 million Baht    100.00   100.00    150,000     150,000       133,369    133,055     -           -
 Bangkok Phuket Hospital Co., Ltd.           Hospital      500 million Baht     99.47    99.47    607,014     607,014       562,088    517,583     -           -
 Samitivej Public Co., Ltd.                  Hospital     1,000 million Baht    92.92    92.92   1,453,948   1,453,948 2,008,568 1,949,301         -           -
 BNH Medical Center Co., Ltd.                Hospital      586 million Baht     87.57     -       576,325        -          588,789      -         -           -
 Wattanavej Co., Ltd.                        Hospital      180 million Baht     61.99     -       267,438        -          338,669      -         -           -
 Bangkok Helicopter Services Co., Ltd.       Hospital       30 million Baht    100.00     -        33,843        -           33,847      -         -           -
 B.D.M.S. International Medical
 Services Co., Ltd.                          Hospital     9,200 million Riel   100.00     -        94,208        -           94,208      -         -           -
 Total investments in
      subsidiary companies                                                                       4,365,470   3,393,656 5,202,830 3,988,965         -       2,074
 Total investments in subsidiary and
      associated companies accounted
      for under equity method in the
      Company's financial statement                                                              4,643,060   4,087,625 5,705,819 4,920,176       99,715   44,759
 Presented as :
 Investments in subsidiary and
      associated companies accounted
      for under equity method                                                                                              5,708,672 4,922,796
 Excess of loss over cost of
      investment in subsidiary company
      accounted for under equity method                                                                                      (2,853)   (2,620)
                                                                                                                           5,705,819 4,920,176




    As at 31 December 2005 and 2004, accumulated share of loss of New Petchaburi Medical Services Co., Ltd. exceeded
the cost of investment. The Company therefore recorded such excess as liabilities under the caption of "Excess of loss
over cost of investment in subsidiary company accounted for under equity method" in other non-current liabilities in
the balance sheets.


    The calculation of investment under the equity method as at 31 December 2005 and share of profit from investment
in some associated companies for the year ended 31 December 2005 of Baht 7 million, or equivalent to 0.8 percent of
net earnings for the period, was based on financial statements prepared by the associated companies and have not yet
been audited by their auditors.




                                                                                                                                                            83
Investments in associated companies which change the status to be subsidiary companies
   In April 2005, the Company purchased additional investments of 7.62 million shares at Baht 12.25 per share totally
Baht 93.35 million in BNH Medical Center Co., Ltd. from the former shareholders. As a result, the Company increases
the percentage of share holding in that Company from 48.45 percent to 61.45 percent and that company changes the
status from an associated company to be a subsidiary company.


   In June 2005, the Company purchased additional investment in BNH Medical Center Co., Ltd. from former
shareholders of 15.3 million shares at Baht 13 per share totally Baht 198.98 million and the percentage of shareholding
increases to 87.57 percent.


   In June 2005, the Company purchased additional investment from the former shareholders of Wattanavej Co., Ltd.
of 5.40 million shares at Baht 25 per share totally Baht 135 million. As a result the Company increases the percentage
of share holding in that company from 48 percent to 61.99 percent and that company changes the status from an
associated company to be a subsidiary company.


New investments
   In June 2005, the Company purchased all shares of Bangkok Helicopter Services Co., Ltd. (formerly known as
Thai Cougar Helicopter and Petrolium Services Co., Ltd.) which consist of 0.75 million shares at Baht 7.63 per share
totally Baht 5.7 million. Subsequently, the subsidiary has increases its share capital from Baht 7.5 million (consist of
750,000 ordinary shares as at Baht 10 per share, paid up Baht 2.5 per share) to Baht 30 million which the Company
subscribed all of the shares.


   In December 2005, the Company invested in S.R. Property Investment Co., Ltd. which was registered under the law
of Combodia of RIEL 20 million total investment was RIEL 9.8 million or Baht 0.1 million and the percentage of
holding is 49 percent.


   In December 2005, the Company invested in of B.D.M.S. International Medical Services Co., Ltd. which was
registered under the law of Cambodia of RIEL 9,200 million or approximately Baht 94 million and the percentage of
holding is 100 percent.


Capital increase of a subsidiary company which is held by a subsidiary company
   During the second quarter of 2005, First Health Food Company Limited, a subsidiary company of Samitivej Public
Co., Ltd., increased its registered capital by issuing additional ordinary shares totaling 690,000 shares with par value of
Baht 10 and offered all shares to the existing shareholders. Therefore, the registered capital increased from Baht
7,100,000 to Baht 14,000,000 and the subsidiary company had already paid the subscription for share capital increase
of subsidiary company in the year 2005.


   During the second quarter of 2005, Sodexho Healthcare Support Services (Thailand) Limited, a subsidiary company
of First Health Food Company Limited, increased its registered capital by issuing additional ordinary shares totaling
75,000 shares with par value of Baht 100 and offered to the existing shareholders in proportion to the shares held by
them, called for the payment of Baht 100 per share. Therefore the registered capital




84
increased from 75,000 shares to 150,000 shares with par value of Baht 100 totaling Baht 15,000,000. First Health Food
Company Limited subscribed the capital increase in according to the entitlement of shares of 55,497 shares with par
value of Baht 100 totaling Baht 5,549,700 so after the capital increase, First Health Food Company Limited had 110,994
ordinary shares with par value of Baht 100 totaling Baht 11,099,400, representing 73.996 percent of share capital of
that company.


10. OTHER LONG-TERM INVESTMENTS

                                                                                                      (Unit : Thousand Baht)
                                                                          Paid-up capital   % share        Investment
       Company name                                   Type or business
                                                                          (Million Baht)    holding           (cost)
                                                                                                         2005         2004
Other companies held by the Company
Investments in marketable securities
Ramkhamhaeng Hospital Public Co., Ltd.                Hospital                    120          19      342,915       342,915
Thai Military Bank Public Co., Ltd.                   Bank                   133,143           -          1,770        1,770
Krungdhon Hospital Public Co., Ltd.                   Hospital                    150        0.13           208         208
Eakchon Hospital Public Co., Ltd.                     Hospital                    125         0.2           350         350
                                                                                                       345,243       345,243
Add : Revaluation surplus on investments                                                               254,659       135,550
Investments in marketable securities                                                                   599,902       480,793


Investments in other companies
X-Ray Computer Urupong Co., Ltd.                      X-ray lab                    80        5.11         4,520        4,520
Computer Center Co., Ltd.                                                          -           -                25       25
Phyathai X-ray Co., Ltd.                              Rental of medical
                                                      instrument                  130          -                 3           3
Winstore Co., Ltd.                                    Retail and wholesale        142        0.36           226         226
Thai Longstay Management Co., Ltd.                    Travel business              25        2.12           531         531
Truste Allergy Co., Ltd.                                                           -           -            -          1,249
                                                                                                          5,305        6,554
Less : Allowance for impairment of investments                                                            (254)      (1,503)
Investments in other companies-net                                                                        5,051        5,051
Other long-term investments - net
    (in the Company's financial statement)                                                             604,953       485,844
Other company held by the subsidiary company
Thai Herbal Products Co., Ltd.                        Sales of herbal              80         0.6           290         290

                                                      products
Less : Allowance for impairment of investments                                                             (66)         (66)
Investment in other companies - net                                                                         224         224
Other long-term investment - net (Consolidated)                                                        605,177       486,068




                                                                                                                         85
11. OTHER INVESTMENTS                                                                                             (Unit : Thousand Baht)

                                                                                                                       (Unit : Thousand Baht)

                                          Type of           Paid up           % share         Investment under                    Dividend
        Company name                      business        share capital       holding           Cost method                       received
                                                                                               2005         2004          2005            2004
Related companies
Udon Pattana (1994) Co.,Ltd.            Hospital             300,000          10.00             31,650       31,650           -                -
Bangkok Airways Co., Ltd                Airline              440,000            3.27            36,000       36,000           -           7,762
Total                                                                                           67,650       67,650           -           7,762
Less : Allowance for impairment
of investments                                                                               (12,333) (11,408)                -                -
Total other investment                                                                          55,317       56,242           -           7,762



12. PROPERTY, PLANT AND EQUIPMENT
                                                                                                                                     (Unit : Baht)

                                                                                 Consolidated
                                     Assets which are stated at
                                     cost or reappraised value                  Assets which are stated at cost

                                                                                                          Building under
                                                                                                         construction and
                                     Land and         Building and      Medical tools
                                                                                           Vehicles        medical tools               Total
                                   improvement          structure      and equipment
                                                                                                          and equipment
                                                                                                         under installation
Cost/reappraised value
31 December 2004                  2,672,876,435 6,127,951,256 4,480,528,420 183,632,131                   1,044,871,534 14,509,859,776
Increase from investments
     in subsidiary                  122,743,480 1,271,910,461             561,830,642    18,037,396         147,033,786            2,121,555,765
Purchase                             49,140,000        89,304,535         628,746,218    61,721,001       2,052,373,443            2,881,285,197
Transfer in                          32,500,000 1,027,477,432             176,334,905      3,447,204               -               1,239,759,541
Transfer out                              -              (749,035)      (23,710,801)           -         (1,212,396,530) (1,236,856,366)
Disposals                                 -          (124,047,617) (107,994,308)         (3,371,096)               -               (235,413,021)
31 December 2005                  2,877,259,915 8,391,847,032 5,715,735,076 263,466,636                   2,031,882,233 19,280,190,892
Accumulated depreciation
31 December 2004                     15,221,439 1,502,611,943 2,618,230,347              90,600,214                -               4,226,663,943
Increase from investments                 -           376,470,126         376,460,448      9,626,214               -                762,556,788
     in subsidiary
Depreciation for the year                 -           389,555,292         528,558,116    34,417,472                -                952,530,880
Disposals                                 -            (1,652,117) (110,491,261)         (3,056,939)               -               (115,200,317)
31 December 2005                     15,221,439 2,266,985,244 3,412,757,650 131,586,961                            -               5,826,551,294
Net book value
31 December 2004                  2,657,654,996 4,625,339,313 1,862,298,073              93,031,917       1,044,871,534 10,283,195,833
31 December 2005                  2,862,038,476 6,124,861,788 2,302,977,426 131,879,675                   2,031,882,233 13,453,639,598
Depreciation charged (included in statement of earnings) for the year
     2004                                                                                                                           354,884,462
     2005                                                                                                                           952,530,880




86
                                                                                                                            (Unit : Baht)

                                                                              Consolidated
                                     Assets which are stated at
                                     cost or reappraised value               Assets which are stated at cost

                                                                                                      Building under
                                     Land and        Building and     Medical tools                  construction and
                                   improvement         structure     and equipment                     medical tools
                                                                                        Vehicles      and equipment          Total
                                                                                                     under installation


Cost/reappraised value
31 December 2004                   478,575,242      1,251,733,221 1,585,802,964 102,846,624              559,668,792      3,978,626,843
Purchase                            48,975,000           6,970,051    284,920,678     48,385,587       1,272,414,488      1,661,665,804
Transfer in                         32,500,000        303,496,584     136,926,444          -                   -           503,338,066
Transfer out                             -                  -         (11,009,837)         -           (440,384,620)      (481,809,495)
Disposals                                -                  -          (7,498,229)    (2,784,527)              -           (10,282,756)
31 December 2005                   560,050,242      1,562,199,856 1,989,142,020 148,447,684            1,391,698,660      5,651,538,462
Accumulated depreciation
31 December 2004                         -            294,783,102     859,098,175     54,402,959               -          1,208,284,236
Depreciation for the year                -             55,350,923     186,595,257     19,433,327               -           261,379,507
Disposals                                -                  -          (5,359,683)    (2,480,522)              -            (7,840,205)
31 December 2005                         -            350,134,025 1,040,333,749       71,355,764               -          1,461,823,538
Net book value
31 December 2004                   478,575,242        956,950,119     726,704,789     48,443,665         559,668,792      2,770,342,607
31 December 2005                   560,050,242      1,212,065,831     948,808,271     77,091,920       1,391,698,660      4,189,714,924
Depreciation charged (included in statement of earnings) for the year
    2004                                                                                                                   192,635,057
    2005                                                                                                                   261,379,507



   The cumulative capitalized interest on loans recorded as part of the cost of the building amounted to approximately
Baht 87.48 million for the Company and Baht 436.12 million for the subsidiary companies.


   In 1999, the Company and some subsidiary companies engaged an independent professional appraiser to appraise
all of the Company's and the subsidiary companies' land (including the land not used in operations) with carrying
cost value of approximately Baht 210 million and Baht 80 million, respectively. Based on the appraisal reports dated
July 14, 1999 and July 15, 1999, respectively, the Market Approach Method was applied to the revaluation, reflecting
the fair market value of the revalued land of approximately Baht 637 million and Baht 93 million, respectively, which
was higher than the cost by approximately Baht 427 million and Baht 13 million, respectively. The Company and the
subsidiary companies recorded the difference between the historical cost and appraisal value as "Revaluation surplus
of land" under shareholders' equity in the balance sheets.




                                                                                                                                     87
   In 2004, 3 subsidiaries engaged an independent professional appraiser to appraise all of their land and buildings.
Based on the appraisal reports dated December 15, 2004 and December 16, 2004, the Cost Approach Method was
applied to the revaluation, reflecting the fair values of the revalued land and buildings of approximately totaling Baht
1,972.02 million and Baht 2,699.04 million, respectively, which were higher than the former revalued cost by approximately
Baht 1,085.32 million and Baht 498.68 million, respectively. The Subsidiaries recorded the total revaluation surplus of
Baht 1,584 million as "Revaluation surplus on land and buildings" in shareholders' equity in the balance sheets of Baht
1,544.49 million and reversed the loss on valuation of and of a Subsidiary of Baht 228.05 million and recorded loss on
revaluation of land in another subsidiary of Baht 188.54 million.


   Based on the appraisal of land and buildings of such Subsidiaries, the Company recognized the surplus on revaluation
of land and buildings of the Subsidiaries in the consolidated financial statements and the separate financial statements
of the Company by using equity method in the amount of Baht 513.56 million as "Revaluation surplus on land and
buildings" in shareholders' equity in the balance sheets.


   For the year ended 31 December 2005, a subsidiary company calculated depreciation of buildings that had been
revalued and transferred revaluation surplus on land and buildings to reduce related depreciation in statement of
earnings of approximately Baht 74.07 million.


   If the Company and the subsidiary companies record the land and buildings at cost, their net book value as at
31 December 2005 and 2004 would have been as follows :-




                                                                                                               (Unit : Baht)

                                                          Consolidated                        The Company only

                                                                 Building structure                     Building structure
                                                   Land          and improvement           Land         and improvement

Net book value :
As of 31 December 2005                          1,476,058,123      5,397,684,364        237,172,790             -
As of 31 December 2004                          1,348,186,994      3,919,695,625        155,697,790             -




   The Company and the subsidiary companies have mortgaged their land and buildings and constructions to be
created in the future as collateral for long-term loans as discussed in Note 16 to the financial statements.


   A subsidiary company's building and equipment and inventories were damaged by flood in November 2005.
However, the subsidiary company has accident insurance with a domestic insurance company which covers property
damage as a result of the flood. The subsidiary company has not recorded loss on impairment of the fixed assets
destroyed and damaged by the flood and the amount of compensation for losses to be received under the insurance in
the financial statements for the year ended 31 December 2005 since the subsidiary company and the insurance company
are in the process of assessing the damage to the property. However, the subsidiary management believes that the
provision for impairment of fixed assets destroyed would be fully covered by the insurance or if any, the subsidiary
would have an insignificant loss from such accident.




88
13. INTANGIBLE ASSETS

                                                                                                                  (Unit : Baht)

                                                                 Consolidated                      The Company only
                                                             2005            2004                  2005             2004

Computer software                                         153,266,241     112,324,408           40,472,572       12,982,006
Leasehold right                                            46,268,019      40,468,019           38,218,019       38,218,019
Expenditure relating to certain rights                    113,723,076           -                    -                 -
and benefits received from Bangkok Nursing Home
                                                          313,257,336     152,792,427           78,690,591       51,200,025
Less : Accumulated amortization                         (106,432,565)    (56,669,703)          (37,171,465)     (6,777,657)
Intangible assets - net                                   206,824,771      96,122,724           41,519,126       44,422,368


Amortization for the year                                  39,563,238      11,700,934           13,874,670        6,777,657




14. LAND NOT USED IN OPERATIONS

   Land not used in operations as at 31 December 2005 and 2004 consisted of:

                                                                                                                  (Unit : Baht)

                                                                                    Consolidated and The Company Only
                                                                                        2005                    2004

Land at historical cost                                                              367,181,670              367,181,670
Revaluation surplus                                                                  104,245,510              104,245,510
Transfer to land for operation                                                      (32,500,000)                   -
Total                                                                                438,927,180              471,427,180



   In 1999, the Company revalued such land based on the independent professional appraiser's value as described
in Note 12 to the financial statements.


   The cumulative capitalized interest on loans recorded as a portion of cost of land not yet used in operations amounted
to approximately Baht 29 million.



15. BANK OVERDRAFTS AND SHORT-TERM LOANS FROM FINANCIAL
INSTITUTION

   As at 31 December 2005, the Company and its subsidiary companies have bank overdraft facilities with local
banks of Baht 158 million and the Company only of Baht 50 million with interest rate at MOR (Minimum
Overdraft Rate).




                                                                                                                            89
16. LONG-TERM LOANS

      As at 31 December 2005, long-term loans consist of : -
                                                                                                                    (Unit : Million Baht)

                                                                                         Outstanding long - term loan amount

                                                                                         Current      Non-Current
No.                      Agreement date                Lender       Credit facility      Portion        Portion                  Total

The Company only
1.                      17 December 2001            Local Bank          2,300                290          1,140                 1,430
2.                             26 March 2002        Local Bank                20               3               7                     10
3.                      19 November 2004            Local Bank                85              21              50                     71
4.                            13 January 2005       Local Bank               139              29              90                   119
5.                            13 January 2005       Local Bank               102              21              66                     87
6.                            5 October 2005        Local Bank               350              53            297                    350
7.                      29 September 2005           Local Bank                45               9              36                     45
8.                       1 December 2005            Local Bank               600               -            480                    480
Total loans of the Company                                                                   426          2,166                 2,592




                                                                                                                    (Unit : Million Baht)

                                                                             Significant conditions of the loan agreements
                                                                    Loan        Principal      Interest
No.        Agreement date             Lender     Credit facility   Period      repayment       payment              Interest rate

The Company only
                                                                                                          At fixed rate or MLR less fixed
1.       17 December 2001           Local Bank       2,300         9 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
2.           26 March 2002          Local Bank          20         7 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
3.       19 November 2004           Local Bank          85         5 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
4.          13 January 2005         Local Bank         139         5 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
5.          13 January 2005         Local Bank         102         5 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
6.          5 October 2005          Local Bank         350         7 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
7.       29 September 2005          Local Bank          45         5 years         Monthly     Monthly    rate as stipulated in the agreement.

                                                                                                          At fixed rate or MLR less fixed
8.        1 December 2005           Local Bank         600         9 years         Monthly     Monthly    rate as stipulated in the agreement.




90
                                                                                                          (Unit : Million Baht)

                                                                                      Outstanding long - term loan amount

                                                                                        Curren      Non- Current
No.                            Agreement date          Lender       Credit facility     Portion       Portion          Total

Subsidiaries
Bangkok Phuket Hospital Co., Ltd.
1.                             18 December 2002       Local Bank          500              50            387            437
Bangkok Trat Co., Ltd
1.                             1 December 2003        Local Bank          140               7             86              93
Bangkok Hatyai Hospital Co., Ltd
1.                             9 May 2003             Local Bank          400               -            300            300
2.                             8 September 2004       Local Bank           37               8             20              28
Bangkok Rayong Hospital Co., Ltd.
1.                             29 March 2004          Local Bank          330               -            324            324
Bangkok Samui Hospital Co., Ltd.
1.                             11 June 2004           Local Bank          150               -            150            150
BNH Medical Centre Co., Ltd.
1.                             20 October 1996        Local Bank          679              22            411            433
2.                             20 October 1990    Local Financial         679              22            411            433
                                                      Institution
Wattanavej Co., Ltd.
1.                             27 Noember 2003        Local Bank          135              26             90            116
Samitivej Public Company Limited
1.                             11 October 2001        Local Bank        1,700             160           1,358         1,518
2.                             26 December 2003                           185              19            166            185
3.                             2 June 2005            Local Bank          165              25             22              47
Irving Sheridan SE Co., Ltd.
1.                             26 December 2003       Local Bank          115              11            104            115
Total loans of subsidiary companies                                                       350           3,829         4,179
Total loans of the Company and subsidiary companies                                       776           5,995         6,771




                                                                                                                           91
                                                                                                                        (Unit : Million Baht)

                                                                                   Significant conditions of the loan agreements
                                                                         Loan        Principal   Interest
No.            Agreement date           Lender        Credit facility   Period      repayment    payment               Interest rate

Subsidiaries


Bangkok Phuket Hospital Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             18 December 2002       Local Bank            500         10 years     Quarterly    Monthly
                                                                                                              rate as stipulated in the agreement.


Bangkok Trat Co., Ltd

                                                                                                              At fixed rate or MLR less fixed
1.             1 December 2003        Local Bank            140          6 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.


Bangkok Hatyai Hospital Co., Ltd

                                                                                                              At fixed rate or MLR less fixed
1.             9 May 2003             Local Bank            400         10 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.

                                                                                                              At fixed rate or MLR less fixed
2.             8 September 2004       Local Bank             37          5 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.


Bangkok Rayong Hospital Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             29 March 2004          Local Bank            330         10 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.


Bangkok Samui Hospital Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             11 June 2004           Local Bank            150         10 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.


BNH Medical Centre Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             20 October 1996        Local Bank            679         13 years     Quarterly    Monthly
                                                                                                              rate as stipulated in the agreement.

                                    Local Financial                                                           At fixed rate or MLR less fixed
2.             20 October 1990                              679         13 years     Quarterly    Monthly
                                      Institution                                                             rate as stipulated in the agreement.


Wattanavej Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             27 Noember 2003        Local Bank            135          6 years     Quarterly   Quarterly
                                                                                                              rate as stipulated in the agreement.


Samitivej Public Company Limited

                                                                                                              At fixed rate or MLR less fixed
1.             11 October 2001        Local Bank          1,700         10 years      Monthly     Monthly
                                                                                                              rate as stipulated in the agreement.

                                                                                                              At fixed rate or MLR less fixed
2.             26 December 2003       Local Bank            185         10 years     Quarterly    Monthly
                                                                                                              rate as stipulated in the agreement.

                                                                                                              At fixed rate or MLR less fixed
3.             2 June 2005                                  165          6 years     Quarterly    Monthly
                                                                                                              rate as stipulated in the agreement.


Irving Sheridan SE Co., Ltd.

                                                                                                              At fixed rate or MLR less fixed
1.             26 December 2003       Local Bank            115         10 years     Quarterly    Monthly
                                                                                                              rate as stipulated in the agreement.




92
   The Company and its subsidiaries have mortgaged certain plots of land and buildings, including construction to
be erected in the future and equipment with banks to secure long-term loan obtained from those banks.


   During1998 - 2004, a subsidiary company, BNH Medical Center Co., Ltd. entered into 4 debt restructuring agreements
with 2 local financial institutions and the subsidiary company has to comply with the conditions as stipulatedin the
agreements.


   The above long-term loans are secured by land lease agreements, buildings and equipment. In addition, the financial
institutions are named as beneficiaries of the insurance policies for that company's building and equipment.


17. LIABILITIES UNDER HIRE-PURCHASE AND FINANCIAL LEASE
AGREEMENTS

                                                                                                    (Unit : Thousand Baht)

                                                             CONSOLIDATED                  THE COMPANY ONLY
                                                            2005            2004             2005              2004

Hire-purchase and financial lease payable                  352,907         319,029          108,493            74,459
Less : Deferred interest                                  (36,156)        (39,722)         (10,406)            (8,685)
Total                                                      316,751         279,307           98,087            65,774
Less: Current portion due within one year                (115,794)        (80,839)         (37,280)          (22,860)
Liabilities under hire-purchase and financial
lease agreement - net of current portion                   200,957         198,468           60,807            42,914



Liabilities under hire-purchase agreements
   Hire-purchase payable consists of amounts payable under various vehicle hire-purchase agreements, with payments
to be made in 32-60 monthly installments.


Liabilities under financial lease agreements
   The Company and its subsidiaries have entered into various financial lease agreements with various leasing companies
to rent medical equipment and vehicle for use in their operations. Installments are paid on a monthlybasis over 36-60
periods and at the end of the agreements, the Company and the subsidiaries have the option to purchase the equipment
at prices specified in the agreements.


18. SHARE CAPITAL

   On 22 April 2004, the Annual General Meeting of the Company's shareholders resolved to change the par value
of the Company's shares from Baht 10 each to Baht 1 each. The Company has subsequently registered the change in
par value of its shares with the Ministry of Commerce on 11 May 2004.




                                                                                                                         93
   In addition, such Meeting also passed a resolution to approve the Company to increase its registered capital from
Baht 750 million to Baht 1,000 million, by issuing of 250 million new ordinary shares of Baht 1 each at the issue price
of Baht 6 per share by offering to the existing shareholders in the proportion of 3 existing shares to 1 newly issued
share, and have a right to exercise over right. The Company registered the increase of its registered share capital on
May 14, 2004. The shareholders subscribed and paid for the increased shares during 21st-25th June 2004 totalling
Baht 1,769 million. In July 2004, the Company repaid the shareholders who over paid the subscribed money in the
amount of Baht 269 million. The Company registered the paid-up share capital to be Baht 1,000 million on July 9, 2004


   The Extraordinary General Meeting of the Company's Shareholders No 1/2547 held on August 3, 2004, passed a
resolution to approve the Company to further increase its registered capital by Baht 180.50 million by issuing 180.5
million new ordinary shares at the par value of Baht 1 per share, increasing share capital from Baht 1,000 million to
Baht 1,180.50 million, divided into 1,180.50 million ordinary shares at Baht 1 per share. The Company registered the
increase of its registered capital on August 5, 2004.


   In addition, the Meeting also passed a resolution to approve the shareholding restructuring by offering to purchase
all the issued shares of Samitivej Public Company Limited, Bangkok Hatyai Hospital Company Limited and Bangkok
Phuket Hospital Company Limited not already held by the Company. The Company will pay the consideration for the
share in those companies in the form of new issued ordinary shares of the Company without offering any other
alternative in term of cash, and approved to purchase shares of Ramkhamhaeng Hospital Public Company Limited, in
a portion not more than 20% of the total issued shares of this company, at the price not higher than Baht 150 per share,
up to Baht 360 million in total. In July 2004, the Company purchased shares of Ramkhanhaeng Hospital Public
Company Limited in the amount of Baht 215.49 million.


   Later in December 2004, the Company purchased additional shares of Ramkhamhang Hospital Public Company
Limited by Baht 127.42 million, totaling the investments in this company of Baht 342.91 million.


   The Securities and Exchange Commission ("SEC") had approved the Company to start the tender offer period
during November 10, 2004 to December 16, 2004. After the share swap arrangement, the percentage of shareholding
in Samitivej Public Company Limited, Bangkok Hatyai Hospital Company Limited and Bangkok Phuket Hospital
Company Limited were 92.92%, 98.53% and 99.47%, respectively, and the Company's shares were allotted to these
companies of 112,251,510 shares, 18,528,904 shares and 32,629,694 shares, respectively or a total of 163,410,108 shares.
For the remaining 17,089,892 shares, the Extraordinary General Meeting of the Company's Shareholders No.1/2547
held on August 3, 2004 passed a resolution to approve the Company's Board of Directors to manage the remaining
shares by offering those shares by private placement according to SEC's Notification No. Kor Jor 12/2543.


   The 163,410,108 shares issued for share swap arrangement with these three companies were recorded at fair value, a
ppraisal by an independent financial advisor, using discounted cash flows method, at Baht 10.21 per share, resulting in
the increase in issued and paid-up share capital by Baht 163.41 million, and increase in premium on share capital by
Baht 1,505 million. The Company registered the issued and paid-up share capital to be Baht 1,163.41 million on
December 21, 2004.




94
   On 17 September 2005, the Board of Directors Meeting No. 9/2005 approved to decrease share capital of 17,089,892
shares remaining from the above allotment and on 17 October 2005 the Extraordinary General Meeting of the Company's
shareholders No. 1/2005 passed a resolution approving a capital reduction on such remaining share capital and approved
the increase in registered share capital of 20,000,000 ordinary shares. The increase and decrease in share capital is
registered on 28 October 2005 and the Company's registered share capital is now Baht 1,183,410,108.


    In addition, such meeting approved the Company's restructuring planning by acquisition of shares from all other
shareholders of the eastern hospital group, which comprised Bangkok Pattaya Hospital Co., Ltd., Bangkok Trat Hospital
Co., Ltd., Wattanavej Co., Ltd., and Bangkok Rayong Co., Ltd.. Such purchase was subject to the condition that those
shareholders must purchase the Company's shares by using all proceeds received from the Company for such purchase
as payment for the Company's shares. The Company's shares to be offered to the shareholders of the eastern hospital
group would comprise of the above new 20 million ordinary shares and/or the shares of the Company held by Bangkok
Pattaya Hospital Co., Ltd. All of them would be offered to those shareholders in the same time at the price of Baht 14.59
each. For the purpose of eliminating cross shareholding between the Company and Bangkok Pattaya Hospital Co., Ltd.
the entire shares of Company which are held by Bangkok Pattaya Hospital Co., Ltd. would be offered to those
shareholders before the new ordinary shares of the Company.


19. DIVIDENDS

   The 2005 Annual General Meeting of the Company's shareholders held on 7 April 2005, passed a resolution approving
a dividend payment of Baht 0.50, to the holders of the Company's 1,163,410,108 shares (par value of Baht 1 each), or
a total of Baht 582 million and the appropriation of net profit as statutory reserve in the amount of Baht 27.8 million.
The dividend payment was made on 6 May 2005.


   On 22 April 2004, the Annual General Meeting of the Company's shareholders approved to pay a dividend for
75 million shares (at par value of Baht 10 each) at the rate of 4 Baht per share, totaling Baht 300 million which was the
rate before the Company change its par value from Baht 10 per share to be Baht 1 per share and the appropriation of
net profit as statutory reserve in the amount of Baht 16 million. The dividend payment was made on May 21, 2004.


20. STATUTORY RESERVE

   Under the Public Companies Limited Act B.E. 2535, the Company is required to set aside as a statutory reserve at
least 5 percent of its net profit, after deducting accumulated deficit brought forward (if any), until the reserve reaches
10 percent of its registered share capital. The statutory reserve is not available for dividend payment.


   Pursuant to Section 1202 of the Thai Civil and Commercial Code, a local subsidiary must appropriate to a reserve
fund, at each distribution of dividend, at least five percent of the profits arising from the business of the subsidiary
company, until the reserve fund reaches ten percent of the registered capital of the subsidiary company. The statutory
reserve is not available for dividend distribution.




                                                                                                                      95
21. PROVIDENT FUND

   The Company, its subsidiaries and their employees jointly established a provident fund in accordance with the
Provident Fund Act B.E. 2530. The fund is contributed by both employees and the Company and its subsidiaries at the
agreed percentage rates based on their basic salaries and is managed by many financial institutions. The fund will be
paid to the employees upon termination in accordance with the rules of the fund.


   During the year 2005, the Company and its subsidiaries contributed Baht 35.43 million (2004 : Baht 18.42 million)
to the fund and the Company only contributed Baht 11.50 million (2004 : Baht 9.28 million).



22. NUMBER OF EMPLOYEES AND RELATED COSTS


                                                                Consolidated                   The Company only
                                                             2005              2004           2005             2004

Number of employees at end of year (persons)                   7,817            5,972           2,256           1,964
Employee costs for the year (Thousand Baht)                2,511,711      1,846,365          968,765          828,048




23. FINANCIAL INSTRUMENTS

23.1 Financial risk management and policies
   The Company and its subsidiaries are exposed to risk arising from changes in market interest rates and from
nonperformance of contractual obligations by counterparties in the future. The Company and its subsidiaries use
derivative instruments, as and when they consider appropriate, to manage such risks. They do not hold or issue
derivative financial instruments for speculative or trading purposes.


23.2 Interest rate risk
   The interest rate risk is risk whereby future movement in market interest rates will affect the results of the Company
and its subsidiaries' operations and their cash flows. The Company's and its subsidiaries' exposure to the interest rate
risk relates primarily to deposits with and loans from banks. However, deposits with and loans from banks carry interest
at floating rates. The Company and its subsidiaries do not use derivative financial instruments to hedge such risk.


23.3 Credit risk
   Credit risk is the risk that a counterparty is unable to meet a commitment entered into with the Company and the
subsidiaries. This risk is controlled by the application of credit approvals, limits and monitoring procedures. The
maximum credit risk exposure is the book value of assets after deduction of allowance for doubtful accounts as
presented in the balance sheets.




96
23.4 Fair value
   As the majority of financial assets and liabilities are short-term or carry interest at the floating rate, their carrying
value do not materially differ from their fair value.


24. LONG-TERM LEASE AGREEMENTS

The Company
   The Company has entered into a land lease agreement on which a garden is to be built. The lease agreement covers
a period of 30 years from 1 January 2005 to 31 December 2033 and the Company is obliged to payrental on a monthly
basis. The rental fee for the first 5 years is Baht 10,000 per month and this fee is to be increased by every 5 years. The
rental for the last 5 years will thus be Baht 25,000 per month.


   The Company has entered into a land rental agreement for a parking building for 20 years from 26 February 2004
to 25 February 2024. The rental fee for the first 17 months is Baht 200,000 per month and this is to be increased by the
rate as stipulated in the agreement. The rental for the last 3 years will be Baht 560,000 per month.


   The Company has entered into a land rental agreement whereby the land is to be used for construction of an OPD
building for a period of 30 years from 28 September 2004 to 27 September 2034. The first payment date is 10 October 2005
at the rental fee of Baht 50,000 per month, with this rate being increased by 10% of the latest rental every three years.


   The Company has entered into a land rental agreement for a car park for a period of 7 years from 1 September 2005
to 31 August 2012 and the rental is paid on a monthly basis. The first payment date is 1 September 2005 and rental to
be paid at Baht 131,000 per month and from 1 September 2006 onward at Baht 175,000 per month.


Samitivej Public Company Limited
   The subsidiary has entered into a rental agreement for a parking building dated 10 September 2003, for 30 years,
effective from 8 December 2004. The rental fee for the first year was Baht 3.39 million and is to be increased by 2.75%
every year. The total rental fee over the lease will thus be Baht 155.11 million. The subsidiary is committed to pay
Baht 38.78 million as prepaid rental as per the schedule. The remaining rental fee will be paid at 85% of rental. In
addition, the subsidiary has entered into a service agreement with the same company for provision of services in the
said parking building for 30 years totaling Baht 103.41 million.


   As at 31 December 2005, the subsidiary company already paid an advance rental payment of Baht 38.78 million
(2004 : Baht 32.80 million) and amortised as an expense in the current year of Baht 0.85 million (2004 : Baht 0.08 million).


   In 2005, the subsidiary company entered into the 3-year building rental agreement with another subsidiary company
for the hospital operation. The subsidiary has to pay a monthly rental fee of Baht 1,000,000 commencing from May 2005.




                                                                                                                         97
25. COMMITMENTS AND CONTINGENT LIABILITIES

   As at 31 December 2005 commitments and contingent liabilities are as follows:-


25.1 Commitments

                                                                                                         (Unit : Million Baht)

                                                                                     Consolidated   The Company only

Contractual commitments
the land and building rental contracts (including long-term agreements in Note 24)       320                 83
• the office equipment rental and maintenance contracts                                   37                 19
• the medical equipment providing contracts                                              178                133
• the building decoration contracts                                                      444                248
Contingent liabilities
• For letters of guarantee issued by banks 64 44                                          64                 44
Total                                                                                  1,043                527



25.2 Litigations
   As at 31 December 2005, a subsidiary company was named joint defendant with doctors in a case relatingto the
medical treatment of a patient in 1996, whereby the plaintiff claimed for a compensation amounting to approximately
Baht 659.6 million. On 9 February 2004, the Civil Court dismissed the case, and it is currently being heard by the Court
of Appeal. The management of the subsidiary, after consulting with the subsidiary's legal counsel, is of the opinion that
the Appeal Court will not reverse the judgement of the Civil Court to dismiss the case.


   In addition, as at 31 December 2005, the said subsidiary was named joint defendant with doctors in a case relating
to the medical treatment of a patient in 2002, whereby the plaintiff claimed for a compensation amounting to
approximately Baht 39.40 million. The case is being considered by the Primary Court. The management of the subsidiary
and the subsidiary's legal counsel are of the opinion that the court will ultimately rule in favour of the subsidiary.


   A subsidiary has a contingent liabilities as a defendant in a legal case related to the building construction retention
of Baht 14.37 million. The case is being considered by the Central Bankruptcy court.


26. PURCHASE OF SUBSIDIARY COMPANIES

   During April to December 2005, the Company has invested in additional ordinary shares in subsidiaries companies,
BNH Medical Center Co., Ltd., Wattanavej Co., Ltd, and B.D.M.S. International Medical Services Co., Ltd. which have
fair values of assets purchased and liabilities as at purchased dates as follows :-




98
                                                                                                          (Unit : Baht)


 Cash and cash equivalents                                                                              318,868,431
 Short-term investments                                                                                     134,243
 Trade accounts receivable - net                                                                         44,421,577
 Inventories - net                                                                                       10,534,578
 Other current assets                                                                                    22,098,220
 Investments                                                                                             19,060,010
 Property, plant and equipment - net                                                                   1,349,530,584
 Intangible assets - net                                                                                125,149,945
 Other non-current assets                                                                                11,451,737
 Trade accounts payable                                                                                 (68,753,479)
 Other payable - related parties                                                                        (10,175,048)
 Accrued expenses                                                                                       (55,780,338)
 Other current liabilities                                                                              (32,048,152)
 Long-term loans                                                                                     (1,023,877,720)
 Net acquired assets                                                                                    710,614,588
 Changes in investment from change of the status from associated to subsidiary companies               (216,284,654)
 Changes in minority interest from change of the status from associated to subsidiary companies        (213,778,255)
 Net assets from acquisition of subsidiary companies                                                    280,551,679
 Add : Goodwill                                                                                          75,810,560
 Cash paid for investment which change of the status from associated to subsidiary companies            356,362,239
 Cash paid for additional investment in subsidiaries                                                    198,976,310
 Cash flows used in acquisition of the subsidiary company                                               555,338,549
 Less : Cash and cash equivalents of subsidiary companies                                              (318,868,431)
 Net assets from acquisition of subsidiary companies                                                    236,470,118




27. SEGMENT INFORMATION

   The Company and its subsidiary companies operate mainly in the hospital business in Thailand. As a result all
of the revenues, operating profits and assets as reflected in these financial statements pertain to the aforementioned
ndustry segment and geographic area.


28. DIRECTORS' REMUNERATION

   Directors' remuneration of the Company represents the benefits paid to the Company's directors in accordance
with Section 90 of the Public Limited Companies Act, exclusive of salaries and related benefits payable to executive
directors.




                                                                                                                    99
29. SUBSEQUENT EVENT

    In January 2006, the Company has already acquired the shares from the shareholders of the eastern hospital group
according to the resolution of the Extraordinary General Meeting of the Company's shareholders No. 1/2005 which
will increase its percentage of shareholding in these group companies. On 30 January 2006 the Company has registered
an increase in its paid up share capital from Baht 1,163 million to Baht 1,181 million to allocate to shareholders of these
group companies.


   The Board of Directors' Meeting No. 1/2006 hold on 21 January 2006 has passed a resolution to set up a subsidiary
company and an associated company in Cambodia with an investment amounting to Baht 84 million with the objectives
to hold land and operate the hospital in that country.


    The Board of Directors' Meeting No. 2/2006 held on 28 February 2006 passed a resolution approving a dividend
payment of Baht 0.50 per share, to the holders of the Company's 1,181,037,800 shares (par value of Baht 1 each), or a
total of Baht 590.5 million and the appropriation of net profit as statutory reserve in the amount of Baht 0.29 million.
The resolution will be presented to the Annual General Meeting of the Company's shareholders for approval of dividend
payment which will be paid on 28 April 2006.


30. PRESENTATION AND RECLASSIFICATION

   The presentation of the financial statements has been made in compliance with the stipulations of the Notification
of the Department of Business Development dated 14 September 2001 as empowered under the Accounting Act B.E. 2543.


   Certain amounts in the financial statements for the year 2004 which are presented herein for the comparative
purpose have been reclassified to conform to the current year's classification, with no effect on previously reported net
earnings or shareholders' equity.


31. APPROVAL OF FINANCIAL STATEMENTS

   These financial statements have been authorised for issue by the Company's authorised directors on 28 February 2006.




100
Bangkok Dusit Medical Services Public Company Limited
2 Soi Soonvijai 7 New Phetchburi Rd., Bangkok 10310 Tel. 02-310-3000 Fax 02-318-1546

www.bangkokhospital.com

				
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