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รายงานประจำปี 2555
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Annual Report 2012
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Annual Report 2012
Vision 2President’sMessage 3BoardofDirectors 4AwardsandAchievements 6FinancialHighlights 7MarketShareofSingleProducts 7CompanyHoldingStructure 9KeyMilestones 10RevenueStructure 12AAPICOGroupBusiness 13MainBusinesses 14CompetitionandIndustrialTrend 20BusinessOperationGoalsandFutureProjects 22RiskFactors 24ShareholdingStructureandManagement 30OrganizationandManagement 36BoardofDirectors’Information 37Employees 39CorporateGovernanceReport 40InternalControl 45RelatedTransactions 47ManagementDiscussionandAnalysis 48ReportoftheNominationandRemunerationCommittee 54ReportoftheAuditCommittee 55CorporateSocialResponsibility 57CompanyContactInformation 60Reference 63
Content
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VISION The AAPICO Group’s vision is to become a lean
and happy world-class organization with
4 fundamental values of Happy Customers,
Happy Employees, Happy Shareholders,
and Happy Public.
2012isthebestperformingyearinthehistoryoftheAAPICOGroupintermsofsalesandprofits.Revenuesandnet profit reached Baht 17 billion and Baht 917million respectively. The good performance was in line with theexcellentgrowthofthecarindustryinThailand.Thegrowthwasfueledpartlyfromthestrongeconomicenvironmentbutmainlyfromthetaxrebatebythegovernmentforthesmallcarfirst-timecarbuyers.Perhapswecanlabel2012thegoldenyearfortheautomotiveindustry.
Thecarproductionincreasedfrom1,436,355unitsto2,453,717unitsfromyear2011to2012respectively,oneofthebiggest jumps in a single year in the history of the car industry in the Kingdom of Thailand. For 2013, the carproductionisexpectedtostayaroundthe2.5millionmark.
InApril 2012,wehavemoved intoourown37,000squaremeters forgingandmachining factory inKunshan.ThismodernfacilityhasadequatespacetoincreaseproductionuptoBaht2billion.
In2012,wealsomovedintotwonewfacilitiesforourHondadealershipsinMalaysia.OnelocatedattheoutskirtsofKualaLumpuratKajangandtheotherlocatedatPetalingJaya.Thelatterisequippedwith2paintboothsforbodyrepairandpainting.
Annual Report 2012
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InThailand,mostofourpartsmanufacturingoperationsimprovedasthemanynewmodelsofcarslaunchedearlierarereachingtheirmaturityofproduction.Mostofourplantswereoperatinginfullcapacityintwoshiftsexceptforourplasticfueltankfactoryworkingoneshiftfullcapacity.
OurMitsubishiandFordcardealershipsperformedwell in linewith thestrongestcardemandeverexperienced inThailand.
Themomentumin2012isexpectedtobecarriedforwardto2013.
Inclosing,Iwouldliketotakethisopportunitytothankallourcustomers,employees,associates,businesspartners,bankers,suppliersandgovernmentofficialswithoutwhosesupportwewouldnothavebeenabletodeliverthisrecordperformance.
YeapSweeChuan
PresidentandCEO
President’s Message
2012 is the best performing year in
the history of AAPICO Group.....
Perhaps we can label 2012 the
golden year .....
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�Board of Directors
1. Mr.YeapSweeChuan President&CEO2. Mrs.TeoLeeNgo ExecutiveDirector3. Mr.YoshiakiIchimura IndependentDirector4. Mr.HirotoMurai Director5. Mr.PipatR.Punya IndependentDirector ChairmanofAuditCommittee/ Nomination&RemunerationCommittee6. Mr.SupasakChirasavinuprapand IndependentDirector MemberofAuditCommittee/ Nomination&RemunerationCommittee7. Mrs.PorntipaPraditsuktavorn IndependentDirector MemberofAuditCommittee/ Nomination&RemunerationCommittee8. Mr.JohnParker IndependentDirector9. Mr.KennethNg IndependentDirector
Annual Report 2012
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Annual Report 2012
Mr. Yeap Swee Chuan Age 65 Work Experience in the past 5 years 2010-present Director, BoardofTrade2010-present ViceChairman, PeaceNetworkofThailand2005-present Chairman, MalaysianThaiChamberofCommerce2000-present Director,AuditCommittee Goodyear(Thailand)PLC.1996-present PresidentandCEO, AAPICOHitechPLC.
1
Mrs. Teo Lee Ngo Age 62 Work Experience in the past 5 years 1996-present ExecutiveDirector, AAPICOHitechPLC.1996-present Director, AbleSanohIndustries(1996)Co.,Ltd.
2
Mr. Yoshiaki Ichimura Age 58 Work Experience in the past 5 years 2012-present President, HyundaiMotor(Thailand)Co.,Ltd.2009-2011 SeniorVicePresident,MachineryDivision SeniorGeneralManager,AutomotiveUnit SojitzCorporation2007-2008 GeneralManagerofAutomotiveDept.3, AutomotiveUnit,Machineryand AerospaceDivisionSojitzCorporation
3
Mr. Hiroto Murai Age 46 Work Experience in the past 5 years 2005-present Director, AAPICOHitechPLC.2005-present Director, SAITCo.,Ltd. (SojitzAutomotiveInvestment)
4
Mr. Pipat R.Punya Age 63 Work Experience in the past 5 years 2004-present Director, VillaComfortaCo.,Ltd.1996-present IndependentDirector,ChairmanofAudit CommitteeandChairmanofNomination andRemunerationCommittee, AAPICOHitechPLC.1988-present Director, GoThailandTourCo.,Ltd.1983-present Firstclasslawyer, NitipatLawFirmCo.,Ltd.
5
Mr. Supasak Chirasavinuprapand Age 49 Work Experience in the past 5 years 2004-present Partner, RoyalAdvocatesInternationalLimited2002-present IndependentDirector,MemberofAudit CommitteeandMemberofNomination andRemunerationCommittee, AAPICOHitechPLC.
6
Mrs. Porntipa Praditsuktavorn Age 59 Work Experience in the past 5 years 2010-present ManagingDirector, PraditsukCo.,Ltd.2002-present IndependentDirector,MemberofAudit CommitteeandMemberofNomination andRemunerationCommittee, AAPICOHitechPLC.1999-2009 ExecutiveOfficer, PanasonicElectricWorks(Thailand) Co.,Ltd.
7
Mr. John Parker Age 65 Work Experience in the past 5 years 2011-present IndependentDirector, AAPICOHitechPLC.2006-2010 ExecutiveVicePresident-AsiaPacific andAfrica,FordMotorCompany2003-2006 ViceChairmanandCOO,MazdaMotor CorporationVicePresident, FordMotorCompany
8
Mr. Kenneth Ng Age 44 Work Experience in the past 5 years 2008-present IndependentDirector, AAPICOHitechPLC.2007-present Director, BunCompanyCo.,Ltd.2005-present Director, KNKNCo.,Ltd.2005-present Director, NTAsset(Thailand)Co.,Ltd.
9
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Prestigious Award In Spare Parts Delivery For 2012 AAPICOAmataCo.,Ltd.hasbeenawardedwith“The1stRunnerUpInSparePartsDelivery”fromIsuzuMotors(Thailand)Co.,Ltd.forits5thconsecutiveyearonMay29th,2012atBITECBangna
Certified for The Best Health Promotion Enterprise AAPICO Forging PLC., has received the certificate for“The Best Health Promotion Enterprise” from ThaiHealthPromotionFoundation
Prestigious Award in TPS Presentation Activity 2012 AAPICOHitechPLC.,hasbeen awarded with “The1st Runner Up in TPSFinalPresentationActivity2012” from TOYOTACO-OPERATION CLUBonNovember16th,2012
The 2nd Runner Up Zero Accident in The Workplace AwardAAPICOPlasticsPLC., has received “The 2ndRunnerUpZeroAccident in TheWorkplaceAward”with1,000,000hoursofoperationwithzeroaccidentsonSeptember3rd,2012
Awards and Achievements
Annual Report 2012
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Consolidated Financial Statements 2009 2010 2011 2012
Balance Sheet (Million Baht) TotalAssets 9,545 11,474 11,521 13,783TotalLiabilities 5,244 6,868 7,416 8,853Shareholder’sEquity 4,301 4,606 4,105 4,930
Profit and Loss Statements (Million Baht) TotalRevenues 7,366 11,758 10,786 16,811SalesandServiceIncome 7,114 11,344 10,356 16,120GrossProfit(Loss) 358 830 764 1,062EBITDA 427 1,141 403 2,019EBIT 42 705 (59) 1,254NetProfit(Loss)attributabletoequityholders (109) 357 (390) 917Earningpershare (0.48) 1.57 (1.72) 4.05
Financial Ratios CurrentRatio(times) 0.54 0.88 0.67 0.77GrossProfitMargin(%) 5.0% 7.3% 7.4% 6.6%NetProfitMargin(%) -1.5% 3.1% -3.8% 5.7%ReturnonTotalAssets(%) -1.1% 3.1% -3.4% 6.7%ReturnonEquity(%) -2.5% 7.7% -9.5% 18.6%DebttoEquity(times)* 0.67 0.93 1.21 1.08TimeInterestEarned(time) 0.33 4.00 (0.25) 4.34Dividend(%ofNetProfit) N/A 35.44% N/A 34.99%**
* DebttoEquity=(Bankoverdrafts+BankLoans)/TotalEquity ** TheInterimDividendpaymentwasmadefromtheperformanceofthefirsthalfin2012
Market Share of Single Products
Unit:MillionBaht
Sales and Service Income Net Profit (Loss) Attributable to equity holders
Total Assets
Chassis Frame Steel Fuel Tank Door Check
Plastic Fuel Tank
68%
32% 20% 29%
7%
80% 71% 93%
2009 2010 2011 2012 2009 2010 2011 2012 2009 2010 2011 2012
7,114
11,344 10,356
16,120
(109) (390)
357
917
9,54511,474 11,521
13,783
Financial Highlights
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TENAGA SETIA RESOURCES SDN. BHD PETALING JAYA
NEW ERA SALES (M) SDN. BHD. KAJANG SELANGOR
MINTH AAPICO (THAILAND) CO., LTD. RAYONG ABLE MOTORS CO., LTD. PATHUMTHANI
AAPICO HITECH PLC, AAPICO PLASTICS PLC, RAYONG AAPICO FORGING PLC. CHONBURI
AAPICO HITECH PLC. AAPICO HITECH TOOLING CO., LTD. AYUTHAYA
AAPICO HITECH PARTS CO., LTD. AAPICO MITSUIKE (THAILAND)
CO., LTD. AYUTHAYA
AAPICO AMATA CO., LTD. CHONBURI
NEW ERA SALES CO., LTD. BANGKOK
AAPICO PLASTICS PLC. SAMUTPRAKARN
AAPICO ITS CO., LTD. A MACTION CO., LTD.
AYUTHAYA
AAPICO STRUCTURAL PRODUCTS CO., LTD. CHONBURI ABLE SANOH INDUSTRIES (1996)
CO., LTD. AYUTHAYA
KUNSHAN CHAITAI-XINCHENG PRECISION FORGING CO., LTD. KUNSHAN
Annual Report 2012
�Company Holding Structure
AAPICO HITECH Public Co., Ltd.
100%
100%
100%
100%
100%
60%
100%
100%
100%
100%
88%
76%
60%
51%
51%
49%
46%
40%
30%
20%
12%
100%
49%
THAILAND OVERSEAS
AbleITSPte.Ltd.(Singapore)
AAPICOITSCo.Sdn.Bhd.
(Malaysia)
AAPICOInvestmentPte.Ltd.(Singapore)
JackspeedCorporationLimited(Singapore)
AAPICOShanghaiCo.,Ltd.(China)
KunshanChaitai-XinchengPrecision
ForgingCo.,Ltd.(China)
NewEraSales(M)Sdn.Bhd.
(Malaysia)
TenagaSetiaResourcesSdn.Bhd.(Malaysia)
AAPICOEngineeringSdn.Bhd.
(Malaysia)
100%
100%
49%
49%
51% 49%
100%
18%
AAPICOAmataCo.,Ltd.
AAPICOEngineeringCo.,Ltd.
AAPICOForgingPublicCo.,Ltd.
AAPICOPlasticsPublicCo.,Ltd.
AAPICOHitechPartsCo.,Ltd.
AAPICOJackspeedCo.,Ltd.
AAPICOHitechToolingCo.,Ltd.
AAPICOStructuralProductsCo.,Ltd.
AbleMotorsCo.,Ltd.
NewEraSalesCo.,Ltd.
AERPCo.,Ltd.
Katsuya(Thailand)Co.,Ltd.
AAPICOITSCo.,Ltd.
AAPICOMitsuike(Thailand)Co.,Ltd.
AMactionCo.,Ltd.
ThaiTakagiSeikoCo.,Ltd.
AbleSanohIndustries(1996)Co.,Ltd.
MinthAAPICO(Thailand)Co.,Ltd.
HyundaiMotors(Thailand)Co.,Ltd.
SanohIndustries(Thailand)Co.,Ltd.
Papago(Thailand)Co.,Ltd.
SUBSIDIARY
ASSOCIATE
�0
�0
1985 • Registered Able Autoparts Industries Co., Ltd. (AAPICO). At the same time, started as the FordAssemblerandDistributor.
1986 • StartedoperationsatleasedfactorylocatedinMinburi,Bangkok.
1990 • PurchasedownmachinesandmovedtoaleasedfactoryatRangsit,Pathumtaniwith200employees.
1995 • SignedTechnicalAgreementwithKeylexCorporationofJapantomanufacturefueltanksforFordandMazdapickups.
1997 • Completed1stAAPICOFactoryon15raioflandinHitechIndustrialEstate,Ayuthaya. • Established1stJapanesejointventurewithSanoh(Japan)namedAbleSanohIndustriesCo.,Ltd.on
10raioflandinHitechIndustrialEstate,Ayuthaya.
Key Milestones
2002 • Fulloperation,545employees,ISO14001. • ListedontheStockExchangeofThailand(SET)onOctober17th,2002.2003 • PurchasedParishStructuralProductscompanyfromDanaCorporation,USAandrenameditAAPICO
AmataCo.,Ltd.
2004 • ExpandedtoChinabyacquiringKunshanChaitai-XinchengPrecisionForgingCo.,Ltd.,aforgingand
machiningcompany. • Issued RO (4.2 million shares at Baht. 80) and secondary PO (1.8 million shares at Baht. 148) in
NovembertoraiseBaht600million. • Establisheda30%jointventurewithFischerTech,aplasticinjectionmanufacturingcompany.
2005 • Established strategic global partnership with Sojitz Corporation - invested 15% equity in AAPICOHitechPLC.
• EstablishedAAPICOShanghai,amachiningcompanyinShanghai,China. • AchievedISO/TS16949:2002certification.
2006 • Acquired60%ofAbleITSCo.,Ltd.,acarnavigationsystemcompany(laterrenamedAAPICOITS) • EstablishedanewstrategicjointventureinThailandwithMitsuikeCo.,Ltd.ofJapan,namedAAPICO
MitsuikeCo.,Ltd. • InvestedinJackspeedCo.,Ltd.,Singapore-basedlistedcompany. • EstablishedAAPICOHitechPartsCo.,Ltd.on15raioflandinHitechIndustrialEstate,Ayuthaya.
Annual Report 2012
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2007 • AcquiredKPNPLC.andrenameditAAPICOForgingPLCandAAPICOPlasticsPLC. • Signed Technical Agreement with Edscha of Germany for technical collaboration to manufacture
door-checks,hingesandparkingbrakes. •SignedTechnicalAgreementwithKautexTextronGmbH&CoofGermanytomanufactureplasticfueltanks.
2008 • EstablishedMinthAAPICO (Thailand)Co., Ltd., a joint venturewithMinthCorporation ofChina to
manufacturedoorsash. • Constructed 3 new factories on 100 rai of land in Amata City, Rayong (namely AAPICO Hitech
Rayong,AAPICOPlasticsRayong,andMinthAAPICO(Thailand)Co.,Ltd.)
2009 • EstablishedAAPICOStructuralProductsCo.,Ltd.on40raioflandinAmataNakornIndustrialEstate,
Chonburi.
2010 • Commenced operation of AAPICO Hitech PLC’s second factory at Amata City Industrial Estate,
Rayong. •EstablishedThaiTakagiSeikoCo.,Ltd.,ajointventurebetweenAAPICOHitechPLC.,TakagiSeikoof
JapanandSojitz,tomanufactureplasticsparts. • CelebratedAAPICOGroup’s25thAnniversaryonNovember8th, 2010atGrandHyattErawanHotel
Bangkok. • PurchasedanewpieceoflandinKunshan,Chinawiththesizeof54.57muwhichisequivalentto36,380
squaremeters.
2011 • Acquired49%ofAAPICOITSSdn.Bhd.(Malaysia)toexpandcarnavigationbusinessinMalaysia. • Completedtheconstructionof3SHondaShowroomsinPetalingJayaandKajang,Malaysia. • AAPICOHitechPLCwasfloodedandfactoryinundatedto2.2metersofwater.
2012 • Kunshannewfactorystartedoperation.
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��Revenue Structure
Sales
Con
trib
utio
n Sa
les
Con
trib
utio
n
Dies, Jigs and OEM Parts Manufacturing
Sales Trend 2010-2012 Designandmanufactureofthefollowingparts:• Jigs&Dies• ChassisFrame• Stamping/PressParts• ForgingandMachiningParts• PlasticPartsandFuelTankSystems
Sales
Con
trib
utio
n
Sales Trend 2010-2012 Salesandafter-salesservicefor:• Ford• Mitsubishi• Honda
Sales Trend 2010-2012 Manufactureanddevelop:• Maps• CarNavigationSoftware
CarNavigation0.2%
CarDealership24.6%
Forging&Plastics19.5%
PressParts22.8%
ChassisFrame31.5%
Jigs&Dies1.5% 2010 2011 2012
8,219 7,851
12,643
2010 2011 2012
3,087 2,896
4,134
2010 2011 2012
36
39
34
(Unit:MillionBaht)
(Unit:MillionBaht)
(Unit:MillionBaht)
Car Navigation
Car Dealership
Annual Report 2012
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AAPI
CO
Gro
up B
usin
ess
Busine
ss U
nits
TH
AILA
ND
OVE
RSEA
S
1
OEMAutoPartsManufacturing
4
CarDistributor&Dealership
5
CarNavigation
6
Others
ThemainbusinessesoftheCompanyanditsaffiliatesmaybecategorizedasfollows:
ChassisFrame
PlasticPartsandPlasticFuelTank
SteelFuelTankSystem
ForgingandMachiningParts
BrazedSteelTubing
MetalStampingParts
EngineeringResearch&Development
FuelLines,BrakeLines,EngineParts
InvestmentActivities,Merger&Acquisition
OracleSystem
ManufactureofAccessoriesforTransportation
2
Design&ManufactureofAssemblyJigs
3
Design&ManufactureofAssemblyDies
RoofDitchMolding,BeltLineMolding,
DoorSash
SanohIndustries(Thailand)Co.,Ltd.
AAPICOAmataCo.,Ltd.
AAPICOStructuralProductsCo.,Ltd.
AAPICOShanghaiCo.,Ltd.
AAPICOForgingPLC.
KunshanChaitai-XinchengPrecision
ForgingCo.,Ltd.
AbleSanohIndustries(1996)Co.,Ltd.
AAPICOHitechPLC.
AAPICOHitechPartsCo.,Ltd.
AAPICOMitsuike(Thailand)Co.,Ltd.
AAPICOHitechPLC.(RayongBranch)
AAPICOPlasticsPLC.
ThaiTakagiSeikoCo.,Ltd.
Katsuya(Thailand)Co.,Ltd.
MinthAAPICO(Thailand)Co.,Ltd.
AAPICOHitechPLC.
AAPICOHitechToolingCo.,Ltd.
AAPICOHitechPLC.
AbleMotorsCo.,Ltd.
TenegaSetiaResourcesSdn.Bhd.
NewEraSalesCo.,Ltd.
NewEraSales(M
)Sdn.Bhd.
HyundaiMotor(Thailand)Co.,Ltd.
AMactionCo.,Ltd.
AAPICOITSCo.,Ltd.
Papago(Thailand)Co.,Ltd.
AAPICOEngineeringCo.,Ltd.
AAPICOInvestmentPte.Ltd.
AAPICOEngineeringSdn.Bhd.
AbleITSPte.Ltd.
AERPCo.,Ltd.
AAPICOJackspeedCo.,Ltd.
JackspeedCorporationLtd.
AAPICOITSSdn.Bhd.
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��Main Businesses
AAPICO HITECH PUBLIC COMPANY LIMITED [AH]
AAPICOHitechPLC.was founded in1996and listedon
theStockExchangeofThailand in2002.TheCompany’s
main businesses initially were to design, produce, and
installassembly jigs,stampingdies,andOEMautoparts,
including floor parts, cross members, pillars, brackets,clips, fuel and tanks, since then it has progressed to produce plastic, forging and frame components. The
Companyhasinvestedinotherbusinessesassociatedwiththeautomotiveindustryincludingcardealership,car
navigationsystems,etc.TheAAPICOGroupcomprisestotalof30companies(21inThailandand9overseas).
AAPICOHitechPLC.hasapaid-upcapitalofBaht268.874million.ThemainshareholdersareMr.YeapSwee
Chuan’s Group holding 39.65% and Sojitz Corporation holding 15.75% of total outstanding shares. The
Companyissellingmainlytotheleadinglocalautomotiveassemblers.
A) OEM AUTO PARTS MANUFACTURING
1) AAPICO AMATA COMPANY LIMITED [AA]
AAPICO Amata Co., Ltd.’s main business is to produce pickup truck
ChassisframessuppliedtoIsuzuMotors(Thailand)forthenewandold
IsuzuD-MaxandGeneralMotorsforChevroletColorado.
AAPICOAmataCo., Ltd. iswhollyownedbyAAPICOHitechPLC.with
paid-upcapitalofBaht800million.
3) AAPICO PLASTICS PUBLIC COMPANY LIMITED [AP]
AAPICO Plastics PLC.’s main business is to manufacture automotiveplasticparts,includingautomotiveplasticfueltanks.
AAPICOPlasticsPLC. iswhollyownedbyAAPICOHitechPLC.throughholdingofAAPICOForgingPLC.withpaid-upcapitalofBaht150millionThe main customers are Auto Alliance Thailand, GM, Yamaha andJohnsonControl.Thereare2factoriesat1. BangpleeIndustrialEstateSamutprakarn
2. AmataCityEstateRayong
2) AAPICO FORGING PUBLIC COMPANY LIMITED [AF]
AAPICO Forging PLC.’s main business is to manufacture automotive
forged and machined parts including steering and suspension system,
hubs,balljoints,axleandengineparts.
AAPICO Forging PLC. is wholly owned by AAPICO Hitech PLC. with
paid-upcapitalofBaht500million.ThemaincustomersareAutoAlliance
Thailand,DanaSpicer,GKNDriveline,THKRhythm,Yamaha,andMAGNA.
Annual Report 2012
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5) AAPICO STRUCTURAL PRODUCTS COMPANY LIMITED [ASP]
AAPICO Structural Products Co., Ltd.’s main business is to produceautomotiveChassisframessuppliedto IsuzuMotors(Thailand)for IsuzuD-Maxpickuptruck.
AAPICOStructuralProductsCo.,Ltd.iswhollyownedbyAAPICOHitechPLC.withpaid-upcapitalofBaht200million.
6) AAPICO MITSUIKE (THAILAND) COMPANY LIMITED [AMIT]
AAPICOMitsuike (Thailand)Co.,Ltd.wasestablished initially to focusonengineeringandmarketingpresspartsfordomesticsalestoNissan.Futureexpansionisalsoplannedinlinewithexpansionofmanufacturingfacility.
AAPICOMitsuike(Thailand)Co.,Ltd. is jointlyownedbyAAPICOHitechPLC. and Mitsuike (Japan) with equity participation of 51% and 49%respectively.Thecompanyhaspaid-upcapitalofBaht33million.7) KUNSHAN CHAITAI-XINCHENG PRECISION FORGING
COMPANY LIMITED [KCX] - China
KunshanChaitai-XinchengPrecisionForgingCo.,Ltd.’smainbusiness istomanufacture forged steel andcopperparts suchas connecting rodsandelectricalswitchcontactorsrespectively.
Kunshan Chaitai-Xincheng Precision Forging Co., Ltd. is wholly owned byAAPICO Hitech PLC. with paid-up capital of USD 6.1 million. The maincustomersareSGMW,Schneider,Chery,WuxiMingyuandShandongWenming.
8) AAPICO SHANGHAI COMPANY LIMITED [AS] - China
AAPICOShanghaiCo.,Ltd.’smainbusinessistomanufactureautomotivemachinedparts to support our production atKunshanChaitai-XinchengPrecisionForgingCo.,Ltd.
AAPICOShanghaiCo.,Ltd.iswhollyownedbyAAPICOHitechPLC.withpaid-upcapitalofUSD2million.
A) OEM AUTO PARTS MANUFACTURING
4) AAPICO HITECH PARTS COMPANY LIMITED [AHP]
AAPICOHitechPartsCo., Ltd.’smainbusiness is tomanufactureOEM
PressPartsforautomotivecarassemblersincludingfloorparts,brackets,
etc.TheCompanyalsoproducesharddiskdrivecomponents.
AAPICOHitechPartsCo.,Ltd. iswhollyownedbyAAPICOHitechPLC.
with paid-up capital ofBaht 120million. Themain customers areAuto
AllianceThailand,Nissan,Honda,IsuzuandToyota.
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9) ABLE SANOH INDUSTRIES (1996) COMPANY LIMITED [ASICO]
AbleSanoh IndustriesCo.,Ltd.’smainbusiness is tomakebrake lines,fuellines,andenginepartsforautomotiveassemblersinThailand.
AbleSanohIndustriesCo.,Ltd.isjointlyownedbyAAPICOHitechPLC.,Sanoh Industrial (Japan), and Sojitz Corporation (Japan) withshareholdingpercentageof46%,51%and3%respectivelyandpaid-upcapital of Baht 118 million. The main customers are Auto AllianceThailand,Honda,Mitsubishi,NissanandToyota.
10) THAI TAKAGI SEIKO COMPANY LIMITED [TTSC]
ThaiTakagiSeikoCo.,Ltd.’smainbusinessistoproduceplasticpartsforautomotive customers, such as Thai Suzuki, Kawasaki, Yamaha andKeihin.
Thai Takagi Seiko Co., Ltd. is jointly owned by AAPICO Hitech PLC.,Takagi Seiko Corporation, And Sojitz Management (Thailand) Co., Ltd.with shareholding percentage of 49%, 49% and 2% respectively. TheCompanyhaspaid-upcapitalofBaht27million.
11) MINTH AAPICO (THAILAND) COMPANY LIMITED [MA]
MinthAAPICO(Thailand)Co.,Ltd.’smainbusinessistodesign,produce,and sell automotive components including door sash, trim parts,decorativepartsandroofracks.
MinthAAPICO (Thailand)Co.,Ltd.’s is jointlyownedbyAAPICOHitechPLC. and SINOONEHolding, a wholly-owned unit ofMinth Group Ltd.(China), with the shareholding of 40% and 60% respectively. Thecompanyhaspaid-upcapitalofBaht378.5million.ThemaincustomersareAutoAllianceThailand,GeneralMotors,NissanandFordIndia.
12) SANOH INDUSTRIES (THAILAND) COMPANY LIMITED [SI]
Sanoh IndustriesCo.,Ltd.’smainbusiness is themanufactureofFultonbrazedsteel tubingsold todomesticcustomersaswellasexported toASEANcountries.
Sanoh Industries Co., Ltd. is held 20% by AAPICO Hitech PLC. withpaid-upcapitalofBaht146.25million.ThemaincustomerarethemajorOEMs.
A) OEM AUTO PARTS MANUFACTURING
Annual Report 2012
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1) AAPICO HITECH TOOLING COMPANY LIMITED [AHT]
AAPICO Hitech Tooling Co., Ltd.’s main business is to design and
manufacture assembly jigs, for both export and to support AAPICO
HitechPLC.’soperations.Inthepast3years,AAPICOHitechToolinghas
suppliedJigstoRenault,Ford,BMW,MercedesBenz,Mazda.
AAPICOHitechToolingCo.,Ltd.iswhollyownedbyAAPICOHitechPLC.
withpaid-upcapitalofBaht65million.
C) CAR DEALERSHIPS
1) ABLE MOTORS COMPANY LIMITED [AM]
Able Motors Co., Ltd. is a car dealer for Mitsubishi vehicles involving
sales and after-sales service with 2 showrooms and service center
locatedinNavanakornandLadprao.
AbleMotorCo.,Ltd.iswhollyownedbyAAPICOHitechPLC.withpaid-
upcapitalofBaht20million.
2) NEW ERA SALES COMPANY LIMITED [NESC]
NewEraSalesCo.,Ltd.isacardealerforFordvehiclessupportingboth
salesandafter-salesservicewithtotalof2showroomsinRamindraand
SamutprakranProvince.
NewEraSalesCo., Ltd. iswholly ownedbyAAPICOHitechPLC.with
paid-upcapitalofBaht20million.
3) NEW ERA SALES (M) SDN. BHD. [NESM] - Malaysia
NewEra Sales (M) Sdn. Bhd. is aHonda dealershipwith a showroom
andservicecenterlocatedinKajang.
NewEraSales(M)Sdn.Bhd.isjointlyownedbyAAPICOHitechPLC.and
Tenaga Setia Enterprise Sdn. Bhd., with equity participation of 49% and
51%respectively.Thecompanyhaspaid-upcapitalofRM1.5million.
4) TENAGA SETIA RESOURCES SDN. BHD. [TSRS] - Malaysia
Tenaga Setia Resources Sdn. Bhd. is a Honda dealership with a
showroomandservicecenterlocatedinPetalingJaya.
Tenaga Setia Resources Sdn. Bhd. is jointly owned by AAPICO Hitech
PLC. and Malaysian Investors with equity holding of 49% and 51%
respectively.Thecompanyhaspaid-upcapitalofRM6million.
B) ASSEMBLY JIGS
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5) HYUNDAI MOTOR (THAILAND) COMPANY LIMITED [HM]
Hyundai Motor (Thailand) Co., Ltd. is a sole distributor responsible for
manufacturingmarketing,salesandafter-salesserviceofbothCKDand
CBUmodelofHyundaicarsinThailand.
Hyundai Motor (Thailand) Co., Ltd. is jointly owned by AAPICO Hitech
PLC., Sojitz Corporation (Japan), and Sojitz Asia Pte with shareholding
percentageof30%,55%and15%respectively.Thecompanyhaspaid-
upcapitalofBaht550million.
D) CAR NAVIGATION
C) CAR DEALERSHIPS
1) AAPICO ITS COMPANY LIMITED [AITS]
AAPICO ITS Co., Ltd.’s main business is to market, service, and sellPOWERMAPCarNavigationsystemincludingbothsoftwareandmap.
AAPICO ITS Co., Ltd. is owned by AAPICO Hitech PLC. with 60% ofshares.ThecompanyhaspaidupcapitalofBaht100million.ThemaincustomersareJVC,Priority,Zulexandothercaraccessorydealers.
2) AAPICO ITS CO SDN. BHD. [AITSM]
AAPICO ITS CO Sdn. Bhd. was established in 2011 to expandPOWERMAPCarNavigationintotheMalaysianMarket.POWERMAPhasalreadymade a significant impact on themarket, despite only recentlylaunchingintheMalaysianMarket.
AAPICOITSCOSdn.Bhd.isownedbyAAPICOITSCo.,Ltd.andotherMalaysian Investors with shareholding percentage of 49% and 51%respectivelywithpaidupcapitalofRM500,000.
3) A MACTION COMPANY LIMITED [AMAC]
A Maction Co., Ltd.’s main business is to develop and manufacturesoftware for Car Navigation system called “POWERMAP” which issuppliedtoAAPICOITSCo.,Ltd.
AMactionCo.,Ltd.isjointlyownedbyAAPICOHitechPLC.andMactionTechnology (Taiwan) Inc. with equity participation of 51% and 49%respectivelyandpaid-upcapitalofBaht10million.
4) PAPAGO (THAILAND) COMPANY LIMITED [PPG]
Papago(Thailand)Co.,Ltd.’smainbusiness isdevelopingcarnavigationsoftwareandsaleofnavigationhardware.
Papago(Thailand)Co.,Ltd. is jointlyownedbyAAPICOHitechPlc.andMaction Technology (Taiwan) Inc. with equity percentage of 12% and88%respectively.ThecompanyhaspaidupcapitalofBaht10million.
Annual Report 2012
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E) OTHERS
1) AAPICO ENGINEERING COMPANY LIMITED [AE]
AAPICO Engineering Co., Ltd. focused on CAE (Computer Aided Engineering), programming, engineering,
consultancy,engineeringdesignandengineeringresearch&development.
AAPICOEngineeringCo.,Ltd.iswhollyownedbyAAPICOHitechPLC.withpaid-upcapitalofBaht10million.
2) AAPICO ENGINEERING SDN. BHD. [AEM] - Malaysia
AAPICO Engineering Sdn. Bhd. is set up for future business potential. Currently, it owns a piece of land in
MalaysiatobeusedforbuildinganewshowroomforsellingHondacars.
AAPICOEngineeringSdn.Bhd.isownedbyNewEraSales(M)Sdn,Bhd.andTenagaSetiaResourcesSdn.Bhd.
withshareholdingof51%and49%respectivelyandapaid-upcapitalofRM1million.
3) A ERP COMPANY LIMITED [AERP]
AERPCo.,Ltd.isestablishedtosupporttheOracleimplementationfortheAAPICOGroup.
AERPCo.,Ltd.is88%ownedbyAAPICOHitechPLC.withpaid-upcapitalofBaht1.25million.
4) AAPICO INVESTMENT PRIVATE LIMITED [AIPL] - Singapore
AAPICOInvestmentPte.Ltd.wasestablishedwiththepurposeofcarryingontransactionsrelatedtomergerand
acquisition.
AAPICOInvestmentPte.Ltd.iswhollyownedbyAAPICOHitechPLC.withpaid-upcapitalofSGD6.97million.
5) ABLE ITS PRIVATE LIMITED[AITSPL] - Singapore
AbleITSCo.,Ltd.isaholdingcompanyforbusinessoperationinSingapore.AbleITSCo.,Ltd.iswhollyowned
byAAPICOITSCo.,Ltd.Withpaid-upcapitalofSGD310,000.
6) AAPICO JACKSPEED COMPANY LIMITED [AJ]
AAPICOJackspeedCo.,Ltd.’smainbusinessistomanufacturesportbarsforpick-uptrucks.
AAPICOJackspeedCo.,Ltd.isjointlyownedbyAAPICOHitechPartsCo.,Ltd.andJackspeedCorporationwith
equityparticipationof60%and40%respectively.Thecompanyhaspaid-upcapitalofBaht20million.
7) JACKSPEED CORPORATION LIMITED [JCL] - Singapore
JackspeedCorporationLtd. is acompany listed in the stockexchangeofSingapore thatmanufacture leather
seatsandaccessoriesfortheautomotiveindustry.
JackspeedCorporationLtd. is18%ownedbyAAPICO InvestmentPte.Ltd.withpaid-upcapitalofSGD21.8
million.
8) KATSUYA (THAILAND) COMPANY LIMITED [KT]
Katsuya (Thailand) Co., Ltd.’s main business is to manufacture surface treatment-water printing for plastic
productsandfabricflockingforautomotiveinteriorpanels.
Katsuya(Thailand)Co.,Ltd.isjointlyownedbyAAPICOHitechPLC.andaSingaporeInvestorwithshareholding
of76%and24%respectively.Thecompanyhaspaid-upcapitalofBaht28.5million.
�0
�0Competition and Industrial Trend
2012 was considered the golden year of Thailand
Automotive Industry. Following the severe natural
disasterattheendof2011whichhadhugeimpacton
Thailand’sautomotivebusiness, inparticular,disrupted
the supply chain structure, all automobile and parts
manufacturers have rapidly recovered and resumed
their operations. Honda, being the most heavily
affectedOEMwithfloodinundationwithinitspremises,
hadresumedtheiroperationsinApril2012.
Duetothe2011yearendfloodcrisis,cardemandwas
carriedoverfromyear2011to2012.Togetherwithan
extension of government policy for the first-time car
buyers, the domestic car demand sharply increased
with outstanding orders and car sales of 1.4 million
unitsin2012.
Totalcarproductionintheyear2012reached2,453,717
units, which were the highest record in the car
production history, representing an increase of 68%
comparedtoyear2011.Domesticvehiclesalesin2012
werearecordof1,436,335units,postingayear-on-year
growthof81%.Exportcarsaleswere1,026,671units,
whichwasanincreaseof39%comparedtoyear2011.
Thailand Car Production 2005-2012
PassengerCar 1-TonPickupCar Others
2005 2006 2007 2008 2009 2010 2011 2012
3,000
2,500
2,000
1,500
1,000
500
- 278 299 329 399 313 554 538 957
823 872 948 975 671 1,067 899
1,452
Thailand Domestic Car Sales 2005-2012
PassengerCar 1-TonPickupCar Others
2005 2006 2007 2008 2009 2010 2011 2012
1,600
1,400
1,200
1,000
800
600
400
200
-278
823
Unit:1,000
672
666
362
366
347
388
239
276
239
246
183
386
195
329
188
470
Unit:1,000
Annual Report 2012
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Thailand Automotive Annual Production Capacity
The Automotive Industry is one of main industries inThailand. It accounts for about 10% of the country’sgross domestic product (GDP). The sector generatesemployment for over 500,000 jobs of skill labor andcreates value in related downstream and serviceindustries such as financial services, insurance andafter sales service. On a regional and global arena,Thailand ranked the firstamongASEANcountriesandthe9thintheworldrankingin2012.
In 2013, the Thai automotive industry wil l addproduction capacity (around 400,000 units) from thenew facilities of Isuzu, Toyota, Nissan, and GeneralMotors. The forecast of annual car production isexpected to maintain at around 2.5 million units in2013,withthetargettoachieveannualproductionof3million vehicles by 2015. The effect of the first carbuyergovernmentpolicyisseentocontinuetoatleastinthefirsthalfof2013asremainingofapproximately534,000 units of first cars were carried over to year2013. The estimate of car consumption for domesticand export business are anticipated at around 1.4millionunitsand1.1millionunitsrespectively.
R&D facility Outline
TOYOTA *ToyotaMotorAsiaPacificEngineer&Manufacturing(TMAP-EM),startedoperationin2007,
(TMAP-EM) locatedatBangna-TradKM29,issupportingdevelopmentoflocalmadevehicleforAsia,Oceania,
andMiddleEast,andsupportlocalToyotavehicleproductioninthearea.
HONDA *HondaR&DAsiaPacificCo.,Ltd(HRAP),inauguratedonNovember2nd2009,atRamindrais
(HRAP) responsibleforR&DforAsia/Oceaniaregion.
NISSAN *Startdevelopmentexceptveryearlystage(Testcourse,engine/chassisexperimentalequipment)
(NTC-SEA) * Increasemanpowerto370people(includingIndonesianbranch)before2016.
ISUZU * IsuzuTechnicalCenterofAsiaCo.,Ltd.(ITA),firstestablishedin1991inThailand,isengaging
(ITA) vehicledevelopmentasAsianR&Dbase.
Thailand Automotive Production Capacity
2013 New
Car Maker Passenger Pick up Others Total Investment 2014/2015 car Truck (million Baht)
Toyota 280,000 660,000 940,000 980,000
Mitsubishi 150,000 250,000 400,000 500,000
Isuzu - 330,000 26,000 356,000 356,000
AutoAllianceThailand 150,000 150,000 300,000 300,000
Nissan 140,000 100,000 240,000 11,000 370,000
Honda 240,000 240,000 17,200 360,000
Ford 200,000 200,000 200,000
GeneralMotors 40,000 160,000 200,000 200,000
Suzuki 135,000 135,000 200,000
Others 50,000 10,000 20,000 80,000 80,000
Total 1,385,000 1,660,000 46,000 3,091,000 28,200 3,546,000
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2012 was the most challenging year in the AAPICO
history.Westartedtheyearwithhardworktorecover
the factory and our business back from the flood
damages to the normal operations and to meet
demands from our customers. All OEMs expect to
regain their lost volume during the flood in 2011.
Together with the “First Car Project”, the favorable
policy from the government to refund exercise tax to
first-car purchasers, almost all carmakers achieved a
record high of their production volume in year 2012.
AAPICO Hitech has successfully accomplished these
challengeswiththefastestrecoveryamongfactoriesin
Ayuthaya and ramp up production capacity and was
abletosupplyqualitypartstocustomers.
After thesevere floodingcrisis inThailand’shistory in
2011,the industryhasbouncedbackevenstronger in
2012.For theyear2013,Thailandautomotive industry
is expected to grow significantly with the strong
support from the Thai government to make Thailand
become one of Asia’s leading centers for the
automotive industry, as well as ensure that major
manufacturers continue to regard this country as an
attractiveproductionbaseinASEAN.
As a strong believer of local skills, AAPICO has its
beginninginthedesignandmanufactureofautomotive
assembly jigsbefore it ventured furtherafield into the
production of dies and OEM parts. Today, it is well
recognizedasaworld-classsupplierofsuchproducts,
whileitcontinuestogarnercapabilitiesandtechnology
fromacrosstheworld.TheCompanywillattainitsdual
goals of steadygrowth and seizingnewopportunities
to foster progress and leadership in the Thai
automotiveindustryinwaysthatcanbenefitthenation
andcontributetothesuccessofglobalOEMs.This is
inlinewiththeCompany’svisionandcanbeachieved
throughthecorephilosophyofbeingaleanandhappy
global company with excellent corporate governance.
AAPICOsetsitsgoalbyapplyingtheSQCDEMcriteria
asfollows:
S : Safety
Safetyalwayscomesfirst
Q : Quality
Quality built-in process, strive to achieve “0”
PPM
C : Cost
Competitivepricingatreasonablylowcost
D : Delivery
100%deliveryatalltimeswithJust-In-Time(JIT)
philosophy
E : Engineering
Kaizen mind in engineering and production
process
M : Management
Competent , Transparent , and Hands-on
Management
Our current customers view the Company as an
excellent manufacturing company with sustainable
SQCDEM attributes. It endorses AAPICO Group’s
ultimate business objective, that is, to enhance its
businessrelationshipswithallvaluablecustomers.
Future Projects Fol lowing a strong rebound in 2012, the Thai
automotive industry isstillexpectedtogrowfurther in
2013.Due to the recentproblemsof chineseemotion
against Japanese a new opportunity has arisen as
JapaneseOEMS’arerelocatingtothisregion.Hence,it
createsmoreopportunitiesforcountries intheASEAN
EconomicCommunity(AEC)to increasetheirbusiness
volume.
In the year 2013, the AAPICOGroup plans to launch
new models for Toyota, Isuzu and Ford and also
volumes increasesofseveralcurrentprojectsfromour
OEM customers. Furthermore, the Company plans to
expandbusinesswithTier1suppliers,aswellasTier
2. For the upcoming new models which will be
launched in the year 2014, the Company has started
the preparation to increase production capacity and
Business Operation Goals and Future Projects
Annual Report 2012
��
manpower to support these new models. For this
businessexpansion,theCompanyplansinvestmentsin
new machinery, for example, the 1,000 ton blanking
press at AAPICO Amata, and the new injection
machinesfor1,300tons,1,600tonsand2,500tonsat
AAPICOPlastics. In addition, theCompanyalsoplans
to increaseutilizationofcurrent facilities.Withsupport
from our subsidiary company, AAPICOHitech Tooling,
theCompanyplanstochangefrommanualprocessto
automation process in order to improve productivity
andreducetherelianceonhumanmanpower.
The growth in the automobile market is expected to
have positive impact on our navigation system
business.Theyear2012hasmarkedanothersignificant
milestone for AAPICO ITS Co., Ltd (AITS) as it has
steppedintotheneweraofnavigationtechnologywith
thelaunchofthenewgenerationofnavigationsystem,
thePOWERMAPIQwithCONNECTIVITIY.POWERMAP
IQ is equipped with the connected and integrated
technology, enabling the system to access the traffic
managementsystem,extended location-basedservices
and various online services. AITS has secured a
contract to supply POWERMAP IQ navigation system
toProtonPreve,whichhasbeenmarketedinThailand
since December 2012. AITS is currently working with
theR&D teamsof severalOEMcustomers to achieve
its2013target.
In line with the increasing demand in the region and
beyond, the AAPICO Group will strive to look for
businessexpansions,opportunities,andventures in its
overseas business development, particularly in China
andMalaysia,toenhancethepositionoftheCompany
asaglobalplayer.
For Kunshan Chaitai-Xincheng Precision Forging
Co., Ltd (KCX), 2012 has been an eventful year as it
has moved operations to the first new fully owned
37,000 square meters manufacturing facility and has
achieved normal production within 2 months after
moving in. KCX has also successfully secured new
cracking connecting rod projects from Shanghai
GeneralMotorsWuLingforthe1.2and1.5litrenormal
aspirated and turbo engine, as well as the 1.4 litre
connectingrodsfromGeneralMotors.Inanticipationof
a potentially greater demand from their intensified
marketing effor t, KCX focus on the productivity
improvementisthemajortargetfortheyear2013.
The year 2012 was also a remarkable year for the
dealership operations inMalaysia. New Era Sales (M)
Sdn Bhd (NESM) won the 2012 Dealer of the Year
Silver Achiever award at Honda National Dealer
Convention.This is the first year thatHondaMalaysia
conducts this program where it evaluates dealer
performanceonsales,service, facilityandprocess.As
theSilverAchiever,NESMis rankednumber3among
66dealers in thenation.At thesameHondaNational
Dealer Convention, Tenaga Setia Resources Sdn Bhd
(TSR) was also named the Qualifier of 2012 CEO
Award Tier 2 Dealer, which is an award given to the
top 20 dealers out of 66 dealers. For the year 2013,
both NESM and TSR have set the target to be
regardedamongthetop10dealersoftheCEOAward.
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��Risk Factors
External Risk 1. Political Risk
a. Description:Thegovernmentpolicyforthefirst-
timecarbuyershadstimulatedthedomesticcar
sales and the country’s automotive industry in
the year 2012. After the completion of the
programattheendof2012,growthofdomestic
car production is seen to slow down in 2013,
However,theindustryislikelytostillbenefitfrom
theprogramduringthefirsthalfofthisyearfrom
thebacklogofcarscarriedoverfromlastyear.
b. Reason:Favorablepoliciesfromthegovernment
have significant impact on the investment and
profitabilityoftheautomotiveindustry.
c. Possible outcome: The uncer tainty and
disagreement in the cabinet may lead to the
declineofconsumer’sandinvestors’confidentin
theThaiautomotiveindustry.
d. Likelihood: In view of current situation, it is
difficult topredictoutcomeduetohigh levelof
uncertainty.
e. Risk Management system: the Company
monitorscloselyongovernmentpolicyinorderto
manageoperationsaccordinglyandtrytoachieve
thebestoutcomefromgovernmentpolicies.
2. Economic Risk
a. Description: The economic growth in 2013 is
seentobeslightlylowerthantheyear2012,due
tothefluctuationsintheglobaleconomy.
b. Reason:theCompanydependshighlyonsupply
anddemandofthemarketasawhole.
c. Possible outcome: A decline in the economy
would severely reduce consumption of goods.
The demand for cars would fall sharply as
consumers postpone their needs for newer
modelsofcarsduetotheirdecreaseinincome.
Respectively, automakers in the market would
reduce their orders, and the Company would
losesales.
d. Likelihood: Themain factors to push the 2013
economic growth are the internal factorswhich
effectedfromthegovernmentpolicysuchasrice
pledgingpolicy,increaseinminimumwages,the
backlogsofthefirst-timecarbuyer’spolicyfrom
theyear2012andprivateinvestors’confidentin
thisgovernment.
e. Risk Management system:Topmanagement is
awareoftheconsequences,andthushassetup
a close monitoring system focusing on cost
reduction and production efficiency. These
methodswouldhelptominimizethebottomline
effect. In addition, the AAPICO group has a
diversified portfolio of investment as well as
having subsidiaries in foreign countries, namely
China andMalaysia. This diversification would
helpreducetheconcentrationoftheimpact.
3. Risk from uncertainty in raw material price
fluctuation
a. Description:Riskofchangeinsteelprice
b. Reason: Steel is the Company’s main raw
material used in the production of auto part
processes. The steel price is highly volatile
depending on supply and demand in the
worldwidemarket.
c. Possible outcome: Our profitability will be
directly affected by any raw material cost
increasesinceitwillhaveadirectimpactonour
valueadded,andhencereduceourprofitability.
d. Likelihood:Thevolatilityofthesteelpriceinthe
market is relatively high, and the trend is
expectedtocontinuouslyincreaseovertime.
e. Risk Management system: The Company has
thepolicytousecentralizedpurchasing,whichis
appliedto80%ofmaterialused.Thecentralized
purchasing refers to a system in which our
customers choose the material supplier for the
Company, and then the Company purchases
mater ial at designated prices set by the
Annual Report 2012
��
customers. If the price of material moves, the
supplier adjusts the price (up or down) and
customers compensate for such an adjustment.
This means AAPICO transfers any risk to the
customers. Therefore, the fluctuation in steel
price does not have significant impact on
companyperformance.
4. Exchange rate risk
a. Description: Risk of fluctuation in the foreign
currencies thatmight affect theCompany’s net
profit.
b. Reason: the AAPICO Group has both income
and expenses in many foreign currencies such
asUSDollar,JapaneseYEN,Euro,SwissFranc,
BritishPoundandSwedishKroner,etc.However,
main currencies are US Dollar, Japanese YEN
andEuroasshowninthefollowingtable:
c. Possible outcome:The fluctuation in exchange
ratesmay result in a decrease of revenue and
increaseofexpensesorviceversa.However,the
exposure level of such an outcome is relatively
low since the majority of our income and
expensesareincurredinThaiBaht.
d. Likelihood: The world market is constantly
changing and the exchange rates move in
accordance with the market. There is high
volatilityinforeignexchangerate.
e. Risk Management system:theCompanyhasthe
policyofnottakinganyrisksfromthevolatilityof
foreign exchange rate. Hence, the Company
would enter the forward or option contract in
order to reduce risks for businesseswhich have
bothincomeandexpensesinforeigncurrency.
5. Interest Rate risk
a. Description:Riskof fluctuation in interest rates
whichaffectthefinancingcostsoftheCompany.
b. Reason:Thenatureof theCompany’sbusiness
requiresahighamountofupfrontinvestment,at
least2-3yearsbeforemassproduction(pointof
receiving cash). Therefore, the Company needs
funding, in this case debt financing, to support
such expansion. Currently, the Company has
severaltermloansoutstanding.Theinterestrates
on these loans are floated interest rate, which
expose the Company to risk of interest rate
fluctuation.
c. Possible outcome:Asthemarkethasrecovered
fromrecentrecession,thetrendofinteresttends
to rise. Therefore,with floated rate interest, the
Companywill be experiencing a higher cost of
f inancing which would directly af fect the
profitabilityoftheCompany.
d. Likelihood: theMeeting of theMonetaryPolicy
Committee in late 2012 and early 2013 stated
that interest rate would still remain unchanged
as there are no signs of large capital inflows.
Thereis,however,apossibilitythatinterestrates
arelikelytoincreaseinthefuture.
e. Risk Management system:Inordertomitigate
this risk, the Company has allocated some
portion of outstanding loans with fixed interest
rateswiththeBanksasfollows:
Currency Revenue Expense Usage (in thousands) (in thousands)
USDollar(USD) USD12,983 USD 7,525.81 Paymentforexpensesforoverseas,materials, machinesorspareparts JapaneseYen(YEN) None YEN 74,599.23 Paymentformachinesorspareparts Euro(EUR) None EUR 1,213.68 Paymentformachinesorspareparts
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According to the table above, the Company has
fixed approximately 34% of its existing debts in
2012.
6. Risk from natural disaster
a. Description: Risk from natural disasters in
Thailand or nearby countries in the related
supply chain of automotive industry. Examples
aretheTsunamiinJapanandthefloodcrisisin
thecentralpartofThailand,bothin2011.
b. Reason: Due to the Japanese Tsunami, many
auto part makers and raw material suppliers
wereunable tosupplypartsorsteel,whichare
the main components for the Company’s
operations.Afewofthosecomponentshaveno
alternative supplier thus the Company was
unable to supply some parts to customers or
had to delay its production schedule. The Big
FloodhittheCompanyinOctober2011andput
thefactoryunderatalmost2.6metersofwater.
Theoperations in thehead-quarterhad tostop
and production lines were relocated to other
facilitiesthatwerenotflooded.
c. Possible outcome: Inboth incidents, theeffect
of natural disastershadadirect impacton the
company’s production. The Company’s inability
to generate revenue will impact the company’s
profitability. In addition, the mitigation and
recovery measures that the company has to
undergotoreducetheeffectsappearasasharp
increaseinexpense.
d. Likelihood: Natural disasters are unpredictable.
TheCompanybelievesthatthereisapossibility
thatnaturaldisasterwillstrikeagain.
e. Risk Management system:theAAPICOGroup’s
top management real izes the expensive
consequences theCompanywill faceafter each
natural disaster, thus setsup several policies to
mitigate the risks.TheCompanyhas facilities in
several locations in Thailand including Rayong,
Chonburi, and Samutprakarn. The Company
could move some production line to other
facilities if needed. Also, the multiple facilities
helpdiversifytheriskifanyofthefactorywould
be affected by natural disaster. In addition, the
Company is insured by the insurance company
to compensate for the flood and business
interruptions.Furthermore,withsupportfromthe
government in 2012, the Hitech Industrial Park
has completed the construct ion of dam
surrounded the whole area of industrial park.
Thisdamisaimedtopreventandmitigatelosses
whichmayoccurfromsuchcrisisinthefuture.
Internal Risks 1. High Reliance on only one Top Management
a. Description: The possible adverse effects that
results from high reliance on only one Top
Management.
b. Reason: Mr. Yeap Swee Chuan, President &
CEO, is not only the top management of the
Company, but also is responsible formanaging
sales and establishing strong relationships with
customers.
Principle Outstanding Hedge Ratio Interest Rate IRS
(as of Dec 2012)
Baht2,000million Baht1,640million 20% FDR(6month)+3.3% 5.65%
Baht1,200million Baht785.40million 35% MLR-1.75% 5.33%
36% MLR-1.75% 5.38%
Annual Report 2012
��
c. Possible Outcome: Without Mr. Yeap, the
Companymight face the riskof losingsales to
competitors due to the intense competition
withintheautomotiveindustry.
d. Likelihood: Currently, Mr. Yeap has no plan to
retire and continues to support the operation
anddevelopmentoftheCompany.
e. Risk Management system: The Company is
trainingnewmanagementteamsbyfollowingthe
Company’sobjectivesandpolicies.
2. Management control of major shareholder
groups
a. Description: Management holds the majority
sharesoftheCompanywhichcouldresultinthe
inabilitytoensurecheckandbalances.
b. Reason: Two major shareholder groups, the
Yeap family and Sojitz Corporation, together
holding a combined share of over 50% of the
Company’s registered and paid-up capital and
havemanagementcontrolovertheCompany.
c. Possible Outcome:Themajorshareholdersmay
control the agendas at the Shareholders’
Meetings. Therefore, otherminority shareholders
maybeunabletoaccumulatesufficientvotesto
ensure checks and balances for agendas
proposedbythemajorityofshareholders.
d. Likelihood: It is unlikely that the majority
shareholders will exercise absolute control over
matters that have conflict of interests because
the Company’s Board of Directors is consisted
of6independentdirectors,outof9directors,to
enhanceadequateinspectionoftheexecutives.
e. Risk Management system: Currently, these
independent directors are allowed to oversee
actions of the management. Also, transactions
that may cause conflict of interest are also
reviewed by theCompany’s audit committee in
order to ensure that the minority shareholders’
interestsareprotected.
3. Uncertainty of income from car assembly jigs
and dies
a. Description: The risk resulting fromuncertainty
of income from one of the Company’s project
basedbusinesses,carassemblyjigsanddies.
b. Reason:Thenatureof jiganddiesbusiness is
normally conducted on a project by project
basis.Withthecyclicaldemandfromautomotive
manufacturers where new models wil l be
launched every 3-5 years, the Company is
exposed to the risk of uncertain income from
thisbusiness.
c. Possible Outcome: Compared to other
businesses of the Company, car assembly jig
and dies currently had the highest uncertain
incomeduringtheyear.
d. Likelihood: As it is the business nature of car
assembly jig and dies, fluctuating income is
ratherinevitable.
e. Risk Management system:Inspiteofthisrisk,
theCompanydoeshavea long-termrelationship
with customers, alongwith high product quality,
whichenablesthebusinesstosecurethesalesof
jig anddies. In addition, theAAPICOgrouphas
grownsubstantiallyandmorethan50percentof
jiganddiesarecateredforinhouserequirement.
4. Competition within automotive components
manufacturing industry
a. Description: The automotive market is highly
competi t ive; the company faces intense
competition from auto part manufacturers in
respectivemarkets inwhich it operates.As the
competitionsintensify,theCompanyisatriskof
losingitsmarketshare.
b. Reason:Theautomotivecompanywillselectthe
auto part manufacturer before the end of the
modelline.TheCompanyawardedtheprojectis
ensuredtohaveordersforthewholeprojectlife,
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which ranges from4 to 10 years, according to
theproductlifecycle.Competitionisveryfierce
forautopartmanufacturersbiddingforprojects,
forthelowestpriceandthebestquality.
c. Possible Outcome: Losingpotential projects is
a r isk that could signi f icant ly af fect the
Company’s operations and theCompanywould
beatadisadvantageforfutureprojects.
d. Likelihood: The Company has a renowned
reputation inproducinghighqualityproductsat
very competitive prices, supported by efficient
services and coupled with punctual deliveries.
The Company has consistently achieved trust
frommostglobalOEMcompanies.
e. Risk Management system: Management
envisionedthattheCompanyshouldbealeader
intheautopartindustry,thushasequippedthe
Company with state of the art machines and
cuttingedgetechnology.Moreover,thecompany
hasalong-standingrelationshipwithgoodtrack
record making the Company one of the most
competitive automotive parts suppliers in the
market.
5. Quality Control
a. Description:Quality isakeysuccessfactorfor
anautopartmanufacturer.
b. Reason: In this highly competitive automotive
market, defective products are not acceptable.
Producing defective parts would have negative
impact on the Company’s reputation and
potentiallycauserecallsorseriousaccidents.
c. Possible Outcome: A recall can impact profits
andreputationoftheCompany.
d. Likelihood:theCompanyputsagreatemphasis
on quality control of its products in order to
meet thecustomers’ satisfaction. It is confident
that the riskassociatedwithquality controlwill
becontinuallyreduced.
e. Risk Management system: The Company has
the policy of 0% defective parts, thus has
extensively invested in standardizing and
controlling its product’s quality. The Company
has successfully passed and been certified for
ISO/TS 16949 for al l i ts par t companies.
Fur thermore, the Company has provided
warranty which normal ly is stated in the
purchasing contract which allows customers to
claimfordefectiveparts.
6. Labor relations
a. Description: The risk that labor disputesmight
haveaneffectontheoperations.
b. Reason:The laborunionandmembersarestill
notmatured.
c. Possible Outcome: Poor labor relation may
resultinindustrialdisputes.
d. Likelihood:Strikesmayoccuriflaborrelationis
weak.
e. Risk Management system: Having good
communication and training to create better
working atmosphere and working relationship.
Moreover,supportbenefitsandwelfarearealso
maintainedabovetheaverageindustrystandard.
7. Implementation for safety, environment and
communities
a. Description: The potential risk of dangers and
losses associatedwith safety, environment, and
communities.
b. Reason: By the nature of auto part business
and the production process, without a good
safetymanagement,theCompanyisexposedto
theriskoflosseswhichwillultimatelyaffectthe
staffsandstakeholders.
c. Possible Outcome:Ontheaspectofthesafety,
anyunsafeactorunsafeconditioncouldcause
anaccidentwhichmightresultindangerorloss
Annual Report 2012
��
of l imbs or l ives. On the aspect of the
environment and community, lack of good
management, including pollution control and
waste treatment, could have an adverse effect
on theoperatingproductivity, andhealthof the
Company.
d. Likelihood: The Company has set up a clear
policy concerning safety, environment and
communities along with continual training on a
regular basis. By emphasizing on design
process, manufacturing infrastructure and
manufacturing system, the Company believes
that potential losses and dangers have been
minimized.
e. Risk Management system: The Company has
setupactivities thatpromoteacleanandsafe
work environment, including 5S activities which
keep the factory clean and tidy to reduce
accidents. Fur thermore, the Company has
achievedtheEnvironmentalstandardISO14001,
a cer t i f ied standard for environmental
management. This serves as a proof for the
Company in its ability to effectively deal with
environmentalissues.
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�0Shareholding Structure and Management
Shareholding Structure AccordingtotheShareRegisterBookasofMarch19th,
2013,AAPICOHitechhasregisteredshares intotalof
268,874,300shares,comprisedof226,514,300ordinary
shares and 42,360,000 preferred shares. The top ten
shareholdersarelistedinthetablebelow.
Limited of Foreigner Shareholders AsofMarch19th,2013,theCompany’ssharesheldby
foreignerareaccountedat themaximum limitof49%
oftotalshares.
Shareholderswhohave themanagerialauthoritiesand
perform as authorized directors are Mr. Yeap Swee
ChuanandMrs.TeoLeeNgo.
Management Structure The management structure of AAPICO Hitech is
consistedofthreegroupsofcommitteesasfollows:
A. TheBoardofDirectors
B. TheAuditCommittee
C. TheNominationandRemunerationCommittee
A. Powers and Duties of the Company’s Board of
Directors
TheBoardofDirectorsshallhavethepowerandduty
tomanagetheCompany incompliancewiththe laws,
objects, and Articles of Association and resolution of
shareholderswithhonestyandcare,aswellasensure
thecompliancewith thecriteriaandregulationsof the
Stock Exchange of Thailand and the Securities and
ExchangeCommissionofThailandfortheshareholders’
interests.TheBoardofDirectors isresponsibleforthe
supervisionoftheCompany’smanagement inorderto
achievemaximumbenefit for theshareholdersanddo
sowithintheframeworkofgoodethicandgoodmoral
principle.
TheBoardofDirectorsmayauthorizedirectorstoform
an executive committee in order to perform any acts
except for thefollowing,whichcanbeperformedonly
afterobtainingtheapprovalfromtheshareholders.
1) The subject which the law requires of the
shareholders.
2) The transactions which the directors have interest
thereinandthatthelaworregulationsoftheStock
Exchange of Thailand require the resolution of
shareholders. For any transaction in which the
directors or other persons might have conflict of
interestwiththeCompanyortheaffiliatedcompany,
suchdirectorsorpersonswhohave theconflict in
thetransactionshallnothaveanyvotingrights.
ThefollowingcasesmustbeapprovedbytheBoardof
Directorsandtheshareholderswithavoteofnot less
than 3/4 of the total votes of the shareholders
attendingandentitledtovotefor:
1) Anysalesortransferoftheentireorsignificantpart
oftheCompany’sbusiness.
2) Anypurchase or taking over of other firmsby the
Company.
3) Anymaking,amendmentorterminationofcontracts
withrespecttothegrantingofaleaseofthewhole
orsignificantpartofthebusinessoftheCompany,
theassignmentofthemanagementofthebusiness
of the Company to any other person or the
amalgamation of the business with other persons
withthepurposeofprofitandlosssharing.
No. Shareholders Number of Holding shares %
1 YeapFamily 106,619,352 39.65%
2 SojitzCorporation 42,360,000 15.75%
3 Mr.PreechaLeelasithorn 6,100,000 2.27%
4 ThaiNVDRCo.,Ltd. 5,524,363 2.06%
5 Mr.SompongPhaoenchoke 5,509,700 2.05%
6 Ms.SuneeSereepanu 5,200,000 1.93%
7 Mr.VititPongpirodom 4,500,000 1.67%
8 Mr.VirojKosoltanawong 3,930,000 1.46%
9 Mr.SurinNapapruekchart 3,350,000 1.25%
10 Mr.KiattisakTritrungtatsana 3,075,100 1.14%
Annual Report 2012
��
4) TheamendmenttotheMemorandumofAssociation.
5) The increaseanddecreaseofcapital, the issuance
of debentures, the amalgamation or dissolution of
theCompany.
InsupervisingalltheCompany’sbusinesses,theBoard
ofDirectorshasdetermined tohave theauthorityand
responsibilityinapprovalofthefollowingmatters
1) The quar terly business per formances of the
Company in comparison to the plan and budget
and the consideration of the further trends of the
year.
2) Related-party transactions between the Company,
subsidiaries, associated companies and the related
persons in part of the transactions that do not
violate the regulations of the Stock Exchange of
Thai land and the Secur i t ies and Exchange
Commission.
3) Any transactions that would highly affect the
Company’s capital structure, financial status,
businessoperationstrategyandreputation.
4) Paymentoftheinterimdividends.
5) EmploymentofthePresidentandseniorexecutives.
6) DeterminationandChangeoftheapprovalauthority
oftheCompany.
7) The purchase of business and the participation in
co-investmentproject.
8) The change of policy and practical methods with
signi f icant ef fect on the account ing, r isk
managementandinternalaudit.
9) The appointment and the determination of the
authorityofthesub-Committee.
10)The proposal, appointment, and termination of the
Company’sdirectorsandsecretarystatus.
11)Any other actions in accordance with laws,
objectives,ArticlesofAssociationandresolutionsof
theshareholders’meeting.
B. Powers and Duties of Audit Committee
The scope of duties and responsibilities of Audit
Committeearedescribedasfollows:
1) Ensure that the Company maintains accurate and
sufficient financial statements in accordance with
theaccountingstandard.
2) Ensure that there is sufficient and efficient internal
control and internal audit by considering the
followingissues.
a. Give opinion on the appointment, transfer,
terminationandevaluationoftheperformanceof
the head of Internal Audit, in order that the
InternalAuditwouldhavetrueindependence.
b. ConsidertheindependenceoftheInternalAudit
byreviewingtheoperationreportaswellasthe
organizationstructureoftheInternalAudit.
3) Consider,select,andappointauditorbyconsidering
thefollowingissues:
a. Investigate and consider the independence of
theauditorby,forexample,consideringthenon-
audit services that may cause lack of
independence, such as by engaging in the set
upofaccountingsystem.
b. Call a meeting with the auditor without the
presence of the management at least once a
yearinordertoseektheobjectivityofauditor’s
opinion.
4) Ensure that the Company performs in accordance
with the Securit ies and Exchange laws and
regulations, regulations of the Stock Exchange of
Thailand, and laws concerning thebusiness of the
Company.
5) Consider the disclosure of information of the
Company formatters thatmayconstitutea related
transaction or have any conflict of interest to be
completeandaccurate.
6) Review the suitabi l i ty and adequacy of r isk
managementoftheCompany.
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7) Prepare the report of the Audit Committee to be
revealed in the annual report of the Company,
whichshallbesignedbytheChairmanoftheAudit
Committee and shall comprise of the following
issues:
a. Thenumberofmeetingsandtheattendanceof
eachmemberoftheAuditCommittee.
b. The opinion of the Audit Committee on the
followingissues:
i. Correctness, completeness and reliability of
theCompany’sfinancialreport.
ii. SufficiencyoftheCompany’sinternalcontrol.
iii. Compliance to the laws and regulations
regarding the Securities and Exchange Act,
requirement of the Stock Exchange of
Thailand, or regulations relating to the
Company’sbusiness.
iv. SuitabilityoftheAuditor.
v. Transactions which might cause conflict of
interest.
vi. Opinions or observations which the Audit
Committee obtains from performing their
duties.
c. Other matters, which are entrusted by the
shareholders and investors under the scope of
dutiesandresponsibilities,grantedbytheBoard
ofDirectors.
8) Report the Audit Committee’s performance to the
BoardofDirectorseveryquarter.
9) Any other matters assigned by the Board of
DirectorsandapprovedbytheAuditCommittee.
C. Powers and Duties of the Nomination and
Remuneration Committee
ThescopeofdutiesandauthoritiesoftheNomination
andRemunerationCommitteeareasfollows:
1. Determinethepolicy,criteriaandproceduresofthe
nomination of the Directors of the Company and
ExecutivesfromtheleveloftheDivisionManager.
2. Select and nominate the persons with suitable
qualifications for the Board of Directors, in the
positionsofthefollowing:
(1)Directors;
(2)Executives from the level of the Division
Manager.
3. SupervisetheBoardofDirectorstoensurethatthe
sizeandelementsaresuitable for theorganization,
includingtheappropriateadjustmentsinresponseto
the changing environment. The Board of Directors
shallconsistofmemberswithsufficientknowledge,
competenceandexperienceinseveralfields.
4. Determine the policy and criteria of payment of
remuneration and other benefits in general and
those given to the Directors and Executives from
theleveloftheDivisionmanagertobeproposedto
theBoardofDirectorsforapproval.
5. Determinetheguidelinetoevaluatetheworksofthe
BoardofDirectorsandtheExecutivesfromthelevel
of the Divis ion Manager . This includes the
considerat ion of the annual remunerat ion
adjustment , by taking into account the
responsibilities and the risks involved, while still
paying attention to the long term improvement of
theshareholder’sequity.
6. Call the documents from related par ties for
considerationandprovisionofopinion.
7.ReportitsperformancetotheBoardofDirectorsat
leastonceayear.
8.PerformtasksdesignatedbytheBoardofDirectors.
9. Consideranyotherrelatedmatters.
List of Directors ThetablebelowshowstheoverviewofDirectorsofthe
CompanyandpositionsintheAuditCommitteeandthe
Nomination and Remuneration Committee as of
December31st,2012.
Annual Report 2012
��
Qual i f icat ion and Appointment of Independent Director ThemainpurposeofIndependentdirectoristoprotect
the interests of shareholders in a fair and impartial
mannerinordertoachievethemaximumbenefittothe
shareholders. This is done by exercising independent
decisionwithoutanyconflictofinterest.
Each independent director shall comply with the
followingrequirements:
1. Shallholdsharesnotexceedingonepercentofthe
total number of shares with voting rights of the
Company and any affiliated company, including
sharesheldbyrelatedpersonsofsuchindependent
director.
2. Shall not be in the position of executive director,
employee, staff, advisor who receives salary from
the Company and any af fil iated company, or
managing director of the Company, subsidiary
company,affiliatedcompanyor juristicpersonwith
conflictofinterest.
3. Shallnotbearelatedpersonorcloserelativeofthe
Company’sexecutiveormajorshareholders.
4. Shall not be an auditor of the Company and any
affiliatedcompany.
5. Shallnotbeaproviderofanyprofessionalservices,
includingthoseaslegaladvisororfinancialadvisor
whoreceivesservicefeesexceedingBaht2million
per year from the Company and any affiliated
company.
6. ShallnothavethebusinesswiththeCompanywith
thevalueexceedingBaht20millionorhigher than
3% of net tangible assets (NTA) (whichever is
lower)within2yearsbeforetheappointment.
7. Shal l not be a director appointed as a
representativeof theCompany’sdirectorsormajor
shareholders.
8. Shall be capable to perform duties, give opinions,
and repor t the results of work per formance
according to the duties entrusted by the Board
independently from the control of management or
majorshareholdersoftheCompany.
InordertobeconformedtotheCorporateGovernance
Policy, the Company’s Independent Directors are
recruited by the Nomination and Remuneration
Committee. The Nomination and Remunerat ion
Committeesetsuppoliciesandcriteriaforrecruitment,
whichhavebeenapprovedbytheCompany’sBoardof
Directors.
Name Board of Directors Audit Committee Nomination and Remuneration Committee
Mr.YeapSweeChuan Chairman& ExecutiveDirector Mrs.TeoLeeNgo ExecutiveDirector Mr.HirotoMurai Director Mr.YoshiakiIchimura* IndependentDirector Mr.KennethNg IndependentDirector Mr.JohnParker IndependentDirector Mr.PipatR.Punya IndependentDirector Chairman Chairman Mrs.PorntipaPraditsuktavorn IndependentDirector Member** Member Mr.SupasakChirasavinuprapand IndependentDirector Member Member
* Mr.YoshiakiIchimura’sappointmentiseffectiveasfromFebruary29th,2012.
**Mrs.PorntipaPraditsuktavornisthememberoftheAuditCommitteewithbackgroundinaccountingandfinance.
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For the fiscal year 2012, all Independent Directors of
the Company do not have any related businesses or
services with the Companywith the valuemore than
the amount stated in the Security and Exchange
CommissionAnnouncementTorJor28/2551.
The Board Meetings Therewereintotal12meetingsintheyear,ofwhich6
meetingsfortheBoardofDirectors,4meetingsforthe
Audit Committee, and 2 meetings for the Nomination
andRemunerationCommittee.Theattendanceofeach
directorisshowninthetablebelow.
Authorized Directors AuthorizedDirectors
Directorswhoareauthorized tosignonbehalfof the
CompanyareMr.YeapSweeChuanandMrs.TeoLee
Ngo,jointlysignwiththeCompany’ssealaffixed.
CompanySecretary
Ms. Phanthip Sintawanarong is appointed as the
CompanySecretaryasfromSeptember2012.
Appointment and Dismissal of Directors According to theCompanyRegistration, theBoard of
Directorsshallbecomprisedofatleast5directors,of
whichmorethanhalfoftotalnumberofdirectorsmust
reside in Thailand. The Nomination and Remuneration
Committee is responsible to nominate suitable
candidateforthedirectorpositionoftheCompany.The
nominated candidate approved by the Board of
DirectorsisthenproposedtoShareholders’meetingfor
approvalasdescribedbelow:
a) Eachshareholderhasoneshareequaltoonevote.b) Each shareholder can vote for some or all of thedirectorsbutcannotsplitsharevoting.
c) Incasetwodirectorshavethesamenumberofvotes,theChairmanofthemeetinghasthecastingvote.
AttheAnnualGeneralMeeting(AGM),aboutone-thirdof the directors must retire. In case the number ofdirectorsisnotamultipleofthree,thenearestnumberbut not exceeding one-third is applied. The retireddirectorsareallowedtobere-electedforanotherterm.
Other than the completion of terms, a Director mayleavethepositionduetothefollowingreasons:
1) Death2) Resignation (effective from the date when theCompanyreceivestheletterofresignation)
3) LackofqualificationsaccordingtotheArticle68ofthePublicCompanyLimitedAct1992
4) Decision of the shareholders’meeting to terminateaccording to theArticle76of thePublicCompanyLimitedAct1992
5) Courtorder
Name Board of Directors Audit Committee Nomination & Meeting Meeting Compensation Committee Meeting
Mr.YeapSweeChuan 6/6 N/A N/A Mrs.TeoLeeNgo 4/6 N/A N/A Mr.HirotoMurai 0/6 N/A N/A Mr.YoshiakiIchimura 4/6* N/A N/A Mr.KennethNg 5/6 N/A N/A Mr.JohnParker 3/6 N/A N/A Mr.PipatR.Punya 6/6 4/4 2/2 Mrs.PorntipaPraditsuktavorn 6/6 4/4 2/2 Mr.SupasakChirasavinuprapand 6/6 4/4 2/2
*TheappointmentofMr.YoshiakiIchimuraiseffectiveasfromFebruary29th,2012.
Annual Report 2012
��
Remuneration of Directors for Fiscal Year 2012 Name Board of Directors Audit Nomination & Bonus Total Committee Remuneration Committee Annual Attendance Attendance Attendance Allowance Fee Fee Fee
Mr.YeapSweeChuan - - - - - - Mrs.TeoLeeNgo - - - - - - Mr.HirotoMurai - - - - - - Mr.YoshiakiIchimura - - - - - - Mr.KennethNg 250,000 50,000 - - - 300,000 Mr.JohnParker 250,000 30,000 - - - 280,000 Mr.PipatR.Punya 275,000 60,000 - 10,000 - 345,000 Mrs.PorntipaPraditsuktavorn 250,000 60,000 - 10,000 - 320,000 Mr.SupasakChirasavinuprapand 250,000 60,000 - 10,000 - 320,000
Remuneration of Executives 2012 2011
No. of Amount No. of Amount executives executives
Salary Baht 29.42Million Baht 21.37Million
Bonus Baht 3.24Million Baht 3.75Million
ProvidentFund Baht 0.94Million Baht 0.97Million
Total 25 Baht 33.60Million 19 Baht 26.09Million
Employee Joint Investment Program Aspartofanincentiveschemetobuildmotivationand
createsenseofownershipforemployees,theCompany
starts the Employee Joint Investment Program (EJIP)
whichisaprogramwhereemployeeandtheCompany
joinon voluntarilybasis to regularly investonly in the
Company’sstock.Theprogramperiod is2yearsfrom
October1st, 2012 toSeptember30th,2014.Under this
program, the Company deducts up to 10% of salary
fromthepayrollofparticipatedemployeeseachmonth,
andtheCompanymakescontributionatarateof50%
ofcontributionsmadebytheprogramparticipantseach
month.Asecuritiescompany thathasbeenappointed
bytheCompanytheninvestsbothemployee’sandthe
Company’s contributions in shares of the Company
throughtheStockExchangeofThailandinaccordance
with the specified conditions and period. Shares
acquired under this program are prohibited to sell in
the firstyear.Theprogramparticipantsareallowedto
sellupto50%oftheirsharesafter1year,andcansell
remainingsharesafterthecompletionoftheprogram.
This program was approved by the Office of the
SecuritiesandExchangeCommissiononOctober17th,
2012.AsofDecember31st,2012,therewere42eligible
employeesparticipatedinthisprogram.
Dividend Policy The Company and its affiliates have a policy to pay
dividend of not less than 10% of the net profit after
tax.Thedecisionfordividendpaymentissubjectedto
thefutureinvestmentplanandothernecessitiesasthe
Companydeemsappropriate.
(Unit:BAHT)
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Board of Directors
Audit Committee
Nomination and Remuneration Committee
Persident & CEO Mr. Yeap Swee Chuan
DirectorManufacturing
Mr. Veera Buanwongse
ExecutiveDirectorFinance&AdminMrs. Teo Lee Ngo
AssistantGeneralManagerFinance&Accounting
Mrs. Kannika Kartiwithcha
GeneralManagerMarketing&Sales
Mr. Roengsuk Viphoonitisilkul
AssistantGeneralManagerManufacturing
Mr. Sattha Peth-in
GeneralManagerProject
Mr. Kawee Wasaruchareekul
Organization Chart of AAPICO Hitech PLC.
Organization and Management
Management of Subsidiary Companies
Persident & CEO Mr. Yeap Swee Chuan
AAPICOForgingCOO
Ms. Yeap Xin Rhu
AAPICOPlasticsCOO
Mr. Gohara Yoshiyuki
KunshanChaitai-XinchengCOO
Mr. Gao Xue Guang
AAPICOShanghaiCOO
Mr. Gao Xue Guang
NewEraSalesGeneralManagerMs. Koh Tang Kim
AAPICOAmataCOO
Mr. Yong Prathuangsukh
AAPICOStructuralProductsCOO
Mr. Yong Prathuangsukh
AAPICOHitechToolingDirector
Mr. John Raymond Drew
AAPICOHitechPartsDirector
Mr. Veera Buanwongse
AAPICOITSGeneralManagerMr. Yugio Duad
TenagaSetiaResourcesGeneralManagerMs. Koh Tang Kim
AMactionGeneralManagerMr. Yugio Duad
AbleMotorsExecutiveDirectorMs. Yeap Xin Yi
NewEraSalesExecutiveDirectorMs. Yeap Xin Yi
Annual Report 2012
��
Mr. Yeap Swee Chuan Age 65
• President&CEO
• AuthorizedDirector
Education
• BachelorofTechnology(Industrialmanagement), MasseyUniversity,NewZealand
Training Courses
• DirectorCertificationProgram(DCP)
AH Shareholding12.54%
Work Experience in the past 5 years 2010-present Director, BoardofTrade2010-present ViceChairman, PeaceNetworkofThailand2005-present Chairman, MalaysianThaiChamberofCommerce2000-present Director,AuditCommittee Goodyear(Thailand)PLC.1996-present PresidentandCEO, AAPICOHitechPLC.
Mr. Pipat R. Punya Age 63
• IndependentDirector
• ChairmanofAuditCommittee
• ChairmanofNominationandRemunerationCommittee
Education
• BachelorofLaws,ThammasatUniversity
• MasterofPublicandPrivateManagement,NIDA
Training Courses
• DirectorAccreditationProgram(DAP)
AH Shareholding-
Work Experience in the past 5 years 2004-present Director, VillaComfortaCo.,Ltd.1996-present IndependentDirector,ChairmanofAudit CommitteeandChairmanofNominationand RemunerationCommittee, AAPICOHitechPLC.1988-present Director, GoThailandTourCo.,Ltd.1983-present Firstclasslawyer, NitipatLawFirmCo.,Ltd.
Board of Directors’ Information
Mrs. Teo Lee Ngo Age 62
• ExecutiveDirector
• AuthorizedDirector
Education
• BachelorofCommerce(IndustrialandBusiness Management),NanyangUniversity,Singapore
Training Courses-
AH Shareholding9.86%
Work Experience in the past 5 years 1996-present ExecutiveDirector, AAPICOHitechPLC.1996-present Director, AbleSanohIndustries(1996)Co.,Ltd.
Mr. Yoshiaki Ichimura Age 58
• IndependentDirector
Eucation
• YokohamaNationalUniversity
Training Courses-
AH Shareholding-
Work Experience in the past 5 years 2012-present President HyundaiMotor(Thailand)Co.,Ltd.2009-2011 SeniorVicePresident,MachineryDivision SeniorGeneralManager,AutomotiveUnit SojitzCorporation2007-2008 GeneralManagerofAutomotiveDept.3, AutomotiveUnit,Machineryand AerospaceDivision SojitzCorporation
Mr. Hiroto Murai Age 46
• Director
Education
• BachelorofEngineering(DivisionofMaterialPhysics), OsakaUniversity,Japan
Training Courses-
AH Shareholding-
Work Experience in the past 5 years 2005-present Director, AAPICOHitechPLC.2005-presentDirector, SAITCo.,Ltd.(SojitzAutomotiveInvestment)
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Mr. Supasak Chirasavinuprapand Age 49
• IndependentDirector
• MemberofAuditCommittee
• MemberofNominationandRemunerationCommittee
Education
• LL.B.FacultyofLaw,ThammasatUniversity
• Barrister-at-Law,TheInstituteofLegalEducation, Thailand
• M.S.inEconomics-PolicyandPlanning,Northeastern University,Boston,Massachusetts
• M.C.L,CaliforniaWesternSchoolofLaw,SanDiego, California
• LL.M.,ArizonaStateUniversity,Tempe,Arizona
Training Courses2004 DirectorAccreditationProgram(DAP) ThaiInstituteofDirectorsAssociation(IDO)
AH Shareholding-
Work Experience in the past 5 years 2004-present Partner, RoyalAdvocatesInternationalLimited2002-present IndependentDirector,MemberofAudit CommitteeandMemberofNominationand RemunerationCommittee, AAPICOHitechPLC.
Mrs. Porntipa Praditsuktavorn Age 59
• IndependentDirector
• MemberofAuditCommittee
• MemberofNominationandRemunerationCommittee
Education
• MasterinAccounting,MajorCostAccounting, ChulalongkornUniversity
Training Courses
• DirectorAccreditationProgram(DAP)
AH Shareholding-
Work Experience in the past 5 years 2010-present ManagingDirector, PraditsukCo.,Ltd.2002-present IndependentDirector,MemberofAudit CommitteeandMemberofNominationand RemunerationCommittee, AAPICOHitechPLC.1999-2009 ExecutiveOfficer, PanasonicElectricWorks(Thailand)Co.,Ltd.
Mr. John Parker Age 65
• IndependentDirectorEducation
• B.Eng.(ManufacturingEngineer),PortElizabeth CollegeofEducation
• CostandManagementAccounting,UniversityofSouth Africa
Training Courses-
AH Shareholding-
Work Experience in the past 5 years 2011-present IndependentDirector, AAPICOHitechPLC.2006-2010 ExecutiveVicePresident-AsiaPacificand Africa,FordMotorCompany2003-2006 ViceChairmanandCOO, MazdaMotorCorporation VicePresident, FordMotorCompany
Mr. Kenneth Ng Age 44
IndependentDirector
Education
• BachelorofSciences(Hons),Biotechnology
• GraduatedUppersecond,King’sCollegeLondon University,UnitedKingdom
• QualifiedCharteredAccountant(InstituteofEngland& Wales)
Training Courses-
AH Shareholding-
Work Experience in the past 5 years 2008-present IndependentDirector, AAPICOHitechPLC.2007-present Director, BunCompanyCo.,Ltd.2005-presentDirector, KNKNCo.,Ltd.2005-presentDirector, NTAsset(Thailand)Co.,Ltd.
Annual Report 2012
��Employees
AttheendofDecember31st,2012,AAPICOHitechanditssubsidiariesemployedintotal4,060employees.The
breakdownofemployeesbyproducttypeisshowninthetablebelow.
Product Type Number of employees as at December 31st, 2012
Jigs 55
Dies 58
OEMAutoParts 766
ChassisFrames 894
Forging&MachiningAutoParts 1,345
PlasticAutoParts 564
CarDealership 248
CarNavigation 26
Others 104
Total 4,060
Oftotalheadcounts,838employeeswereemployedinMalaysiaandChina,whichisaccountedforapproximately
21% of total headcounts. For operations in Thailand, AAPICO Hitech has recruited a number of competent
expatriateswithrelevantskillstoenhancethedevelopmentoftheCompanyasfollows:
Nationality Number of employees as at December 31st, 2012
Japanese 9
Malaysian 4
Indian 2
German 2
Chinese 1
Filipino 1
English 1
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AtAAPICOHitech,webelievethatthegoodcorporate
governance is an important key factor in order to
increase the Company’s value for shareholders in the
long run. TheCompany’s corporate governancepolicy
is adhered to the guideline for the listed companies
andconformedtogoodgovernancepracticesunderthe
guidance of the Stock Exchange of Thailand. The
Company has carried out its operations according to
thecorporategovernancepolicyasfollows:
Section 1 Rights of Shareholders
The Company ensures that shareholders are given
opportunities toexercise their rightsandprohibitsany
actionsorpracticesthatlimittherightsofshareholders.
1. TheCompany held the AnnualGeneralMeeting of
Shareholders for the year 2012 on Friday 27 April
2012at14:30Hrs.atTheRiver,ChatriumRiverside
Hotel, 28 Charoenkrung Soi 70, Bangkok, for the
convenienceofshareholders.
2. The Company issued the invitation to the Annual
GeneralMeetingwithsupportingdocumentsinboth
ThaiandEnglish,andprovidedcompleteinformation
and instruction of the Annual General Meeting, to
shareholders in advance prior to themeeting. The
Companyhasalsopublishedthisinformationonits
websiteunder the“Investor Information”sectionas
well as announcement via the SET’s electronic
media.
3. The Company encouraged shareholders to
par ticipate in the Annual General Meeting of
Shareholdersandexercisetheirvotingrightsatthe
meeting.Shareholderswereallowedtoexpresstheir
opinions,raisequestionsrelatingtotheagendaand
the issues presented. Any actions that could be
considered to violate the shareholder’s right were
prohibited.
Section 2 Equitable Treatment of Shareholders
The Company shall treat each and every shareholder
fairly and equally regardless of gender, age, race,
nationality, religion, beliefs, political opinions, or
disabilities.
1. Every shareholder had the r ight to receive
information and documents either in Thai or in
English.
2. Shareholderswereallowedtocastaproxyvoteand
appoint the proxy to attend the meeting on their
behalf. TheCompanyhas also given theoption to
the shareholders of appointing 2 independent
directorsastheirproxy.
3. TheCompany has notified the shareholders of the
documents or other evidence needed to identify
them in order toparticipate at theAnnualGeneral
Meeting and provided clear guidance in the
invitationletter.
4. The Company did not add any other items in the
Meeting agenda that were not stated in the
invitationletter.
5. The Board of Directors prepared the minutes of
Shareholders’ Meetings and distributed them to
shareholders via the Company’s website within 14
daysafterthemeetingdate.
Section 3 Roles of Stakeholders
TheCompanyrecognizestherightsof itsstakeholders
and thateachpartyhasdifferentneedsand interests.
Therefore, the Company has established policies to
meettheirrequirements.
The Company has classified stakeholders into the
following group:majority shareholders and institutional
investors,minority shareholders, creditors anddebtors,
customers,tradingpartners,employees,thecommunity
andsocietyasawhole.
Corporate Governance Report
Annual Report 2012
��
1. Majority Shareholders, Institutional Investors and
Minority Shareholders
TheCompanyshallcontinueitsbusinessoperations
with the highest level of transparency, maintain
systematic and reliable accounts on behalf of all
shareholders, and emphasize on the Company’s
longtermgrowthandappropriateremuneration.
2. Creditors and Debtors
The Company shall comply with all terms and
conditions in agreement with its creditors and
debtors, andconsistently reporton theCompany’s
financial situation. The Company shall notify the
creditors and debtors in advance if terms and
conditions could not be applied, and both parties
shallcometogethertoresolvethesituation.
3. Customers
The Company has f i rm commitment to i ts
customerstocontinuouslydevelopitsproductsand
services. The Company shal l abide by the
requirements agreed upon between the Company
anditscustomers.
4. Trading Partners
The Company considers equality and honesty as
vir tues among its core business values. The
Company shall strictly comply with rules and
regulations as well as operate in ethical business
operation.
5. Employees
TheCompanyconsidersthewelfareofitspersonnel
at all levels, in which their employment contracts
shall be fair, remuneration shall be reasonable and
appropriate to the employees based on their
capability andbeable tomaintain theirmotivation,
as wel l as tra in ings and developments are
sufficiently provided to employees to improve and
enhance their skills and performances. Moreover,
theCompanyshallmaintainhighstandardofsafety
anddisciplinedworkenvironment.
6. Community
The Company has continuously been providing
support and contribution to the community and
society as a whole. The Company strongly
encourages i ts subsidiar ies and associate
companiestoprotecttheenvironmentandmaintain
safety in its operations. Also, the Company
promotesCorporateSocialResponsibilityClubs for
its personnel, so that everyone recognizes the
importanceoftheircommunity.
Section 4 Information Disclosure and Transparency
TheCompanyensuresthatdisclosureofbothfinancial
and non-financial information is correct, adequate,
reliable, and current to the stakeholders in order to
support their decision-making and to show the true
statusof theCompany’sperformance. TheCompany
has strongly placed an emphasis on monitoring
transactions done by the Company and to be in line
withtherelevantlawsandregulationsonDisclosureof
InformationandTransparency.
1. The Company disclosed information including
quarterly financial statements, Form 56-1, and
Annual Report through the Stock Exchange of
Thailand(SET)website,aswellasmadeitavailable
on the Company’s website according to the
regulationsontimelybasis.
2. TheCompany compiled informationwith care in a
clear, accurate and transparent manner, and
conveyed the message in a simple and concise
language. The information is regularly updated in
orderforthestakeholderstoreceivetheinformation
inatimelymanner.
3. TheBoardofDirectorsensuredthattheCompany’s
financial statements were prepared fairly and
accurately. The audited financial repor t was
announcedtothepublicontimelybasis.Inaddition,
the Board had also repor ted the auditor ’s
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remunerationandpresented to theshareholdersat
theShareholders’Meetingfortheirapproval.
4. IncaseofanychangesintheCompany’ssecurities
holdingoftheBoardofDirectors,theCompanyhas
disclosedsuch information ina timelymannerand
complied with the regulations established by the
SecuritiesandExchangeCommission.
5. For communication to shareholders and investors,
the Company participated in the Opportunity Day
organized by the Stock Exchange of Thailand on
quarterlybasis.
Section 5 Roles and Responsibilities of the Board
TheCompany recognizes the importanceof rolesand
responsibilities of the Board of Directors in order to
help provide guidance and direction to the Company
and itsmanagement team. TheBoard of Directors of
theCompanycomprisesofdirectorswhoarequalified
in termsof skills, experience and expertisewhich are
benef ic ia l to the Company. As appointed by
shareholders, the Board of Directors selects
managementtooperatetheCompany’sbusinesses.
The Board of Directors recognizes their duties and
responsibi l i t ies in managing the Company with
transparencyandwiththeconsiderationofattainingthe
maximum benef i t for the Company and i ts
shareholders.Thereisaclearseparationofdutiesand
responsibi l i t ies between the Board and the
ManagementtoensurethattheCompanyoperatesina
lawfulandethicalmanner.
1. Composition, Qualification and Appointment of
the Board
• The current structure of the Board sets anappropr iate number of members and a
composition where the number of independent
directors isat leastone-thirdof theboardsize,
andisnotlessthanthreedirectors.
• ThelistofDirectorsincludingtheirqualifications,background, experience, their attendance to the
Boardmeeting, and their remuneration together
with the policy in determining the remuneration
are disclosed in the Annual Information
Disclosure form (Form 56-1) and the Annual
Report(Form56-2).
• Each Director is qualified under the PublicCompany law and has no record of suspicion
concerning any behavior against the fiduciary
duty for thePublic LimitedCompanyunder the
laws or regulations and notifications announced
bytheSecuritiesandExchangeCommission.
• TheBoardofDirectorsclearlyspecifiesthetermofserviceofthedirectors.
• Each member of the Board of Directors shallhold his positions in the boards of registered
companies for not more than 5 companies
excluding the Company’s subsidiaries. The
holdingofpositioninotherboardsformorethan
5companiesmustbeconsideredandapproved
bytheCompany’sBoardofDirectors.
• The Board of Directors shall receive adequateand complete information in order to make
effective decision concerning the Company’s
operations.
2. Roles and Responsibilities of the Board
The Board of Directors shall act professionally to
leadtheCompany intherightdirection inorderto
protect the benefit of the shareholders. The roles
andresponsibilitiesoftheBoardofDirectorsinclude
butarenotlimitedtothefollowing:
• The Board of Directors reviews and approveskey business matters such as the vision and
mission of the Company, strategies, financial
targets, risks, major plans of action and the
budget.
Annual Report 2012
��
• The Board of Directors closely monitors thecompliance of Management to the Company’s
policies.
• TheBoardofDirectorssetsaclearguidelineonthe approval of transactions with conflict of
interests, including related transactions and
connected transactions. For example, persons
withinterestinthetransactioncannotparticipate
inthevotingordecisionmakingprocessofthat
issue.
• TheBoardofDirectorsensuresthattheinternalcontrol system is in place, including financial,
compliance, and policy control, by assigning a
persontoindependentlyauditandreportonthe
system.
• The Board of Directors establishes a riskmanagementpolicy coveringall activitiesof the
Company,aswellasassignsthemanagementto
implement thepolicy, report back to theBoard
on regular basis , and seek business
opportunitiesthatmayarisefromtheserisks.
• The Board of Directors schedules the boardmeeting for the year in advance and notifies
directorsofthescheduletoalloweachmember
to manage time to attend the meetings. In
addition,meetingdocumentsandnotificationare
sent to directors at least 7 days prior to the
BoardofDirectors’meeting.
• The Board of Directors defines policies andmethods to facilitate training for new directors
abouttherolesofdirectorsaswellasthenature
ofbusinessesandoperationsoftheCompany.
• The Board of Directors encourages continuoustraining for all parties related to corporate
governanceespeciallythose intopmanagement
positionoftheCompany.
• The Board of Directors shall provide adequatecommunication channels for shareholders. The
disclosure of information shall be monitored to
ensure high standards of accuracy, clarity,
transparencyandreliability.
3. Independence of the Board of Directors
To ensure the independence of the Board of
Directors,thenumberofindependentdirectorsshall
beaccountedforone-thirdofitsnumberornotless
than3people.
• Independent directors must have access tofinancial information and details of business
operationsinordertohaveadequateinformation
toindependentlyexpresstheiropiniontoprotect
theshareholder’sinterest.
• The Company’s definit ion of independentdirectors meets the minimum qualifications as
specified by the Securities and Exchange
Commission.
• The independent directors shall work equitablyon behalf of the shareholders to prevent any
possibleconflictofinterestsintheCompany.
4. Board of Audit Committee
TheBoardofAuditCommitteeshallcompriseofa
minimum of 3 directorswith at least onemember
havingfinancialandaccountingexpertise.TheAudit
Committee members must have suf f ic ient
independent qualifications in accordance with the
Securities and Exchange Commission. The Audit
Committee shall be responsible for reviewing and
monitoring the Company’s operations, financial
reporting and internal control systems. Its duties
also include selecting the Company’s auditor,
reviewing and approving transactions which may
cause confl ict of interests including related
transactions and connected transactions and
overseeingtheriskmanagementsystem.
5. Board of Nomination and Remuneration Committee.
The Board of Nomination and Remuneration
Committeeshallcompriseofatleast3independent
directors.TheresponsibilitiesoftheNominationand
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RemunerationCommitteeincludebutarenotlimited
tothefollowing:
• Review and appoint the director andmanagementpositionsoftheCompanybyusing
transparent selection criteria to ensure that the
candidatesarequalifiedfortheposition.
• Reviewandapprovethesalaryadjustmentsandthebonusprovisionsforemployees.
• Review and approve the appointment and theremunerationoftheBoardofDirectors.
• Review and approve the appointment andremunerationoftheAuditor.
6. Remuneration of the Directors and President
The Remuneration Committee is responsible to
provide advices to the Board concerning the
remuneration of directors and the President. The
proposalofremunerationshallbereasonablybased
on the industry average. The structure of
remunerationshallbeclear,transparentandeasyto
comprehend.
TheNominationandRemunerationofdirectorsand
thePresidentshallbeconsideredandapprovedby
the Board of Directors and subsequently the
ShareholdersattheShareholders’meeting.
Use of Inside Information The Company has the policy that its directors,
executives and personnel shal l keep corporate
information strictly confidential, particularly internal
informationnotyetdisclosedtopublicthatmayaffect
the business of the Company or its stock price. The
Company has strongly advices its executives and
employees, includingthoseinsubsidiarycompanies,of
thefollowingguidelines:
1. That the use of inside information for personal or
others’gainisstrictlyprohibited.
2. That the changes in securities holding of its
directors and executives, resulting from acquisition,
disposit ion, transfer or being transferred for
securities, must be repor ted to the Office of
Securities and Exchange Commission using the
specified form (Form 59-2 or Form 246-2) in a
timely manner and within 3 working days after
transactiondate.
3. That theCompany’s securities trading of directors,
executivesandemployeeswhohaveacquiredinside
information shall be suspended for a period of 30
daysprior to theannouncementof theCompany’s
results of operations to the Stock Exchange of
Thailand.
Anydirectors,executives,oremployeeswhoviolatethe
Company’spolicyresultinginderogationordamageto
the Company are subjected to penalty measures and
possibly legal actions taken by coordinated, relevant
regulatoryauthorities.
Annual Report 2012
��Internal Control
The Board of Audit and Corporate Governance
Committeehasevaluated theadequacyof the internal
control of the Company and its subsidiaries and
considers that theCompany and its subsidiaries have
an effective internal control system where the results
were in compliance with the defined procedures and
consistent with governmental statutory provisions and
the Corporate Governance policy. According to the
guidelinesoftheStockExchangeofThailand(SET),the
internal control of the Company is in place without
significant deficiencies where the details of internal
controlcouldbesummarizedasfollows:
Control Environment The Company has careful ly set up clear and
measurablebusinessobjectives,goalsandvisiontobe
a guideline for the executives and employees to
achieve the planned operating performance, where
budget planning and monthly management reviews
were put in place to fulfill its goals. The Board of
DirectorshasalsoperiodicallyreviewedtheCompany’s
operations to ensure conformity with the business
objectives taking into account the fair treatment to
stakeholdersforlong-termbenefitoftheCompany.
TheBoard ofDirectors has established theCorporate
Governancepolicyand theCodeofConductwith the
intention to enable the Company to conduct its
business ef f ic ient ly and have good corporate
governance and excellent management. The Board of
Directorshaspromotedthispolicyasaguidelinewhere
directors,managementandstaffsshalladherewiththe
purpose of benefiting shareholders’ interest and
maintainingbusinessethicsandtransparency.
The Company sees the importance of developing its
manufacturing processes for standard products where
it has achieved the ISO/TS 16949 and ISO 14001
certificationand responsibleunitshavebeenassigned
to under take the inspection and monitoring for
compliance with requirements. In addit ion, the
Companyalsoemploysofficialbodytoperformannual
audittoensurethatrelateddepartmentsareconformed
totheoperatingstandards.
Risk Management TheCompany’smanagement has, on a regular basis,
monitored the potential risk factors and has tried its
best to control those risk factors by implementing
varioustoolsasdiscussedintheRiskFactorssection.
Control Activity TheCompanyhasemphasizedtheimplementationofa
strongcontrolactivityasfollows:
• TheCompanyhasadequatecontrol for themisuseof the Company’s assets for the benefi t of
executivesanddirectors.
• Major duties have been segregated to preventpotential fraud. This segregation of duties includes
segregationofdutybetweenauthorization,recording
andcustodyofassets.
Information System and Communication The Company communicates to its employees the
information about the Company’s policies, regulations
and instructions via intranet and dif ferent levels
of meetings in order to ensure effective internal
communication. For the information technology and
data communication, the Company has implemented
andimprovedtheOracleEnterpriseResourcesPlanning
(ERP)systemthroughouttheorganization.
For communicat ion with external par t ies, the
Company’s information is disclosed via the Stock
ExchangeofThailand(SET)’sCommunityPortalsystem
and the Company website at www.aapico.com. The
Company also allows investors (both individual and
institutional investors),analysts,and interestedexternal
partiestoreceiveinformationandaskquestionsinthe
Oppor tunity Days held quar ter ly by the Stock
ExchangeofThailandorviaemailcontactasspecified
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in the Company’s website. In addition, the Company
arrangedatleastonceayearfortheshareholdersand
investors to visit the Company’s factories for better
understanding of the Company’s manufacturing
process.
The Audit Committee, auditors and concerned parties
together take part in completing the Company’s
financial statements every quarter to ensure that the
generally accepted accounting standards have been
complied with. In addition, supporting documents for
accounting records and accounts are fully kept for
transparencyandtobeusedforoperationalobjectives.
The Company’s Board of Directors receives invitation
letters,meeting agenda, and supportingdocuments in
advance of the meet ing. Discussions and
recommendations including resolutions of the Board
are recorded in the minutes of meetings for future
reference.
Monitoring and Assessment In2012,theresultsofperformancewerereviewedand
monitored in the Board of Directors’ meeting as to
whether it achieved the goals set. The Company’s
managementisrequiredtofollowupandsupervisethe
implementat ions based on strategic plans and
projectionsincludedintheannualbusinessplan.
In addition, TheBoard of Directors entrusts the Audit
Committee to review with the management the risk
managementpolicyandpracticecompliancewithsuch
policy.TheAuditCommittee’sReportisattachedinthe
AuditCommitteesection.
Annual Report 2012
��Related Transactions
Disclosure of Related Transactions
During the year 2012, the Company has conducted
transactions with its subsidiaries, associates, and
related companies or individuals. These transactions
arose in the ordinary course of business and were
concludedoncommercialtermsandconditionsagreed
uponbetweentheCompanyandthoserelatedparties.
These transactions are disclosed in Note 7 of the
Notes to the Financial Statements for the year ended
December31st,2012.
Necessity and Justification for Related Transactions
The Audit Committee has considered the related
transactions of the Company with the subsidiary
companies, joint venture companies and associated
companies. Major transactions in the year 2012 were
the sale and purchase of goods and services among
theAAPICOGroup,ofwhichweretheOEMautoparts,
jigsanddies,theprovisionandthereceiptoffinancial
support, receivable interests, management fees, and
rental fees. The trading of products and services
represents the normal business activities of the
Company. The rental fees were based on the rental
rates of other buildings in the same area. These
transactions are deemed to be necessary for the
Company’soperationswithprimaryconsiderationofthe
highestbenefittotheCompany.
As the Company has a centralized finance policy to
reduce the interestburden,mostofexternal loansare
borrowedbyAAPICOHitechPLC,andthenreleasedto
subsidiary companies. The loan among related parties
wasdoneundernecessaryandurgentconditions.The
calculationof interestof internal loan isbasedon the
averageborrowingcostofAAPICOHitechPLC.
Policies or Trends Relating to Future Related Transactions
TheCompanywillcontinuewiththepolicytohavethe
sales andpurchaseprice of products and services to
related parties comparable to the market price in
undertaking transactions with related parties in the
future. These transactions will also be considered by
the Board of Directors in compliance with the
regulations, announcements or orders of the Stock
ExchangeofThailandandtheSecuritiesandExchange
Commission. Furthermore, the Company will comply
withaccountingstandardsconcerningthedisclosureof
information of connected transactions as specified by
the Association of Thai Accountants and Certified
Auditors.
Incaseofrelatedtransactionswithpotentialconflictof
interest, or vested interests, or possible future conflict
of interest, the Company wil l assign the Audit
Committeetoprovideitsopiniononthenecessityand
justificationofsuchtransactions.IftheAuditCommittee
does not possess sufficient expertise to review the
transaction, the Company will assign an independent
experttoexpressonthetransaction.Theinformationis
then provided to the Board of Directors or
Shareholderstosupportthedecisionmakingprocess.
Detailsof the related transactionsaredisclosed in the
Notes to Financial Statements, which have been
auditedbytheCompany’sauditors.
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Overview of Business in 2012
AAPICO Hitech and its subsidiaries operate in 3
countries,namelyThailand,Malaysia,andChina,where
theCompanyisprincipallyengagedinmanufactureand
distribution of automotive parts. The Company’s
operations can be divided into 3main sectors,which
are:
1. Manufactureanddistributionofdies, jigsandOEM
autoparts
2. Cardealership
3. Carnavigationandothers
ThemaincontributionofincomefortheAAPICOGroup
mainlycame from themanufactureanddistributionof
dies, jigsandOEMautoparts,whichwereaccounted
for approximately 75% of total income of the
Company, followed by income from car dealership
businessofabout25%oftotalincome.
Management Discussion and Analysis
Profit and Loss Analysis
Revenues Analysis
Total revenues of AAPICO Hitech and its subsidiaries
are consisted of two major portions, which are sales
andserviceincomefromitsmainoperations,andother
income which are mainly sales of scrap from press
partsbusiness.
Intheyear2012,theconsolidatedtotalrevenuesofthe
AAPICO Group reached a record high at Baht 16.8
billion,postingagrowthof56%oranincreaseofBaht
6billioncomparedtolastyear’srevenuesofBaht10.8
billion. The strong year-on-year growth was mainly
driven by the strong recovery and growth in the
automotive industry due to the implementation of
government policy on the tax rebate for the first-time
carbuyers.
From the country perspective, increases of revenues
mainlycamefromdomesticsalesinThailand,asshown
inthetablebelow.
Followingthedeclineofcarproductionin2011dueto
theimpactfromTsunamiinJapanandthesevereflood
crisis in Thailand in the 4th quarter of last year, the
Thailand’s automotive industry has rebounded back
withthehighestrecordofcarproductionvolumeof2.4
million units in 2012, representing about 68% growth
comparedtotheyear2011.Thiswasduetothestrong
demandinthecar industrybothdomesticandexport,
and also the favorable government policy on the tax
rebate for the first-timecarbuyer,ofwhich its impact
isexpectedtocontinueinthefirsthalfofyear2013.
Revenues by Sector
The graph below shows the breakdown of total
revenuesoftheAAPICOGroupforeachsector.
Unit: Million Baht Y2011 Y2012 Change %
Thailand 8,278 13,904 5,626 68Malaysia 1,634 1,922 288 18China 874 985 111 13 TotalRevenues 10,786 16,811 6,025 56
Dealer24.6%
Navigation0.2%
Autoparts75.2%
Total Revenues by Sector
(Unit:BillionBaht)
Y2011Y2012
Autoparts CarDealership CarNavigation& Others
7.85
12.64
2.90 4.13
0.04 0.03
Y2012
Annual Report 2012
��
Dies, Jigs and Automobile Parts Manufacturing
Total revenues of the manufacturing of dies, jigs and
OEM auto parts grew 61% or Baht 4.8 billion, from
Baht7.85billionin2011toBaht12.64billionin2012.
Theincreasesmainlycamefromthechassisframeand
presspartsbusiness,aswellasforgingandmachining
andplasticsoperations,inlinewiththeindustrygrowth.
Thebreakdownofrevenuesbybusinessesisshownin
thegraphbelow.
Car Navigation Business
Car navigation business is a small contributor to the
consolidated revenues of AAPICO Group, with total
revenues of Baht 34 million in 2012. Compared to
2011,revenuesdecreasedbyBaht4million,whichcan
be explained by changes in market behavior and
impactoffloodcrisisinthefirsthalfoftheyear.
Cost and Expense Analysis
Cost of Sales and Service
Cost of goods sold of AAPICO Hitech and its
subsidiariesaccountedforapproximately89.6%oftotal
revenues.Compared toyear2011,costsof salesand
servicesincreasedinlinewithsalesincreases,butata
slightly higher rate than an increase of revenues. A
year-on-year comparison of sales and costs of
operationsisshowninthetablebelow.
Car Dealership Business
Total revenues of the car dealership business also
posted a sales increase, bothdomestic andoverseas,
from last year’s revenues of Baht 2.9 billion to Baht
4.13 billion in 2012. More than half of the Baht 1.23
millionsalesincreasecamefromhigherdomesticsales
due to the favorable impact of the government policy
forthefirst-timecarbuyers.
For the year 2012, gross profit as a percentage of
salesandserviceincomewas6.6%ofsalescompared
to the 2011 gross profit of 7.4% of sales. The 0.8%
decline of gross margin was largely due to lower
margins in the manufacturing of auto parts, despite
highersales.Thiswaspartlycompensatedbyimproved
marginsfromcardealershipbusiness.
Unit: Million Baht Y2011 Y2012 Change %
Salesandserviceincome 10,356 16,120 5,764 56Costofsales&service (9,591) (15,058) (5,467) 57 Gross Profit 764 1,062 297 39 Gross Profit % 7.4% 6.6% -0.8% -
Unit: Million Baht Y2011 Y2012 Change %
Sellingexpenses 211 241 30 14Administrativeexpenses 869 581 (288) -33 SG&A Expenses 1,079 822 (257) -24
Total Revenues by Business
(Unit:BillionBaht)
Y2011Y2012
ChassisFrame Dies&Press Forged& Jigs Parts Plastics
2.90 2.76 3.28
0.05 0.05
4.03
2.48
5.29
2.56
Total Revenues by Business
(Unit:BillionBaht)
Y2011Y2012
Ford Mitsubishi Honda
0.69 0.94
0.58
1.27 1.63
1.92
�0
�0
Unit: Million Baht Y2011 Y2012 Change %
Financingcosts 239 289 51 21Incometaxexpenses 94 41 (53) -56 Finance and Tax 333 331 (2) -1
Overview of Profitability
(Unit:MillionBaht)
Y2011Y2012
EBITDA EBIT NetProfit
403
2,019
(59) (390) 917
1,254
Compared to 2011, the financing costs increased by
Baht 51million or 21% to Baht 289million in 2012.
Thehigherfinancingcostswereduetotheincreaseof
bank borrowings mainly to support investments and
increased production volume and higher working
capitals.
Income tax expenses decreased Baht 53 million
compared to last year, primarily due to lower tax
expenses in AAPICO Amata, which recorded about
Baht50million taxexpenses in2011.Thiswaspartly
offset by higher tax expenses in car dealership
business. Overall, the Company and its subsidiaries
also benefit from the lower rate of corporate income
tax,from30%intheyear2011to23%in2012.
Profitability Analysis
ThegraphbelowshowsanoverviewofEBITDA,EBIT,
andnetprofitattributabletoequityholders:
Earnings before Interest, Tax, Depreciation and
Amortization (EBITDA)
Adjustedfordepreciationandamortizationexpense,the
consolidated EBITDA of AAPICO Hitech and its
subsidiarieswasrecordedatBaht2.0billion,compared
tolastyear’sEBITDAofBaht403million.Comparedto
2011, a significant increase of Baht 1.6 billion or at
400%waslargelyduetothefollowing:
• Lower costs as last year’s results includedimpairmentlossesandanetlossarisingfromflood
inthe4thquarteroflastyear,
• Higher sales driven by the industry growth andgovernmentpolicyonthefirst-timecarbuyers,
• Higherprofitfromshareofinvestmentsinassociatecompanies,
• AninsurancerecoveryofBaht145millionin2012.These increases were partly offset by lower margins,
mainlyintheautopartsmanufacturingbusiness.
Net profit
Thenetprofit forequityholdersof theCompanyalso
improvedBaht1.3billion,fromanet lossofBaht390
milliontoanetprofitofBaht917million,drivenbythe
increase in earnings and lower tax expenses, partly
offset by higher financing costs. As a percentage of
total revenues, net profitmargin improved from -3.6%
in2011to5.5%oftotalrevenuesin2012.
Financial Standing Analysis
Assets
TheconsolidatedtotalassetsofAAPICOHitechandits
subsidiariesincreasedBaht2.3billion,drivenmainlyby
increases in trade and other receivables, inventories,
andinvestmentsinassociates.
Selling and Administrative Expense
Sellingandadministrativeexpensesin2012decreased
byBaht257millionor24%comparedto2011,aslast
year’sadministrativeexpensesincludedthewrite-offof
inventoriesdamagedbythefloodinthe4thquarter.
Finance and Tax Expense
Annual Report 2012
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Trade and Other Receivables
TheCompany’stradeandotherreceivablesisoneofthe
main portions of the Company’s assets, which are
accounted for 20% of total assets. In 2012, trade and
otherreceivablesincreasedmorethandouble,orbyBaht
1.6billion,comparedtolastyear,inlinewiththeincreases
of sales. The average collection period in the year 2012
slightlydecreasedfrom49daysin2011to45days.
Inventories
At the end of 2012, the Company’s inventories were
Baht 1.3 billion, an increase of Baht 390 million
compared to the end of 2011, in line with increased
sales volume.However, as a percentage of sales and
service income, inventories declined from 8.6% to
8.0%. The inventory turnover in 2012 was 26 days,
whichis8daysshorterthan34daysin2011andwas
aboutthesamelevelasin2010.
Property, Plant and Equipment
The property, plant and equipment of the Company
wereBaht6.5billion,slightly lowerthan2011byBaht
38million or 1%. During the year 2012, increases of
assets in buildings, machinery, motor vehicles and
office equipment were mainly the reclassification of
assets from assets under production/installation to
eachmentionedcategory.
Liabilities and Shareholder’s Equity
TheincreasesintotalassetsofAAPICOHitechandits
subsidiariesofBaht2.3billionwerefinancedmainlyby
increased in liabilities andpartly fromearnings of the
Company,asshowninthetablebelow.
For the year ended 2012, the Company’s total
consolidatedliabilitiesincreasedBaht1.4billionor19%
compared to last year, driven by increases in current
liabilities, largely from trade and other payables and
short-term loans,partlyoffsetby lower long-term loan
position.
The debt to shareholders’ equity ratio in 2012 was
1.08, whichwas lower than the ratio in 2011 of 1.21
andlowerthantheaverageratiooflistedcompaniesin
thesameindustryof1.37.Withimprovedearnings,the
abilityforrepaymenthasstrengthenedasshowninthe
currentratioandtimesinterestearnedratiointhetable
below.
Unit: Million Baht Y2011 Y2012 Change %
TradeandOther Receivables 1,203 2,801 1,598 133 Inventories 892 1,282 390 44 Current Assets 2,694 4,645 1,951 72 Investmentin associates 729 914 186 25 Property,Plant andEquipment 6,578 6,541 (38) -1 Non-Current 8,827 9,139 311 4 Total Assets 11,521 13,783 2,262 20
Unit: Million Baht Y2011 Y2012 Change %
Land 700 700 - 0BuildingandBuilding 1,325 1,587 261 20ImprovementsMachineandfactoryequipment 3,551 3,772 222 6Motorvehiclesandofficeequipment 74 264 190 255Assetsundercontruction* 928 217 (710) -77 Property, Plant and Equipment 6,578 6,541 (38) -1
Unit: Million Baht Y2011 Y2012 Change %
TradeandOther Payables 1,897 3,041 1,144 60 Current Liabilities 4,012 6,058 2,046 51 Non-Current Liabilities 3,404 2,796 (608) -18 Total Liabilities 7,416 8,853 1,437 19 Total Shareholders’ Equity 4,105 4,930 825 20
��
��
Comparedtoyear2011, thetime interestearnedratio
showed significant improvement and was higher than
theratioin2010of4.00,primarilyduetomuchhigher
earnings.Thenegativeratio intheyear2011wasdue
toanetlossresultedfromflooddamages.
Trade and Other Payables
The Company’s trade and other payables at end of
2012increasedby60%orBaht1.1billioncomparedto
thepositionat theendof2011,mainlydue tohigher
volume of purchases to support sales increases. The
payablesturnoverdayin2012was60days,whichwas
18daysshorterthan77daysin2011.
Bank Financing
Total bank loans for the AAPICOGroup increased by
Baht 381 million or 8%, largely due to increases of
bank loans tosupport theCompany’s investments for
postfloodevents.
Cash flows from operating activities:
In the year 2012, the Company’s operating activities
generatedcashinflowamountedtoBaht1.1billion,an
increaseofBaht431millioncomparedtocashinflowin
2011. Compared to last year, higher cash inflow was
mainly driven by increased earnings, partly offset by
higherneedsofworkingcapital.
Y2011 Y2012 %
Debt:EquityRatio 1.21 1.08 (0.12)CurrentRatio(time) 0.67 0.77 0.10TimeInterestEarned(time) (0.25) 4.34 4.58
Unit: Million Baht Y2011 Y2012 Change %
Bankoverdraftsandshort-term 938 984 46 5Currentportionoflong-termloans 841 1,687 846 101Long-termloans-netofcurrent 3,172 2,661 (511) -16 Loans from Banks 4,951 5,332 381 8
Unit: Million Baht Y2011 Y2012 Change %
CashflowsfromOperatingActivities 637 1,068 431 68CashflowsfromInvestingActivities (1,063) (1,001) 62 -6CashflowsfromFinancingActivities 334 (86) (420) -126Translationadjustments 49 (13) (63) -127 Net increase (decrease) in cash (43) (32) 11 -25
Shareholders’ Equity
As of December 31st, 2012, the total shareholders’
equityoftheCompanyincreasedbyBaht825millionor
20%toBaht4.93billion.Theincreasewasprimarilydue
toimprovementearningsoftheAAPICOGroupin2012.
In 2012, theCompanydistributed the interimdividend
payment to shareholders for the performance of the
firsthalfof2012inSeptember2012atBaht0.488per
share, which was amounted to a total of Baht 131
million.
The return on shareholders’ equity (ROE) improved
fromanegative9%to20%in2012.
Cash Flow Analysis
As of December 31st, 2012, the Company’s cash and
cashequivalentpositionwasendedatBaht207million,
aBaht32millionlowercashcomparedtotheposition
attheendof2011ofBaht239million.
The detail of cash movements by each activity are
showninthetablebelow.
Annual Report 2012
��
Cash flows from investing activities
Cashflowfrominvestingactivitieswasanetoutflowof
Baht 1 million, primarily related to acquisitions of
machineryandequipments. Theacquisitionofassets
mainly for the replacement and repair of the flooded
assets in AAPICOHitech, AAPICOHitech Tooling and
AAPICO Hitech Parts which are situated in Ayuthaya
Compared to 2011, cash was Baht 62 million lower
than last year, due to higher dividend received from
subsidiariesandassociatesandproceedsfromsalesof
assets,which fully compensated for higher cashused
foracquisitionsofmachineryandequipments.
Cash flows from financing activities
The Company’s cash flow from financing activities
decreased by Baht 420 million, from cash inflow of
Baht 334 million in 2011 to an outflow of Baht 85
millionin2012.Thelowercashinflowcomparedtolast
yearwaslargelyduetolowerborrowingfrombanks.In
2012, the Company’s cash was used to pay out
dividendintotalofBaht131million,aBaht32million
higherthandividendpaidin2011.
Major factors and influences potentially affecting future operations or financial standing
As the main focus of AAPICO Group’s operations is
mainly inthemanufactureanddistributionofdies, jigs
and OEM auto parts, the Company’s results are
inclined tomove in the same trend as the industry’s
performance. There are no other major factors that
would significantly influence the future business
operationsandfinancialstandingoftheCompany.
At AAPICO Hitech, we are committed to continuous
improvements. In the year 2013, we aim to achieve
revenue growth in line with the industry’s projection.
Activitiesandprojectsoncost reductionareexpected
to be continued in order to have lean and cost
effective manufacturing processes. With the renewed
facilities and capacities, the AAPICO Group is well
positioned to support the growing demand fromboth
domesticand internationalarena.TheCompanywould
be able to successfully handle the increased volume
and customer’s requirements, and in turn generating
theprofitablegrowth.
��
��Report of the Nomination and Remuneration Committee
TheNominationandRemunerationCommitteeconsistsofthreeindependentdirectors,namelyMr.PipatR.Punya,
Mr.SupasakChirasavinuprapand,andMrs.PorntipaPraditsuktavorn,whereMr.PipatactsastheChairmanofthe
committee.
In theyear2012, theNominationandRemunerationCommitteeheld2meetings to followupandconsider the
importantissuesdesignatedbytheBoardofDirectors,asfollows:
1. ToformulatepolicytosubmittotheBoardofDirectorsasfollows:
1.1. Policy, criteria and selection method of directors and managers by focusing on personal
qualifications,expertise,competenceandexperienceofthecandidates.
1.2. Policy and criteria of remuneration, salary adjustment and other benefits including bonus to the
DirectorsandemployeesoftheCompany.
2. To select and nominate the persons with suitable qualifications for the Board of Directors, by using
transparentselectioncriteriatoensurethatthecandidatesarequalifiedforthepositions.Thepositionsare
asfollows:
2.1. Directors
2.2. ExecutivesfromthelevelofDivisionManager
3. To supervise the Board of Directors to ensure that the size and competence are suitable for the
organization,includingtheappropriateadjustmentinresponsetothechangingenvironment.
4. ToreviewandapprovetheremunerationoftheBoardofDirectors.
5. To supervise Directors andManaging Directors to ensure that their remuneration is appropriate to their
dutiesandresponsibilitiesassignedaswellascomparabletootherlistedcompaniesinthesameindustry
withintheStockExchangeofThailand.
6. Todetermine theguideline toevaluate theworksof theBoardofDirectorsand theExecutives from the
level of theDivisionManager. This includes theconsiderationof the annual remunerationadjustment, by
takingintoaccounttheresponsibilitiesandtherisksinvolved.
7. PerformanyactdesignatedbytheBoardofDirectors.
Mr.PipatR.Punya
ChairmanoftheNominationandRemunerationCommittee
Annual Report 2012
��
TheAuditCommitteeofAAPICOHitechPublicCompanyLimitedwasappointedby theBoardofDirectorsof the
CompanytocarryoutthebusinessregulationwithinthescopeofresponsibilitiesassignedbytheBoardofDirectors.
TheAuditCommitteeconsistsof3independentdirectorsasfollows:
1.Mr.PipatR. Punya ChairmanofAuditCommittee
2.Mrs.PorntipaPraditsuktavorn MemberofAuditCommittee
3.Mr.Supasak Chirasavinuprapand MemberofAuditCommittee
Duringthefiscalyear2012endedasatDecember31st,2012,therewere4meetingsheldbytheAuditCommitteein
total,ofwhichtheattendanceofeachmemberisshowninthetablebelow.
Name Audit Committee Meeting
TotalHeld4Times
Mr.PipatR.Punya 4
Mrs.PorntipaPraditsuktavorn 4
Mr.SupasakChirasavinuprapand 4
Themeetingwasconductedtogivefairopiniononthefollowingissues.
Correctness, completeness and reliability of the Company’s financial report
The quarterly financial statements and the annual financial statements have been jointly reviewed with the
managementtoprovideanopinionwhetherthefinancialstatementispreparedfairlyandcorrectlyinaccordance
with the generally accepted accounting principle. TheCommittee also reviewswhether key information, related
party transaction or information that could possibly cause conflict of interest has been completely and reliably
disclosed.Aftertherevision,theAuditCommitteeconcludesthattheAuditCommitteehasthesameopinionwith
the auditor that the financial statement of the Company conforms to the general accounting standard, has
adequateinformationdisclosures,hastheinternalauditsystemingoodlevel,hastransparentadministration,and
doesnothaveanymaterialissueconcerningthenon-compliancewithrelatedregulations.
Sufficiency of the Company’s internal control
Based on the review of the Internal Control system of the Company, the Audit and Corporate Governance
CommitteehasevaluatedtheadequacyoftheinternalcontroloftheCompanyanditssubsidiariesandconsiders
that the Company and its subsidiaries have an effective internal control system where the results were in
compliancewiththedefinedproceduresandconsistentwithgovernmentalstatutoryprovisionsandtheCorporate
Governancepolicy.ByfollowingtheguidelinesoftheStockExchangeofThailand(SET),theinternalcontrolofthe
Companyisinplacewithoutsignificantdeficiencies.
Compliance to law and regulations regarding the Securities and Exchange Act, requirement of the Stock Exchange or regulations relating to the Company’s business
TheAuditCommitteehasreviewedtheoperationandthereportingoftheCompany.TheAuditCommitteegives
theopinionthattheCompany’soperationandreportingisincompliancewithlawandregulationsoftheSecurities
andExchangeActandtherequirementsoftheStockExchangeofThailand.
Report of the Audit Committee
��
��
Suitability of the Auditor
Afterthe investigationandconsiderationofthe independenceoftheAuditor, theAuditCommitteeproposedthe
BoardofDirectorstoappointErnst&YoungOfficeLimitedastheCompany’sauditorfollowingthepastyears,due
totheirwidelyrecognizedauditingstandardandexperience,alongwithhighlevelofindependence.Theproposal
toappointtheauditorwouldbepresentedtotheAnnualGeneralMeetingoftheShareholdersforfurtherapproval.
Transactions which might cause conflict of interest
TheAuditCommitteehasreviewedtheauditreportandprovidesopinionthatthetransactionwhichmightcause
conflictofinterestisproperlydisclosed.
Mr.PipatR.Punya
ChairmanofAuditCommittee
Annual Report 2012
��
Corporate Social Responsibility
Corporate Social Responsibility (CSR) TheAAPICOGrouphasstrongcommitmentinoperatingitsbusinesseswithfullawarenessoftheenvironmentsustainability.CorporateSocialResponsibility(CSR)isoneofourcorevalues.Despitethebigfloodcatastrophewhich had affected the company badly, yet the company still persisted in continuing its support for manyprojectswithin itsCSRprogram. It includes“QualityofLifeTraining”,aproject thatencouragesemployeestohavemoreparticipationinsocialactivities,and“QualityofLifeClub”,whichcomprisesofSacrificeclub,Healthclub, Buddhism club, and Committed saving club. All these activities place emphasis on supporting theemployeesintheirendeavortobecomegoodpersonsfortheirownfamiliesaswellastakinganactiveroleinthedevelopmentandimprovementofThaisociety.
Quality of Life Program InadditiontheCompanyencouragesitsemployeestoactivelyengageinsocialactivitiesandprogramsthrough
the“QualityofLifeClub”,whichwasestablishedin2009.The“QualityofLifeProgram”aimstoimproveboth
physical andmental health of each employee and encourages employees to become good, responsible and
generouspersons.
Educational Scholarship The AAPICO Group recognizes the significance of
education for the development of Thai society. The
company believes in the importance of giving the
equal opportunity and access to education to all
children, especially those who lack of adequate
financial support. The AAPICO Group continuously
provides education scholarships to employees from
primarytouniversitylevel:
AAPICO Group donated used beverage cartons for the “Green RoofProject”underPrincessPaFoundation,tomakerooftiles.Therooftilesareused in the housing construction designated for the victims of naturaldisasters. AAPICO Group actively participated in the
blood donations under The Thai Red CrossSocietyaswellasofthoseorganizedbylocalhospitals.
��
��
AAPICOGroup donated unused calendars to theBangkokSchool for the Blinds, which will use them to createeducationalmaterialsforchildrenwithdisabilities.
AAPICOForgingPublicCompany Limited and its SacrificeClubestablisheda so-called “Friend for Friend”project toraise funds forhelping theemployeesand their families inneed.
AAPICO Forging Public Company Limited and its SacrificeClub took the lead in the social project of AAPICOemployees todonate food for theorphanageat theOrphanHouseSinapis,inChonburi.
Quality of Life Training
AAPICO Group joined the campaignfor “Safe Driving” for the New Year2012.
Mr.YeapSweeChuanPresidentandCEO. donated 1,200 packs of ricewhich were donated from BangkokBank PLC. to employees of AAPICOGROUP who were affected by theBigflooded2011.
Representative from AAPICO Hitechreceived a cer t i f icate from theDepartment of Employment for itsgood labor management and socialresponsibility during the big flood inyear2011.
The management of AAPICO Groupgave the retirement bonus to retiredstaff.
The management of AAPICOGroupgavetheBestPictureAwardto the winner of “Mother’s Love”photocompetition.
AAPICO Group and Thai HealthPromotion Foundat ion madecollaboration in the arrangement oftheseminar“OrganizationdevelopmentforSustainableHappyWorkPlace#2”
Annual Report 2012
��
The representative from AAPICOAmataCompanyLimitedreceivedacertificate as the acknowledgementfor the company’s act iveparticipationin“5Sproject-HappyTemple” organized by Thai HealthPromotionFoundation.
Themanagement,QualityofLifeClubandstaffofAAPICOAmataextendedtheroyalgreetingstoHisMajestyTheKingontheoccasionofhisbirthday.Atreewhichwecalled“A father’s tree”made frompaperlike an artificial tree was created anddecoratedonthisoccasion.
AAPICOGroup has been initiating training courses called “Quality of Life Training” with a qualified team of
trainers and lecturers from Thailand Developer Club. Each training course takes 3 days and 2 nights to
complete.Thecourseencouragestheparticipantstorememberandpracticethefundamentaloflife,refrainfrom
vices,encourage loveandunderstandingwithin the family,understand the real rootcausesofdailyproblems
andworkouttheproblemsinawaythatcanimprovetheirqualityoflife.Inaddition,thistrainingattachesgreat
importancetothedevelopmentofself-discipline,teamworkandgoodleadership,andyetthemostimportantis
its continuous encouragement to aim at becoming good persons. The participants have become strong
contributorstoourQualityofLifeClubs.
Since2008AAPICOGrouphasconducted12 trainingsessionswithapproximately1,302participants in total.
Thecompanyhasastrongdetermination tocontinue thisactivitywith thegoalofhaving100%participation
fromitsemployees.
120staffofAAPICOGroupparticipatedintheQualityofLifeTraining#12atKhaoyaiSaranromResortinNakornRatchasimaprovince.
Quality of Life Training
�0
�0Company Contact Information
OEM Auto Parts Manufacturing
Country Company Address Contact
Thailand AAPICOHitechPublicCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160 www.aapico.com
[2ndFactory] 7/289Moo6AmataCityIndustrialEstate Tel: (66)38650888-90
TambolMabyangpornAmpurPluakdaeng Fax: (66)38650804
RayongProvince21140
[CorporateOffice] Rm.2812,28thfloor,TheOfficesatCentralWorld Tel: (66)26131504-6
999/9RamaIRd.,PatumwanBangkok10330 Fax: (66)26131508
AAPICOAmataCo.,Ltd. 700/483Moo2AmataNakornIndustrialEstate Tel: (66)38717200
TambolBankaoAmpurPanthong Fax: (66)38717187
ChonburiProvince20160
AAPICOForgingPublicCo.,Ltd. 700/20Moo6AmataNakornIndustrialEstate Tel: (66)38213355-9
TambolNongmaidaengAmpurMueng-Chonburi Fax: (66)38213360
ChonburiProvince20000
AAPICOHitechPartsCo.,Ltd. 99/2Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
AAPICOMitsuike(Thailand)Co.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
AAPICOPlasticsPublicCo.,Ltd. 358-358/1BangpleeIndustrialEstate Tel: (66)23153456
Moo17TaparukRd.,TambolBangsaothong Fax: (66)23153334
AmpurBangsaothong
SamutprakarnProvince10540
[2ndFactory] 7/288Moo6AmataCityIndustrialEstate Tel: (66)3865088890
TambolMabyangpornAmpurPluakdaeng Fax: (66)38650804
RayongProvince21140
AAPICOStructuralProductsCo.,Ltd. 700/16Moo6AmataCityIndustrialEstate Tel: (66)38717200
TambolNongmaidaengAmpurMueng-Chonburi Fax: (66)38717187
ChonburiProvince20000
AbleSanohIndustries(1996)Co.,Ltd. 98Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
MinthAAPICO(Thailand)Co.,Ltd. 7/290Moo6AmataCityIndustrialEstate Tel: (66)38650865-7
TambolMabyangpornAmpurPluakdaeng Fax: (66)38650864
RayongProvince21140
Annual Report 2012
��
OEM Auto Parts Manufacturing
Country Company Address Contact
SanohIndustries(Thailand)Co.,Ltd. 7/209Moo6AmataCityIndustrialEstate Tel: (66)38956250
TambolMabyangpornAmpurPluakdaeng Fax: (66)38956252
RayongProvince21140
ThaiTakagiSeikoCo.Ltd. 358-358/1BangpleeIndustrialEstate Tel: (66)27058800
Moo17TaparukRd.,TambolBangsaothong Fax: (66)27058808
AmpurBangsaothong
SamutprakarnProvince10540
China KunshanChaitai-Xincheng EconomicandTechnologicalDevelopmentZone Tel: (86)51257671757
PrecisionForgingCo.,Ltd. 405YungueRoad,KunshanCity Fax: (86)51257670964
JiangsuProvince215331
AAPICOShanghaiCo.,Ltd. 3600WaiqingsongRoad Tel: (86)2159744843
QingpuDistrict,Shanghai201709 Fax: (86)2159744704
Design and Manufacture of Assembly Jigs
Country Company Address Contact
Thailand AAPICOHitechToolingCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
Car Distributor & Dealership
Country Company Address Contact
Thailand AbleMotorsCo.,Ltd. 14/9Moo14PhaholyothinRoad Tel: (66)29086001-7
TambolKlongNeungAmpurKlongLuang Fax: (66)29086009
PathumthaniProvince12120
NewEraSalesCo.,Ltd. 66/24Moo14RamindraRoad(km7) Tel: (66)25195800-4
KwangKannayaoKhetKannayao Fax: (66)29465107
Bangkok10230 www.newera-th.com
HyundaiMotor(Thailand)Co.,Ltd. 38Q.HouseConventBldg., Tel: (66)26322777
3rdFloor,ConventRoadSilom Fax: (66)26322647-8
BangrakBangkok10500 www.hyundai-motor.co.th
Malaysia NewEraSales(M)Sdn.Bhd. Lot39821,JalanSemenyih Tel: (60)387370403
43000KajangSelangor Fax: (60)387377406
TenagaSetiaResourcesSdn.Bhd. No.10,Jalan51/217,Section51 Tel: (60)377848411
46050PetalingJayaSelangor Fax: (60)377847411
��
��
Car Navigation
Country Company Address Contact
Thailand AAPICOITSCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160 www.powermap.in.th
AMactionCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
Papago(Thailand)Co.,Ltd. 184/23233Floor,ForumTower Tel: (66)26454117
RatchadapisekRd.Huaykwang
Bangkok10310
Malaysia AAPICOITSCo.Sdn.Bhd. No.10,Jalan51/217,Section51 Tel: (60)377855158
46050PetalingJayaSelangor Fax: (60)377816158
Others
Country Company Address Contact
Thailand AAPICOEngineeringCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
AAPICOJackspeedCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
AERPCo.,Ltd. 99Moo1HitechIndustrialEstate Tel: (66)35350880
TambolBanlaneAmpurBangPa-in Fax: (66)35350881
AyuthayaProvince13160
Katsuya(Thailand)Co.,Ltd. 229/104-105Moo1TaparukRd., Tel: (66)27065915-9
TambolBangsaothong Fax: (66)27065910
AmpurBangsaothong
SamutprakarnProvince10540
Malaysia AAPICOEngineeringSdn.Bhd. No.10,Jalan51/217,Section51 Tel: (60)377848411
46050PetalingJayaSelangor Fax: (60)377847411
SingaporeAAPICOInvestmentPte.Ltd. 745Lorong5,ToaPayoh,TheActuary#03-01, Tel: (65)68361919
Singapore319455
AbleITSPte.Ltd. 745Lorong5,ToaPayoh,TheActuary#03-01, Tel: (65)68361919
Singapore319455
JackspeedCorporationLimited 47LoyangDrive,Singapore508955 Tel: (65)67882088
Fax: (65)67890020
Annual Report 2012
��
Reference
1. Thailand Securities Depository (Thailand) Co., Ltd. : Security Depository Registrar
Address : 62TheStockExchangeofThailandBuilding,
RachadapisekRoad,Klongtoey,Bangkok10110
Telephone : (66)2229-2800,(66)2229-2888
Fax : (66)2359-1259
2. Ernst & Young Office Limited : Auditor
Address : 33rdFloor,LakeRajadaOfficeComplex,
193/136-137RajadapisekRoad,Klongtoey,Bangkok10110
Telephone : (66)2264-0777
Fax : (66)2264-0789
3. Royal Advocates International Limited : Lawyer
Address : 29VanissaBuidling,22/FSuite22A,SoiChidlom,
PloenchitRoad,Lumpini,Patumwan,Bangkok10330
Telephone : (66)2655-2112
Fax : (66)2655-2118
Information as at December 31st, 2012
Abbreviation AH
Registration Number 0107545000179
Type of Business Design, produce, and install assembly jigs, stamping dies, and OEM auto parts,
which include floor parts, brackets, chassis frames, forged and machined parts
including steering and suspension system, cross members, pillars, clips, fuel
tank, etc.
Website www.aapico.com
Established 1996
First day of Exchange in SET 17 October 2002
Address : 99 Moo 1 Hitech Industrial Estate Tambol Ban Lane Amphur Bang Pa-in
Ayuthaya Province 13160
Registered Capital : 271,697,900 Baht Consist of Ordinary 229,337,900 shares*
Preferred 42,360,000 shares*
Paid Up Capital : 268,874,300 Baht Consist of Ordinary 226,514,300 shares*
Preferred 42,360,000 shares*
* Par Value at 1 baht per share
Accounting Cycle 1 January - 31 December
Shareholders The main shareholders include Mr. Yeap Swee Chuan’s Group holding 39.65%
and Sojitz Corporation holding 15.75% of the total outstanding shares. The
remaining is held by institutional and individual investors.
Corporate Information
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
Shar
e Vo
lum
e
40 35 30 25 20 15 5 0
3/1/
2007
9/
2/20
07
21/3
/200
7 3/
5/20
07
13/6
/200
7 20
/7/2
007
30/8
/200
7 8/
10/2
007
15/1
1/20
07
27/1
2/20
07
6/2/
2008
17
/3/2
008
28/4
/200
8 9/
6/20
08
18/7
/200
8 27
/8/2
008
3/10
/200
8 12
/11/
2008
23
/12/
2008
3/
2/20
09
13/3
/200
9 27
/4/2
009
8/6/
2009
20
/7/2
009
27/8
/200
9 5/
10/2
009
11/1
2/20
09
23/1
2/20
09
3/3/
2010
12
/3/2
010
26/4
/201
0 9/
6/20
10
07/1
9/20
10
30/8
/201
0 10
/6/2
010
15/1
1/20
10
24/1
2/20
10
2/3/
2011
15
/3/2
011
27/4
/201
1 6/
9/20
11
20/7
/201
1 29
/8/2
011
10/5
/201
1 14
/11/
2011
23
/12/
2011
2/
2/20
12
13/3
/201
2 25
/4/2
012
6/6/
2012
13
/7/2
012
23/8
/201
2 1/
10/2
012
8/11
/201
2 19
/12/
2012
29
/1/2
013
8/3/
2013
Clos
ed P
rice
(Bah
t) AH Stock Trading History for 2007 - 2012
Unit : 1,000
Volume (Shares) Closed Price
