The Management s Discussion and Analysis on the Company s Operating Results based on the Financial Statements for the year 2006 The Overview of the Company s and its Subsidiary s Operating Results Unit : Million Baht (Audited) Jan-Dec 06 Jan-Dec 05 %Change Total Revenues 4,345 3,479 25 TV Revenues 2,710 2,202 23 Radio Revenues 798 555 44 Total Expenses 2,268 1,978 15 Net Profit 1,505 1,104 36 EPS 2.19 1.61 36 The Company s earnings growth in 2006 was still strong with total revenue of Baht 4,345 million, up 25% from 2005. This growth resulted from consistent increase in both television and radio revenues. 1.Television revenues for the year 2006 were Baht 2,710 million, up 23 % from Baht 2,202 million in 2005. Although TV advertising spending in the final quarter of 2006 slightly decreased, compared to the third quarter of the same year,advertising revenues and those generated from the operation of various projects,which accounted for 88% of the total television revenues,consistently grew due to the ability to sell more advertisements and to gain more clients buy-in to the proposed projects. Such as the promotion of the opening of Suvarnabhumi Airport, the promotion of Royal Flora Ratchaphruek 2006, Vocational College Project,Energy Saving Project, Isuzu Caravan-Power Saving, 10-day Safety Campaign, and seasonal programmes, such as AF 3, HM Blues and Behind the Scenes:The Making of King Naresuan. 2. Radio revenues in 2006 rose 44% to Baht 798 million, from Baht 555 million in 2005 due to a change in its policy in taking back the 6 radio stations in Bangkok for its own management.Many successfully-organised concerts and activities such as the Seed Show, SEED Campus and Lookthung Mahanakorn On Tour, as well as cross media promotion of radio activities on TV, for example, the Seed on TV program and MET TV Special contributed to consistent growth in revenue generated from these 2 major radio stations, SEED FM 97.5 and FM 95.In addition, MCOT launched partnership with the world s 4 leading music corporations: EMI,Sony BMG Music Entertainment,Universal and Warner Music Group,and relaunched Radio FM 107 Metropolis which was renamed MET 107 featuring international pop music for young people.It was anticipated that this partnership would have positive impacts on MET 107 s rating and revenue. In 2006, the Company attempted to control costs more efficiently. Total expenses rose only 15 % to Baht 2,268 million, from Baht 1,978 million in 2005 attributable to a 20% increase in SG&A costs to Baht 716 million, which was consistent with higher revenues. TV and radio production costs were up 13% to Baht 1,506 million due to an increase in promotional and marketing activities. The Company s net profit in 2006 were up to 36 %, or Baht 1,505 million,or Baht 2.19 per share. MCOT would pay a dividend of 73 % of annual net profit, or Baht 1.60 per share.(a Baht 0.80-per-share interim dividend has been paid on September 5, 2006 for the operating result of the period between January 1 - June 30 2006). The payment of a Baht-0.80-per-share dividend to be made for the period between July 1 - December 31, 2006 scheduled for May 23, 2007 will be proposed to the 2007 Annual General Meeting of the Shareholders .