Explanation net profit of year 2003 compared to year 2002

Translation Date February 27, 2004 Subject:Explanation on the reduction of a net profit as ended 31 December 2003 compared to a net profit as ended 31 December 2002 Attention: Directors and Manager of The Stock Exchange of Thailand With reference to the Consolidated Financial Statements of Dusit Thani Public Company Limited for the year 2003 which showed total revenue decrease from year 2002 Baht 175 million or 7.23%, the main causes which affected the business of the Company are SARS and the war between Iraq and America which had a direct impact the hotel business resulting in a decrease in revenue of hotel business under Dusit Thani and Royal Princess. Additionally, as a result of flooding during the month of October in Petchaburi, a large number of clients canceled numerous reservations at Dusit Resort and Polo Club. Other than outside factors causing the decrease in Company revenue, there are other internal factors which have cause effect to the revenue of the Company. A total of 237 rooms, the banquet hall and circulation areas of the E-Wing at Dusit Thani Hotel Bangkok was closed in the third quarter for renovations and refurbishment. At the same time, 159 rooms and 1 pool at Dusit Resort Pattaya was also closed for renovations and refurbishment. On the expense side of 2003 the Company had efficient cost management which effect and hence reduced the cost of sales and management costs by 7.49% and reduced sales and management expenses by 3.86%. However, the Company has extended the land lease agreement with the Crown Property Bureau for a period of 15 years starting 1 April 2003 and ending 31 March 2018, rental payment settled for 15 years totaling Baht 1,100 million resulting in rental expense increase in 2003 Baht 55 million. Furthermore, expenses incurred irregular from usual operations as a result of increase in provision of doubtful debt, computer system upgrading and various others totally Baht 36 million, resulting in an increase in the sales and management expenses. The factor as described above caused the Company to net profit in 2003 Baht 314million, decreased from previous year 2002 by Baht 127 million or 28.77%. Currently, the Company is still renovating the hotels continually to maintain the standards of 5-star hotels and Dusit standard. In the past year, has renovated Hamilton's restaurant at Dusit Thani Bangkok and converted China Town Restaurant into an Italian restaurant named il Cielo. After renovations, both restaurants are more modern and has attracted more clients to the services. Eventhough the renovation period caused the Company's revenue to diminish slightly. However, the Company is hopeful that once the renovations are completed and if there are no further serious effects on the business, the Company's performance should be better.