) Management Discussion and Analysis

Free cash flow after Capex 2,324 3,454 -33% Dividends (1,489) (182) 718% Proceeds from issues of shares 3,825 0 n/a Changes in net debt (4,660) (3,272) 42% Note: The consolidated financials are based upon elimination of intra-company (or intra business segment) transactions reason which the total of each segment may not tally with consolidated financials. Table 2 IVL : FINANCIAL RATIOS 4Q10 3Q10 4Q09 FY10 FY09 Current ratio (times) 1.1 1.0 0.9 1.1 0.9 Net gearing ratio (%) 48% 49% 63% 48% 63% * Net operating gearing ratio (%) 48% 49% 61% 48% 61% Interest coverage ratio (times) 12.0 11.3 7.6 10.7 7.0 ** ROE (%) 54.4% 46.1% 33.2% 42.9% 32.2% *** ROCE (%) 22.0% 19.1% 13.3% 17.4% 14.3% * Based on net operating debt which is net debt less debt for capex and investments not generating revenue and earnings ** Net profit after minority to average total equity attributable to shareholders *** Operating income to average capital employed (net operating debt plus total shareholder's equity) PET Table 3 PET : CAPACITY AND UTILISATION (%) 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Production capacity (in Tonnes) 374,856 374,856 320,412 0% 17% 1,402,013 1,036,944 35% Production volumes (in Tonnes) 342,930 344,926 300,843 -1% 14% 1,306,728 1,047,414 25% Utilisation rate (%) 91% 92% 94% 93% 101% *Capacity based on available days in the quarter for production. From 4Q09 onwards, PET capacity and volumes include a line switched from Polyester fibers to PET Table 4 PET : REVENUES 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 Total revenues Baht in millions 14,495 14,548 12,018 0% 21% 58,073 44,860 29% USD in millions 483 460 361 5% 34% 1,832 1,307 40% Growth in Baht revenues from: Volume growth -7% 12% 25% Price movement 9% 21% 13% Exchange rate movement -2% -13% -9% Proportion of revenues by geographic Thailand 7% 8% 7% 7% 6% Asia (excluding Thailand) 4% 5% 7% 5% 4% North America 34% 37% 23% 34% 26% Europe 46% 45% 55% 47% 57% Rest of the World 8% 6% 8% 7% 6% Table 5 PET : OPERATING EBITDA AND MARGIN 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Operating EBITDA Baht in millions 2,088 1,994 1,325 5% 58% 7,511 5,979 26% USD in millions 70 63 40 10% 75% 237 174 36% Margin (%) 14.4% 13.7% 11.0% 12.9% 13.3% * Based on pro-rata allocation of earnings of PTA business calculated on intra-group sales to PET and Polyester fibers POLYESTER & WOOL Table 6 POLYESTER & WOOL : CAPACITY AND UTILIZATION (%) POLYESTER FIBERS & YARNS 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Production capacity (in Tonnes) 70,777 70,777 64,425 0% 10% 262,948 328,300 -20% **Production volumes (in Tonnes) 74,225 71,951 68,295 3% 9% 278,930 297,750 -6% Utilisation rate (%) 105% 102% 106% 106% 91% WOOL YARNS 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Production capacity (in Tonnes) 1,487 1,487 1,487 0% 0% 5,900 5,900 0% **Production volumes (in Tonnes) 1,424 1,313 824 8% 73% 5,068 3,062 66% Utilisation rate (%) 96% 88% 55% 86% 52% *Capacity based on available days in the quarter for production. From 4Q09 onwards, Polyester fibers and yarns capacity and volumes exclude a line switched from Polyester fibers to PET **Production volumes based on equivalent production Table 7 POLYESTER & WOOL : REVENUES 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 Total revenues Baht in millions 3,610 3,275 3,218 10% 12% 13,593 11,264 21% USD in millions 120 104 97 16% 25% 429 328 31% Growth in Baht revenues from: Volume growth 6% 6% -3% Price movement 7% 15% 32% Exchange rate movement -3% -9% -7% Proportion of revenues by geographic Thailand 23% 25% 24% 23% 22% Asia (excluding Thailand) 51% 29% 30% 40% 44% North America 5% 6% 5% 6% 5% Europe 16% 19% 24% 18% 14% Rest of the World 5% 21% 16% 12% 15% Table 8 POLYESTER & WOOL : OPERATING EBITDA AND MARGIN 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Operating EBITDA Baht in millions 810 613 429 32% 89% 2,218 1,345 65% USD in millions 27 19 13 39% 110% 70 39 78% Margin (%) 22.4% 18.7% 13.3% 16.3% 11.9% * Based on pro-rata allocation of earnings of PTA business calculated on intra-group sales to PET and Polyester fibers PTA Table 9 PTA : CAPACITY AND UTILISATION (%) 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Production capacity (in Tonnes) 400,767 400,767 400,767 0% 0% 1,590,000 1,590,000 0% Production volumes (in Tonnes) 407,405 403,870 390,138 1% 4% 1,594,777 1,584,683 1% Utilisation rate (%) 102% 101% 97% 100% 100% *Capacity based on available days in the quarter for production. Table 10 PTA : REVENUES 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 Total revenues Baht in millions 13,571 11,190 11,804 21% 15% 47,991 45,981 4% USD in millions 453 354 354 28% 28% 1,514 1,340 13% Growth in Baht revenues from: Volume growth 2% 5% -1% Price movement 21% 17% 11% Exchange rate movement -2% -8% -6% Sales to PET business Baht in millions 4,750 3,865 4,522 23% 5% 16,529 15,891 4% USD in millions 158 122 136 30% 17% 521 463 13% Sales to Polyester business Baht in millions 1,806 1,380 1,597 31% 13% 6,270 6,220 1% USD in millions 60 44 48 38% 26% 198 181 9% Total revenues after eliminations Baht in millions 7,015 5,945 5,685 18% 23% 25,193 23,870 6% USD in millions 234 188 171 24% 37% 795 696 14% PTA integration ratio (%) 48% 47% 52% 48% 48% 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 Proportion of revenues (after eliminations) by geographic Thailand 23% 28% 28% 26% 28% Asia (excluding Thailand) 68% 63% 57% 63% 52% North America 0% 0% 0% 0% 0% Europe 5% 2% 8% 7% 13% Rest of the World 4% 7% 7% 4% 8% Table 11 PTA : OPERATING EBITDA AND MARGIN 4Q10 vs. FY10 vs. 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 *Operating EBITDA Baht in millions 1,354 1,068 902 27% 50% 4,076 3,750 9% USD in millions 45 34 27 34% 67% 129 109 18% Margin (%) 19.3% 18.0% 15.9% 16.2% 15.7% * Based on pro-rata allocation of earnings of PTA business calculated on intra-group sales to PET and Polyester fibers IVL CONSOLIDATED STATEMENT OF INCOME 4Q10 vs. FY10 vs. Baht in millions 4Q10 3Q10 4Q09 3Q10 4Q09 FY10 FY09 FY09 Net sales 25,119 23,769 20,922 6% 20% 96,858 79,994 21% *Cost of sales 20,643 20,068 18,053 3% 14% 82,125 67,666 21% Gross profit 4,476 3,701 2,869 21% 56% 14,733 12,328 20% *Selling and administrative expenses 1,300 1,450 1,194 -10% 9% 5,582 5,045 11% Other income (expense), net (14) 58 30 -124% -147% 116 95 22% Foreign exchange gain (loss) 184 480 147 -62% 25% 1,178 568 107% EBITDA 4,234 3,639 2,693 16% 57% 13,777 11,106 24% Depreciation and amortization 888 850 841 4% 6% 3,332 3,160 5% Operating income 3,346 2,789 1,852 20% 81% 10,445 7,946 31% **Extraordinary items 1,152 736 210 57% 449% 2,451 210 1067% Interest income 2 2 (1) 0% -300% 7 18 -61% Interest expense 354 324 353 9% 0% 1,293 1,601 -19% Profit (loss) before tax 4,146 3,203 1,708 29% 143% 11,610 6,573 77% Income tax expense 117 113 143 4% -18% 488 554 -12% Profit (loss) for the period 4,029 3,090 1,565 30% 157% 11,122 6,019 85% Minority interest 21 157 186 -87% -89% 562 1,195 -53% Net profit after minority interest 4,008 2,933 1,379 37% 191% 10,560 4,824 119% Weighted average no. of shares (in Million) 4,334 4,334 3,352 0% 29% 4,240 3,352 27% Annualised earnings per share (in Baht) 3.70 2.71 1.65 37% 125% 2.49 1.44 73% *Includes depreciation and amortization expenses **Includes gain on bargain purchase on new acquisitions and share of equity income from joint venture company in Italy Note: The consolidated financials are based upon elimination of intra-company (or intra business segment) transactions. For this reason the total of each segment may not tally with consolidated financials. IVL CONSOLIDATED BALANCE SHEET Dec-10 vs. Baht in millions Dec-10 Sep-10 Dec-09 Sep-10 Dec-09 Assets Cash and current investments 2,024 2,777 2,560 -27% -21% Trade accounts receivable 11,771 10,583 9,963 11% 18% Inventories 11,384 9,439 9,674 21% 18% Other current assets 965 1,194 1,369 -19% -30% Total current assets 26,144 23,993 23,566 9% 11% Investment 2,013 891 0 126% n/a Property, plant and equipment 48,748 47,736 49,505 2% -2% Intangible assets 760 788 879 -4% -14% Other assets 340 306 310 11% 10% Total assets 78,005 73,714 74,260 6% 5% Liabilities Bank OD and short-term loans from financial institutions 5,365 5,986 10,004 -10% -46% Trade accounts payable 10,858 9,326 9,004 16% 21% Current portion of long-term loans 5,954 5,632 4,667 6% 28% Current portion of finance lease liabilities 22 24 25 -8% -12% Other current liabilities 1,881 1,909 2,085 -1% -10% Total current liabilities 24,080 22,877 25,785 5% -7% Long-term loans from financial institutions 20,805 19,896 25,331 5% -18% Finance lease liabilities 58 62 73 -6% -21% Other liabilities 657 677 605 -3% 9% Total liabilities 45,600 43,512 51,794 5% -12% Shareholder's equity Share capital 4,334 4,334 3,352 0% 29% Share premium 13,031 13,031 4,443 0% 193% Retained earnings 18,910 15,030 10,093 26% 87% Reserves (4,206) (5,505) (709) -24% 493% Total equity attributable to shareholders 32,069 26,890 17,179 19% 87% Minority interest 336 3,312 5,287 -90% -94% Total shareholder's equity 32,405 30,202 22,466 7% 44% Total liabilities and shareholder's equity 78,005 73,714 74,260 6% 5% Note: The consolidated financials are based upon elimination of intra-company (or intra business segment) transactions. For this reason the total of each segment may not tally with consolidated financials. ______________________________________________________________________