A Brown Company, Inc.

December 16, 1999 PSE CIRCULAR FOR BROKERS NO. 3209-99 SUBJECT : A Brown Company, Inc . A Brown Company, Inc. ("BRN") furnished the Exchange a copy of its Amended SEC Form 11-Q/Quarterly Report for the quarter ended March 31, 1999 with amendments on the following items: Item 1: Financial Statements (Please see attached amended consolidated financial statements for the quarter ended March 31, 1999) Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations The P303.45 million registered sales in the first 3 months of 1999 continues the uptrend which started in 1998 4th quarter. The sales are strong indications of a recovering market, as well as, the payoffs from the strategies implemented by A Brown's management at the start of 1998. The figure is about 50% higher than P202.99 million reported in same period last year. Even historically, 1999 figures are higher than any first quarter performance, the quarter which has always been considered a seasonally low period. Also, compared to the peak season period which is the 4th quarter, business have been sustained at the P300 million-level per quarter. Although bottom-line figures still show a P54 million loss for the quarter, significant improvements can be seen from an already profitable level of operations where cost components have already been stabilized. Except for the conversion of Notes payable to term-loans with Landbank of the Philippines (LBP) and Metropolitan Bank & Trust Company (MBTC) that are currently in progress, there is no other known trends, events or uncertainties that have or are reasonably likely to have a material impact on the company's short term or long term liquidity. cdll A complete copy of BRN's Amended SEC Form 11-Q for the quarter ended March 31, 1999 is available for reference at the PSE Centre and PSE-Plaza Libraries. For your information. (SGD.) MARIA ISABEL T. GARCIA OIC, Listings and Disclosure Group AMENDED A BROWN COMPANY, INC. & SUBSIDIARIES Consolidated Balance Sheet As of March 31, 1999 (With Comparative Figures for 1998) (In P'000) ASSETS As of 03/31/99(Unaudited) As of 12/31/98(Audited) CURRENT ASSETS Cash 148,442 141,417 LC Account 14,709 0 Receivables 481,975 448,853 Inventories, net 523,562 543,880 Prepaid Expenses and other current assets 116,084 P1,284,772 151,398 P1,285,548 INVESTMENTS 1,700,601 1,756,720 PROPERTY AND EQUIPMENT, Net 326,844 294,393 ADVANCES TO AFFILIATES 59,987 66,865 OTHER ASSETS 32,567 24,611 TOTAL ASSETS P3,404,771 P3,.428,137 ========== ========== LIABILITIES AND STOCKHOLDER'S EQUITY CURRENT LIABILITIES Accounts Payable & accrued expenses 667,457 683,352 Income Tax Payable 15,898 8,089 Trust Receipts Payable 77,980 77,330 Dividends Payable 79 79 Current Notes Payable 972,707 P1,734,121 950,679 P1,719,529 SUBSCRIPTIONS PAYABLE 224,460 224,451 ADVANCES FROM AFFILIATES 50,558 7,535 LONG TERM LIABILITIES United Coconut Planters Bank 249,350 249,350 Landbank of the Philippines 195,491 195,491 Metropolitan Bank & Trust Company 100,000 100,000 Urban Bank 12,000 12,000 Banco De Oro 7,748 7,748 Sub-total 564,589 564,589 Less: Current Portion 3,467 561,122 3,467 561,122 TOTAL LIABILITIES P2,570,261 P2,512,637 DEFERRED CREDIT 6,588 MINORITY INTEREST in consolidated subsidiaries 172 430 STOCKHOLDERS' EQUITY Capital Stock (1,320 Billion @ P1 par value) 1,009,927 1,009,927 Paid In Capital in excess of par value 10,959 10,959 Treasury stock (158) (806) Net Unrealized loss on noncurrent marketable equity securities (16,758) (16,758) Retained Earnings (169,632) (94,840) TOTAL STOCKHOLDERS' EQUITY 834,338 908,482 TOTAL LIABILITIES AND STOCKHOLDER'S P3,404,771 P3,428,137 ========= ========= A BROWN COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS FOR THE FIRST QUARTER ENDED MARCH 31, 1999 (With Comparative Figures for 1998) (In P'00) Three Months Three Months As of 03/31/99 As of 03/31/98 Ended March '99 Ended March '98 (Unaudited) (Unaudited) REVENUES Net Sales P303,451 P202,955 P303,451 P202,955 Other Income 7,206 47,120 7,206 47,120 Equity in net earnings of an affiliate 23 23 Total Revenues P310,657 P250,098 P310,657 P250,098 EXPENSES Cost of Goods and Services 165,717 144,512 165,717 144,512 Opening Expenses 167,820 153,430 167,820 153,430 Marketing Expenses 24,763 35,205 24,763 35,205 Equity in net losses of an affiliate Total Expenses P358,300 P333,147 P358,300 P333,147 INCOME BEFORE TAX (47,643) (83,049) (47,643) (83,049) PROVISION FOR INCOME TAX 6,672 1,029 6,672 1,029 INCOME AFTER TAX P(54,315) P(84,078) P(54,315) P(84,078) Minority Interest in Earnings of Consolidated Subsidiaries (3) (5) (3) (5) NET INCOME P(54,318) P(84,083 P(54,318) P(84,083 Retained Earnings, beginning balance (115,314) 168,961 (115,314) 168,961 RETAINED EARNINGS, Ending Balance P(169,632) P84,878 P(169,632) P84,878 ========= ========= ========= ======== Earnings (Loss) Per Share (0.054) (0.083) (0.054) (0.083) -* No Philrealty FS yet as of May 13, 1999 A BROWN COMPANY INC. (PARENT COMPANY) BALANCE SHEETS (Unaudited) ASSETS As of March 31, 1999 As of Dec. 31, 1998 Cash 985,174.56 5,807,781.00 Receivables 181,624,250.52 190,841,679.00 Investment in Real Estate 493,677,065.64 455,642,320.00 Prepayments 29,919,988.71 29,283,685.00 Deferred Income Tax 38,240,621.26 37,826,695.00 Property, Plant & Equipment 60,881,883.42 61,107,729.00 Investments and Advances 1,246,544,981.84 1,402,756,447.00 Due from Affiliated Companies 92,187,817.36 80,402,742.00 Other Assets 1,505,032.05 1,632,986.00 TOTAL 2,145,466,815.36 2,265,302,064.00 =============== ============== LIABILITIES AND STOCKHOLDERS' EQUITY Bank Loans 474,752,107.00 288,719,562.00 Loans Payable Affiliate 0.00 Accounts Payable & Accrued Expenses 214,608,154.81 304,576,828.00 Dividends Payable 0.00 Subsciptions Payable 241,828,128.00 241,828,128.00 Due to Affiliated Companies 30,275,010.41 30,145,210.00 Long-term Debt 332,750,000.00 494,030,438.00 Stockholders' Equity Capital Stock 1,009,926,933.00 1,009,926,933.00 Additional Paid-In Capital 10,958,725.69 10,958,726.00 Retained Earnings (169,632,243.55) (114,883,761.00) TOTAL 2,145,466,815.36 2,265,302,064.00 =============== ============== A BROWN COMPANY INC. (PARENT COMPANY) STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (DEFICIT) (Unaudited) Three Months Ended March 31, 1999 March 31, 1998 Net Sales-Lot 20,380,096.00 15,108,184.55 Interest 2,906,162.41 4,257,405.72 Rent 44,467.99 2,556,258.20 Others 1,940,081.19 6,187,777.43 25,270,807.59 28,109,625.90 COST AND EXPENSES Cost of sales and services 10,557,228.74 8,324,282.66 Operating expenses 12,356,665.65 18,745,252.30 Marketing expenses 2,246,205.64 1,631,080.76 25,160,160.03 28,700,615.72 OPERATING INCOME (LOSS) BEFORE INTEREST EXPENSE 110,647.56 (590,989.82) INTEREST EXPENSE 52,923,253.77 61,663,204.62 OPERATING INCOME (LOSS) (52,812,606.21) (62,254,194.44) PROVlSION FOR INCOME TAX 1,210,881.69 0.00 INCOME after income tax (COST METHOD) (54,023,487.90) (62,254,194.44) EQUITY IN NET EARNINGS OF SUBSIDIARIES & AFF. COs. (294,000.00) (21,829,839.39) NET INCOME USING EQUITY METHOD (54,317,487.90) (84,084,033.83) Add: Retained Earnings, beginning of the year (115,314,755.65) 412,161,518.82 15% and 10% Stock Dividend/prior years adjustment 0.00 (211,565,003.00) RETAINED EARNINGS AT END OF YEAR (169,632,243.55) 116,512,481.99 ============== ============== Earnings (loss) per share (0.05) (0.08) Certified Correct By: (SGD.) MARIAN C. PINEDA SVP-Finance & Treasury