NOTE B — INVESTMENTS

The Company owns approximately a 30% interest in Grupo Vasconia S.A.B. (“Vasconia”), an integrated manufacturer of aluminum products and one of Mexico’s largest housewares companies. Shares of Vasconia’s capital stock are traded on the Bolsa Mexicana de Valores, the Mexican Stock Exchange (www.bmv.com.mx). The Quotation Key is VASCONI. The Company accounts for its investment in Vasconia using the equity method of accounting and records its proportionate share of Vasconia’s net income in the Company’s statement of operations. Accordingly, the Company has recorded its proportionate share of Vasconia’s net income (reduced for amortization expense related to the customer relationships acquired) for the three and six month periods ended June 30, 2013 and 2012 in the accompanying condensed consolidated statements of operations. The value of the Company’s investment balance has been translated from Mexican Pesos (“MXN”) to U.S. Dollars (“USD”) using the spot rate of MXN 13.00 and MXN 12.97 at June 30, 2013 and December 31, 2012, respectively. The Company’s proportionate share of Vasconia’s net income has been translated from MXN to USD using the average exchange rate of MXN 12.46 and MXN 13.51 during the three months ended June 30, 2013 and 2012, respectively, and 12.57 to 12.79 and 13.24 to 13.29 during the six months ended June 30, 2013 and 2012, respectively. The effect of the translation of the Company’s investment resulted in a decrease to the investment of $0.1 million during the six months ended June 30, 2013 and an increase to the investment of $0.2 million during the six months ended June 30, 2012 (also see Note J). These translation effects are recorded in accumulated other comprehensive loss. Included in prepaid expenses and other current assets at June 30, 2013 and December 31, 2012 are amounts due from Vasconia of $63,000 and $71,000, respectively. During the three months ended June 30, 2013, the Company received a cash dividend of $571,000 from Vasconia related to its 2012 earnings, which was accounted for as a reduction of the carrying value of the investment.

Summarized statement of income information for Vasconia in USD and MXN is as follows:


	Three Months Ended June 30,
	2013						2012
	(in thousands)
	USD			MXN			USD		MXN
Net Sales	$	38,572		$	480,602		$	40,195	$	543,184
Gross Profit		5,953			74,175			8,664		117,081
Income (loss) from operations		(587	)		(7,310	)		3,144		42,481
Net Income		1,421			17,708			2,252		30,426


	Six Months Ended June 30,
	2013				2012
	(in thousands)
	USD		MXN		USD		MXN
Net Sales	$	78,811	$	991,481	$	68,882	$	915,673
Gross Profit		13,870		174,694		16,832		223,145
Income from operations		1,553		19,859		6,465		85,615
Net Income		2,647		33,276		4,216		55,937

The Company recorded equity in earnings of Vasconia, net of taxes, of $0.4 million and $0.6 million for the three months ended June 30, 2013 and 2012, respectively, and $0.6 million and $1.1 million for the six months ended June 30, 2013 and 2012, respectively.

The Company has a 40% equity interest in GS Internacional S/A (“GSI”), a leading wholesale distributor of branded housewares products in Brazil, which the Company acquired in December 2011. The Company recorded equity in losses of GSI of $243,000 and $39,000, net of taxes, for the three months ended June 30, 2013 and 2012, respectively, and $266,000 and $172,000, net of taxes, for the six months ended June 30, 2013 and 2012, respectively.