NOTE D — EQUITY INVESTMENTS

The Company owns approximately 30% of the outstanding capital stock of 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. 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 years ended December 31, 2017, 2016 and 2015 in the accompanying 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 19.68 and MXN 20.70 at December 31, 2017 and 2016, respectively. The Company’s proportionate share of Vasconia’s net income has been translated from MXN to USD using the average exchange rates of MXN 17.81 to 20.30, MXN 18.02 to 19.85 and MXN 14.94 to 16.76, during the years ended December 31, 2017, 2016 and 2015, respectively. The effect of the translation of the Company’s investment resulted in increase of the investment of $1.0 during the year ended December 31, 2017 and a decrease of the investment of $3.2 million and $4.9 million during the years ended December 31, 2016 and 2015, respectively. These translation effects are recorded in accumulated other comprehensive loss. The Company received cash dividends of $28,000, $205,000 and $226,000, from Vasconia during the years ended December 31, 2017, 2016 and 2015, respectively. Included in prepaid expenses and other current assets at December 31, 2017 and 2016 was $64,000 and $83,000 due from Vasconia. Included within accounts payable and accrued expenses at December 31, 2017 and 2016 was $0 and $220,000 due to Vasconia.

Summarized income statement information for the years ended December 31, 2017, 2016 and 2015, as well as summarized balance sheet information as of December 31, 2017 and 2016, for Vasconia in USD and MXN is as follows:


	Year Ended December 31,
	2017				2016				2015
	(in thousands)
Income Statement	USD		MXN		USD		MXN		USD		MXN
Net sales	$	167,283	$	3,157,671	$	149,533	$	2,795,009	$	178,832	$	2,824,399
Gross profit		34,626		655,186		27,205		510,617		33,982		534,285
Income from operations		10,475		199,170		5,611		105,334		10,551		165,507
Net income		1,164		23,983		3,491		68,230		7,353		117,194


	December 31,
	2017				2016
	(in thousands)
Balance Sheet	USD		MXN		USD		MXN
Current assets	$	91,157	$	1,793,832	$	81,509	$	1,687,396
Non-current assets		87,900		1,729,745		83,890		1,736,681
Current liabilities		50,766		998,993		31,303		648,028
Non-current liabilities		39,147		770,352		49,408		1,022,842

The Company recorded equity in earnings of Vasconia, net of taxes, of $0.4 million, $0.6 million and $0.6 million for the years ended December 31, 2017, 2016 and 2015, respectively. Equity in earnings in 2017, 2016 and 2015 includes deferred tax benefit (expense) of $0.2 million, ($0.5) million and ($1.3) million, respectively, due to the requirement to record tax benefits for foreign currency translation losses through other comprehensive income (loss), with a corresponding adjustment to deferred tax liabilities.

As of December 31, 2017, the fair value (based upon the quoted stock price) of the Company’s investment in Vasconia was $31.8 million. The carrying value of the Company’s investment in Vasconia was $23.8 million.

During the year ended December 31, 2016, the Company sold its 40% equity interest in GS Internacional S/A (“GSI”), a wholesale distributor of branded housewares products in Brazil. The Company initially acquired GSI in December 2011 and accounted for this investment using the equity method of accounting; however, impairment losses in 2014 reduced the investment balance to zero. Upon the sale of its equity interest in GSI the Company recognized a net gain of $189,000. This gain is included within equity in earnings (losses), net of tax, and represents the net consideration received of R$2.3 million (approximately $567,000) reduced by currency translation losses of $378,000 recognized upon the sale of the equity interest in GSI.

In February 2012, the Company entered into a joint venture, Grand Venture Holdings Limited (“Grand Venture”), with Manweal Development Limited (“Manweal”), a Chinese corporation, to distribute Mikasa^® products in China, which included an initial investment of $500,000. The Company and Manweal each own 50% of Grand Venture and have rights and obligations proportionate to their ownership percentages. The Company accounts for its investment in Grand Venture using the equity method of accounting and has recorded its proportionate share of Grand Venture’s net loss as equity in earnings (losses) in the Company’s consolidated statements of operations. The Company recorded equity in losses of the joint venture of $8,000, $11,000 and $20,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017 and 2016, the carrying value of the Company’s investment in Grand Venture was $228,000 and $256,000, respectively.