INVESTMENTS

3 Months Ended

Mar. 31, 2022

Equity Method Investments and Joint Ventures [Abstract]

As of March 31, 2022, the Company owned 24.7% 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. For the period ended March 31, 2021, the Company's investment ownership was 30.0%. The Company's investment ownership decreased to approximately 27.0% on June 30, 2021 and was further reduced to 24.7% on July 29, 2021 as a result of transactions that occurred in those periods. 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 condensed consolidated statements 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 months ended March 31, 2022 and 2021 in the accompanying unaudited 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 rates of MXN 19.88 and MXN 20.46 at March 31, 2022 and December 31, 2021, respectively.

The Company’s proportionate share of Vasconia’s net income (loss) has been translated from MXN to USD using the following exchange rates:


	Three Months Ended March 31,
	2022	2021
Average exchange rate (USD to MXN)	20.50	20.33

The effect of the translation of the Company’s investment, as well as the translation of Vasconia’s balance sheet, resulted in an increase to the investment of $0.1 million and $1.3 million during the three months ended March 31, 2022 and 2021, respectively. These translation effects are recorded in accumulated other comprehensive loss.

Summarized income statement information for the three months ended March 31, 2022 and 2021 for Vasconia in USD and MXN is as follows (in thousands):


	Three Months Ended March 31,
	2022				2021
	USD		MXN		USD		MXN
Net sales	$	64,318	$	1,318,513	$	53,606	$	1,089,817
Gross profit	14,420		295,618		11,958		243,103
Income from operations	4,685		96,040		3,784		76,933
Net income (loss)	1,731		35,479		(770)		(15,661)

The Company recorded equity in earnings (losses) of Vasconia, net of taxes, of $0.4 million and $(0.2) million for the three months ended March 31, 2022 and 2021, respectively.

Included within the Company's unaudited condensed consolidated balance sheets were the following amounts due to and due from Vasconia (in thousands):


Vasconia due to and due from balances	Balance Sheet Location	March 31, 2022		December 31, 2021
Amounts due from Vasconia	Prepaid expenses and other current assets	$	57	$	80
Amounts due to Vasconia	Accrued expenses and Accounts payable	(105)		(146)

As of March 31, 2022 and December 31, 2021, the fair value (based on Level 1 inputs using the quoted stock price) of the Company’s investment in Vasconia was $28.7 million and $31.5 million, respectively. The carrying value of the Company’s investment in Vasconia was $22.8 million and $22.3 million as of March 31, 2022 and December 31, 2021, respectively.