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EQUITY INVESTMENTS | 12 Months Ended
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Dec. 31, 2023
Equity Method Investments and Joint Ventures [Abstract] |
EQUITY INVESTMENTS | EQUITY INVESTMENTS The Company owns 24.7% of the outstanding capital stock of Vasconia, an integrated manufacturer of aluminum products and a housewares company in Mexico. 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, 2023, 2022 and 2021 in the accompanying consolidated statements of operations. On June 30, 2021, Vasconia issued additional shares of its stock, which diluted the Company’s investment ownership from approximately 30% to approximately 27%. The Company recorded a non-cash gain of $1.7 million, increasing the Company’s investment balance. Additionally, a loss of $2.0 million was recognized for the proportionate share of the diluted ownership for amounts previously recognized in accumulated other comprehensive loss. The net loss of $0.3 million was included in equity in earnings, net of taxes, in the accompanying consolidated statements of operations for the year ended December 31, 2021. On July 29, 2021, the Company sold 2.2 million shares further reducing its ownership from approximately 27% to 24.7% in Vasconia for net cash proceeds of approximately $3.1 million, as a result the Company recorded a gain of $1.0 million, after decreasing the Company’s investment balance. The gain on the sale resulted in a tax expense of $0.1 million. Additionally, a loss of $1.4 million was recognized for the proportionate share of the reduced ownership for amounts previously recognized in accumulated other comprehensive loss. The net loss, including taxes, of $0.5 million was included in equity in earnings, net of taxes, in the accompanying consolidated statements of operations for the year ended December 31, 2021. The Company continues to apply the equity method of accounting. The Company’s equity in earnings, net of tax, for 2023, 2022 and 2021 are as follows:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| (in thousands) |  |
Vasconia equity in earnings, net of taxes | $ | (5,831) |  |  | $ | (3,300) |  |  | $ | 1,769 |
Net loss on dilution in Vasconia ownership | — |  |  | — |  |  | (297) |
Net loss on partial sale of Vasconia ownership, net of taxes | — |  |  | — |  |  | (510) |
Impairment on investment in Vasconia | (6,834) |  |  | (6,167) |  |  | — |
Equity in (losses) earnings, net of taxes | $ | (12,665) |  |  | $ | (9,467) |  |  | $ | 962 |
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 M XN 16.96 an d MXN 19.47 at December 31, 2023 and 2022, respectively. The Company’s proportionate share of Vasconia's net income (loss) has been translated from MXN to USD using the following exchange rates:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
Average exchange rate (MXN to USD) | 17.06 - 18.66 |  | 19.67 - 20.50 |  | 20.01 - 20.74
The effect of the translation of the Company’s investment, as well as the translation of Vasconia’s balance sheet, resulted in an increase of the investment of $2.0 million during the year ended December 31, 2023 and a decrease of the investment of $0.3 million during the year ended December 31, 2022. These translation effects are recorded in accumulated other comprehensive loss. The Company received cash dividends of $0.2 million, from Vasconia during the years ended December 31, 2021. There was no cash dividend received during the years ended December 31, 2023 and 2022. Amounts due to and from Vasconia are recorded in the Company’s consolidated balance sheet within prepaid expenses, other current assets, accrued expenses and accounts payable. As of December 31, 2023 and 2022, these amounts were not material individually or in the aggregate. Summarized income statement information for the years ended December 31, 2023, 2022 and 2021, as well as summarized balance sheet information as of December 31, 2023 and 2022, for Vasconia, calculated in accordance with U.S. GAAP, in USD and MXN is as follows:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| (in thousands)
| USD |  | MXN |  | USD |  | MXN |  | USD |  | MXN
Income Statement |  |  |  |  |  |  |  |  |  |  |
Net sales | $ | 173,104 |  |  | $ | 3,069,162 |  |  | $ | 240,910 |  |  | $ | 4,846,328 |  |  | $ | 240,186 |  |  | $ | 4,871,845 |
Gross profit | 35,158 |  |  | 622,451 |  |  | 39,874 |  |  | 802,496 |  |  | 52,574 |  |  | 1,064,557 |
Loss (income) from operations | (10,944) |  |  | (192,551) |  |  | (1,596) |  |  | (30,323) |  |  | 15,536 |  |  | 313,156 |
Net income | (23,591) |  |  | (416,505) |  |  | (13,207) |  |  | (262,251) |  |  | 7,017 |  |  | 141,972 |
| December 31,
| 2023 |  | 2022
| (in thousands)
| USD |  | MXN |  | USD |  | MXN
Balance Sheet |  |  |  |  |  |  |
Current assets | $ | 117,382 |  |  | $ | 1,991,347 |  |  | $ | 129,449 |  |  | $ | 2,519,905 |
Non-current assets | 152,708 |  |  | 2,590,649 |  |  | 144,356 |  |  | 2,810,082 |
Current liabilities | 186,134 |  |  | 3,157,716 |  |  | 93,112 |  |  | 1,812,546 |
Non-current liabilities | 13,927 |  |  | 236,269 |  |  | 95,065 |  |  | 1,850,568 |
The fair value (based on Level 1 inputs using the quoted stock price) of the Company’s investment in Vasconia declined in 2023. As a result of the decline in the quoted stock price, the downgrade in Vasconia’s debt rating, and the continued decline in the operating results of Vasconia, the Company determined the decline in fair value was other than temporary. The Company reduced its investment by $6.8 million as of September 30, 2023 to its fair value, and recognized the non-cash impairment charge within Equity in (losses) earnings, net of taxes, in the consolidated statement of operations. As of December 31, 2023, the fair value of the Company’s investment in Vasconia was $4.3 million. The carrying value of the Company’s investment in Vasconia, after the recorded impairment, was $1.8 million. As of December 31, 2023, there is substantial doubt about Vasconia’s ability to continue as a going concern for twelve months beyond the date of the financial statements. In the event Vasconia does not continue, the Company would be required to reduce its investment in Vasconia and recognize a loss for amounts previously recognized in accumulated other comprehensive loss.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (a)(3) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481687/323-10-50-3 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481687/323-10-50-3 Reference 3: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Topic 323 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481543/323-740-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 323 -Publisher FASB -URI https://asc.fasb.org//323/tableOfContent + Details
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