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Note 19 - Discontinued Operations
 12 Months Ended
Dec. 31, 2011
DISCONTINUED OPERATIONS  
DISCONTINUED OPERATIONS

19.    DISCONTINUED OPERATIONS

 

           The Company entered into an agreement to dispose its 51% equity interest in the SPFO joint venture to a group of investors in exchange for a total cash consideration of RMB18.5 million (approximately $2.9 million), effective upon the directors’ approval on September 7, 2011. The purpose of the disposal is to focus on the Company’s core wire and cable business that are more profitable by divesting its non-core fiber-optics cable, of which the market in china has very competitive. The share transfer was completed on December 1, 2011, consequently, the Company’s deconsolidated SPFO effective December 1, 2011. The Company recognized $1,962 gain on disposal of a subsidiary in consolidated statement of operations.

 

SPFO was consolidated prior to its disposal and it met the criteria for reporting as discontinued operations. Therefore, the results of operations of SPFO and the gain of the disposal have been classified as “Income from operations of discontinued SPFO” in the consolidated statement of operations for the year ended December 31, 2011 and prior periods' amounts have been reclassified accordingly.

 

            Results from discontinued operations related to SPFO for the years ended December 31, 2009 and 2010 and period ended November 30, 2011 are as follows:

 

 

Year ended December 31,

 

2009

2010

2011

 

 

 

 

Net sales

$ 35,993

$ 22,736

$ 30,210

Cost of sales

(30,244)

(18,072)

(25,111)

Gross profit

5,749

4,664

5,099

Selling, general and administrative expenses

(4,456)

(3,545)

(4,809)

Recovery of doubtful accounts

752

377

68

Income from discontinued operations

2,045

1,496

358

Exchange gain, net

20

-

-

Interest income

-

110

129

Interest expenses

(1,000)

(1,197)

(1,336)

Other income (expenses)

85

37

(38)

Income (loss) before income tax

1,150

446

(887)

Gain on disposal of SPFO

-

-

1,962

Income from operations of discontinued SPFO

1,150

446

1,075

Income tax

(697)

(450)

(229)

Net income (loss) of discontinued operations

$ 453

$ (4)

$ 846

Net income (loss) attributable to non-controlling interests

222

(2)

(547)

Net income (loss) attributable to APWC

231

(2)

1,393

 

             The transactions undertaken with related parties are summarized as follows:

 

 

 

Year ended December 31,

 

 

2009

 

2010

 

2011

 

 

 

 

 

 

 

Purchases of goods from Shandong Yanggu

 

-

 

17

 

317

Sales to Shandong Yanggu

 

-

 

96

 

536

Sales to SPRC

 

-

 

160

 

157

Interest expense paid to Shandong Yanggu

 

-

 

63

 

-

Management fee paid to Shandong Yanggu

 

-

 

-

 

387