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14. BUSINESS SEGMENTS
 3 Months Ended
Mar. 31, 2013
Segment Reporting [Abstract]  
14. BUSINESS SEGMENTS

The Company has three reportable segments:  bromine, crude salt and chemical products. The reportable segments are consistent with how management views the markets served by the Company and the financial information that is reviewed by its chief operating decision maker.

 

An operating segment’s performance is primarily evaluated based on segment operating income, which excludes share-based compensation expense, certain corporate costs and other income not associated with the operations of the segment. These corporate costs (income) are separately stated below and also include costs that are related to functional areas such as accounting, treasury, information technology, legal, human resources, and internal audit. The Company believes that segment operating income, as defined above, is an appropriate measure for evaluating the operating performance of its segments. All the customers are located in PRC.

 

 Three-Month Period Ended March 31, 2013   Bromine *    

Crude

 Salt *

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 11,734,367     $ 2,450,786     $ 8,317,427     $ 22,502,580     $ -     $ 22,502,580  

Net revenue

(intersegment)

     614,730       -       -       614,730       -       614,730  
Income (loss) from operations before taxes     327,813       538,220       2,096,679       2,962,712       (357,264 )     2,605,448  
Income taxes     180,632       33,266       528,422       742,320       -       742,320  
Income (loss) from operations after taxes     147,181       504,954       1,568,257       2,220,392       (357,264 )     1,863,128  
Total assets     166,871,312       56,641,404       55,994,831       279,507,547       121,682       279,629,229  
Depreciation and amortization     4,377,972       1,559,199       870,317       6,807,488       -       6,807,488  
Capital expenditures     -       -       -       -       -       -  
Write-off / Impairment      -       -       -       -       -       -  

 

 Three-Month Period Ended March 31, 2012   Bromine *    

Crude

 Salt *

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 13,453,882     $ 2,274,924     $ 8,079,868     $ 23,808,674     $ -     $ 23,808,674  

Net revenue

(intersegment)

     754,557       -       -       754,557       -       754,557  
Income (loss) from operations before taxes     2,468,304       548,450       2,242,895       5,259,649       (682,550 )     4,577,099  
Income taxes     662,898       103,866       567,706       1,334,470       -       1,334,470  
Income (loss) from operations after taxes     1,805,406       444,584       1,675,189       3,925,179       (682,550 )     3,242,629  
Total assets     160,068,266       52,592,746       48,624,781       261,285,793       512,684       261,798,477  
Depreciation and amortization     3,664,242       1,363,506       655,415       5,683,163       -       5,683,163  
Capital expenditures     -       -       -       -       -       -  
Write-off / Impairment      -       -       -       -       -       -  

 

* Certain common production overheads, operating and administrative expenses and asset items (mainly cash and certain office equipment) of bromine and crude salt segments in SCHC were split by reference to the average selling price and production volume of respective segment.

 

          Three-Month Period Ended March 31,  
Reconciliations               2013     2012  
Total segment operating income                   $ 2,962,712     $ 5,259,649    
Corporate costs                     (357,264 )     (682,550 )   
Income from operations                     2,605,448       4,577,099    
Other income                     19,837       44,478    
Income before taxes                   $ 2,625,285     $ 4,621,577    

 

The following table shows the major customer(s) (10% or more) for the three-month period ended March 31, 2013.

 

Number   Customer

Bromine

(000’s)

  

Crude Salt

(000’s)

  

Chemical Products

(000’s)

  

Total

Revenue

 (000’s)

  

Percentage of

Total

Revenue (%)

 1   Shandong Morui Chemical Company Limited

 

$ 1,182

  

 

$ 743

  

 

$ 930

   $  2,855   12.7%
TOTAL     $  1,182   $  743   $  930   $  2,855   12.7%

 

 

The following table shows the major customer(s) (10% or more) for the three-month period ended March 31, 2012.

 

Number   Customer  

Bromine

(000’s)

    

Crude Salt

(000’s)

    

Chemical Products

(000’s)

    

Total

Revenue

(000’s)

    

Percentage of

Total Revenue (%)

  
 1   Shandong Morui Chemical Company Limited   $ 1,729     $ 386     $ 999     $ 3,114       13.1%  
 2   Shouguang City Rongyuan Chemical Company Limited   $ 2,022     $ 448     $ -     $ 2,470       10.4%  
TOTAL       $ 3,751     $ 834     $ 999     $ 5,584       23.5%