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13. BUSINESS SEGMENTS
 9 Months Ended
Sep. 30, 2014
Segment Reporting [Abstract]  
13. 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 September 30, 2014

   Bromine*    

Crude

 Salt*

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 15,973,528     $ 2,655,028     $ 12,478,408     $ 31,106,964     $ -     $ 31,106,964  

Net revenue

(intersegment)

     832,946       -       -       832,946       -       832,946  
Income (loss) from operations before taxes     3,131,684       (431,901 )     4,161,811       6,861,594       (167,005 )     6,694,589  
Income taxes     793,882       (109,510 )     1,048,489       1,732,861       -       1,732,861  
Income (loss) from operations after taxes     2,337,802       (322,391 )     3,113,322       5,128,733       (167,005 )     4,961,728  
Total assets     190,832,648       54,799,590       75,322,416       320,954,654       43,825       320,998,479  
Depreciation and amortization     4,266,547       1,638,806       887,710       6,793,063       -       6,793,063  
Capital expenditures     5,342,659       1,116,591       -       6,459,250       -       6,459,250  

 

Three-Month

Period Ended September 30, 2013

   Bromine*    

Crude

 Salt*

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 17,093,087     $ 3,902,979     $ 11,939,211     $ 32,935,277     $ -     $ 32,935,277  

Net revenue

(intersegment)

     781,866       -       -       781,866       -       781,866  
Income (loss) from operations before taxes     5,876,150       1,635,755       3,740,278       11,252,183       (359,663 )     10,892,520  
Income taxes     1,452,755       425,640       940,049       2,818,444       -       2,818,444  
Income (loss) from operations after taxes     4,423,395       1,210,115       2,800,229       8,433,739       (359,663 )     8,074,076  
Total assets     180,313,532       58,306,651       63,073,106       301,693,289       32,604       301,725,893  
Depreciation and amortization     4,123,370       1,873,318       885,945       6,882,633       -       6,882,633  
Capital expenditures     238,689       69,933       6,091       314,713       -       314,713  

 

Nine-Month

Period Ended September 30, 2014

   Bromine*    

Crude

 Salt*

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 43,950,056     $ 8,012,368     $ 36,489,530     $ 88,451,954     $ -     $ 88,451,954  

Net revenue

(intersegment)

     2,453,779       -       -       2,453,779       -       2,453,779  
Income (loss) from operations before taxes     7,748,981       94,609       12,123,116       19,966,706       (138,901 )     19,827,805  
Income taxes     1,964,367       17,483       3,053,583       5,035,433       -       5,035,433  
Income (loss) from operations after taxes     5,784,614       77,126       9,069,533       14,931,273       (138,901 )     14,792,372  
Total assets     190,832,648       54,799,590       75,322,416       320,954,654       43,825       320,998,479  
Depreciation and amortization     13,194,940       4,738,524       2,668,597       20,602,061       -       20,602,061  
Capital expenditures     5,342,659       1,116,591       -       6,459,250       -       6,459,250  

 

Nine-Month

Period Ended September 30, 2013

   Bromine*    

Crude

 Salt*

    

Chemical

 Products

    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 46,300,730     $ 9,983,741     $ 32,007,282     $ 88,291,753     $ -     $ 88,291,753  

Net revenue

(intersegment)

     2,174,342       -       -       2,174,342       -       2,174,342  
Income (loss) from operations before taxes     10,086,575       2,902,613       9,408,993       22,398,181       (1,521,438 )     20,876,743  
Income taxes     2,574,710       668,660       2,366,116       5,609,486       -       5,609,486  
Income (loss) from operations after taxes     7,511,866       2,233,952       7,042,877       16,788,695       (1,521,438 )     15,267,257  
Total assets     180,313,532       58,306,651       63,073,106       301,693,289       32,604       301,725,893  
Depreciation and amortization     12,811,261       5,120,004       2,636,907       20,568,172       -       20,568,172  
Capital expenditures     238,689       69,933       6,091       314,713       -       314,713  

 

* 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 September 30,

    

Nine-Month Period

Ended September 30,

  
Reconciliations   2014     2013     2014     2013  
Total segment operating income   $ 6,861,594     $ 11,252,183     $ 19,966,706     $ 22,398,181  
Corporate costs     (167,005 )     (359,663 )     (138,901 )     (1,521,438 )
Income from operations     6,694,589       10,892,520       19,827,805       20,876,743  
Other income, net of expense     76,675       35,653       197,181       81,336  
Income before taxes   $ 6,771,264     $ 10,928,173     $ 20,024,986     $ 20,958,079  

  

The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 2014.

 

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

   $ 2,212     $ 673     $ 1,916     $ 4,801       15.4%  
TOTAL       $ 2,212     $ 673     $ 1,916     $ 4,801       15.4%  
                                               

 

The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 2014.

 

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

   $ 6,300     $ 1,936     $ 5,237     $ 13,473       15.2%  
TOTAL       $ 6,300     $ 1,936     $ 5,237     $ 13,473       15.2%  
                                               

 

The following table shows the major customer(s) (10% or more) for the three-month period ended September 30, 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

   $ 2,078     $ 934     $ 1,223     $ 4,235       12.9%  
TOTAL       $ 2,078     $ 934     $ 1,223     $ 4,235       12.9%  
                                               

 

The following table shows the major customer(s) (10% or more) for the nine-month period ended September 30, 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

   $ 5,425     $ 2,428     $ 3,278     $ 11,131       12.6%  
TOTAL       $ 5,425     $ 2,428     $ 3,278     $ 11,131       12.6%