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13. BUSINESS SEGMENTS
 3 Months Ended
Mar. 31, 2017
Segment Reporting [Abstract]  
13. BUSINESS SEGMENTS

The Company has four reportable segments:  bromine, crude salt, chemical products and natural gas. 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, 2017   Bromine *    

Crude

 Salt *

    

Chemical

 Products

   Natural Gas    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 13,922,394     $ 1,813,778     $ 17,052,321   $ -     $ 32,788,493     $ -     $ 32,788,493  

Net revenue

(intersegment)

     2,178,493       -       -     -       2,178,493       -       2,178,493  
Income (loss) from operations before taxes     5,271,933       885,888       4,946,177     (23,758 )     11,080,240       (267,243 )     10,812,997  
Income taxes     1,330,103       223,582       1,268,141     -       2,821,826       -       2,821,826  
Income (loss) from operations after taxes     3,941,830       662,306       3,678,036     (23,758 )     8,258,414       (267,243 )     7,991,171  
Total assets     155,178,113       28,641,633       192,675,503     1,802,854       378,298,103       37,109       378,335,212  
Depreciation and amortization     3,390,400       454,447       986,070     -       5,439,098       -       5,439,098  
Goodwill     -       -       27,820,174     -       27,820,174       -       27,820,174  

  

 Three-Month Period Ended March 31, 2016   Bromine *    

Crude

 Salt *

    

Chemical

 Products

   Natural Gas    

Segment

 Total

     Corporate     Total  

Net revenue

(external customers)

   $ 13,169,528     $ 1,766,608     $ 19,559,314   $ -     $ 34,495,450     $ -     $ 34,495,450  

Net revenue

(intersegment)

     1,822,202       -       -     -       1,822,202       -       1,822,202  
Income (loss) from operations before taxes     3,005,518       227,613       5,723,731     -       8,956,862       (290,544 )     8,666,318  
Income taxes     743,370       63,504       1,460,797     -       2,267,671       -       2,267,671  
Income (loss) from operations after taxes     2,262,148       164,109       4,262,934     -       6,689,191       (290,544 )     6,398,647  
Total assets     150,811,432       30,335,316       185,961,792     -       367,108,540       36,152       367,144,692  
Depreciation and amortization     4,367,792       1,192,666       1,309,263     -       6,869,721       -       6,869,721  
Goodwill     -       -       29,706,970     -       29,706,970       -       29,706,970  

  

* 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         2017     2016  
Total segment operating income         $ 11,080,240     $ 8,956,862    
Corporate costs           (129,988 )     (160,082 )   
Unrealized loss on translation of intercompany balance           (137,255 )     (130,462 )  
Income from operations           10,812,997       8,666,318    
Other income           83,949       68,317    
Income before taxes         $ 10,896,946     $ 8,734,635    

 

The following table shows the major customer(s) (10% or more) for the three-month period ended March 31, 2017.

 

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

 

$ 2,594

  

 

$ 497

  

 

$ 1,085

   $  4,176   12.7%

 

The following table shows the major customer(s) (10% or more) for the three-month period ended March 31, 2016.

 

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

 

$ 2,422

  

 

$ 487

  

 

$ 1,301

   $  4,210   12.2%