Equity-Method Investments

During 2010, the Company, through its wholly owned subsidiaries, made total cash investments of $46.2 million in two newly-formed Hong Kong entities, China Merchants Americold Holdings Logistics Company Limited (CMAL) and China Merchants Americold Holdings Company Limited (CMAH, together with CMAL, the Joint Venture). Through these subsidiaries, the Company acquired a 49% interest in the Joint Venture, while China Merchants Holdings International Company (CMHI) acquired the remaining 51% interest in the Joint Venture. CMHI is a Hong Kong based entity that is part of the China Merchants Group. Other affiliates of CMHI subsequently purchased 50,000 shares of the Company’s Series B Preferred Shares. As such, CMHI is considered a related party of the Company. The Joint Venture was formed with the purpose of acquiring, owning, and operating temperature-controlled warehouses, primarily in the People’s Republic of China. During 2015, the Company made an additional capital contribution of $1.3 million to the Joint Venture for general corporate purposes. As of December 31, 2018, the Joint Venture operated 12 warehouses in the People’s Republic of China.

The Company translates amounts in Chinese yuan to U.S. dollars when accounting for its interest in the Joint Venture. As a result, the Company must also adjust the carrying value of its investment in the Joint Venture for its proportionate share of the cumulative unrealized foreign currency translation gains and losses each period. The Company accounts for its investment in the Joint Venture as an equity-method investment, as the Company has a 49% equity interest, but cannot control it. In accounting for its interest in the Joint Venture as an equity-method investment, the Company includes its proportionate share of the Joint Venture’s net income or loss as an increase or decrease in the carrying value of the equity-method investment. In addition, the Company routinely monitors its investment in the Joint Venture to determine whether an other-than-temporary decline in the investment value has occurred.

In 2017, the Company recognized an impairment charge totaling $6.5 million related to our investment in the Joint Venture as we determined that the recorded investment was no longer recoverable from the projected future cash flows expected to be received from the Joint Venture. The estimated fair value of this investment was determined based on an assessment of the proceeds expected to be received from the potential sale of our investment interests to the joint venture partner based on current negotiations.

The condensed summary financial information for the Company’s Joint Venture is as follows:



	2018
Condensed results of operations	CMAL			CMAH		Total
	(In thousands)
Revenues	$	37,458		$	13,621	$	51,079
Operating (loss) income	(1,748		)	2,432		684
Net (loss) income	(1,960		)	1,651		(309		)
Company’s (loss) income from partially owned entities	(1,419		)	350		(1,069		)



	2017
Condensed results of operations	CMAL			CMAH			Total
	(In thousands)
Revenues	$	38,662		$	12,294		$	50,956
Operating (loss) income	(2,052		)	314			(1,738		)
Net loss	(2,479		)	(296		)	(2,775		)
Company’s loss from partially owned entities	(1,143		)	(220		)	(1,363		)



	2016
Condensed results of operations	CMAL			CMAH		Total
	(In thousands)
Revenues	$	34,945		$	9,389	$	44,334
Operating (loss) income	(2,184		)	4,281		2,097
Net (loss) income	(2,645		)	2,791		146
Company’s (loss) income from partially owned entities	(1,396		)	1,268		(128		)



	2018
Condensed balance sheet information	CMAL		CMAH		Total
	(In thousands)
Property, plant and equipment, net	$	10,812	$	19,760	$	30,572
Cash and cash equivalent	9,237		179		9,416
Accounts receivable	5,357		2,316		7,673
Goodwill and other intangible assets	15,043		325		15,368
Due from related parties	—		19,974		19,974
Other assets	9,662		5,727		15,389
Total assets	$	50,111	$	48,281	$	98,392

Debt	$	6,199	$	9,540	$	15,739
Accounts payable	5,007		969		5,976
Due to related parties	—		—		—
Other liabilities	23,094		11,825		34,919
Total liabilities	$	34,300	$	22,334	$	56,634

Equity including non-controlling interest	$	15,811	$	25,947	$	41,758



	2017
Condensed balance sheet information	CMAL			CMAH			Total
	(In thousands)
Property, plant and equipment, net	$	13,108		$	24,559		$	37,667
Cash and cash equivalent	7,935			915			8,850
Accounts receivable	6,416			1,805			8,221
Goodwill and other intangible assets	15,905			344			16,249
Due from related parties	5,900			14,414			20,314
Other assets	6,206			3,745			9,951
Total assets	$	55,470		$	45,782		$	101,252

Debt	$	9,611		$	6,350		$	15,961
Accounts payable	4,651			611			5,262
Due to related parties	17,824			11,384			29,208
Other liabilities	4,483			2,183			6,666
Total liabilities	$	36,569		$	20,528		$	57,097

Equity including non-controlling interest	$	18,901		$	25,254		$	44,155

Company’s equity investment before impairment	$	9,379		$	11,059		$	20,438
Less: Company’s impairment in equity investment	(4,060		)	(2,436		)	(6,496		)
Company’s equity investment	$	5,319		$	8,623		$	13,942

The Company has an investment in another joint venture that is also accounted for as an equity-method investment since the Company can exert significant influence over the operations, but cannot control the joint venture. The carrying amount of this other investment was $2.0 million as of December 31, 2018 and 2017, respectively.