Transactions with Related Parties

3 Months Ended

Mar. 31, 2020

Related Party Transactions [Abstract]

Transactions with Related Parties

16. Transactions with Related Parties

We sell minerals to SCR-Sibelco NV, the owner of approximately 65% of the outstanding shares of Covia’s common stock (“Sibelco”), and certain of its subsidiaries (together with Sibelco, collectively, “related parties”).  Sales to related parties amounted to $2.3 million and $2.2 million in the three months ended March 31, 2020 and 2019, respectively.  At March 31, 2020 and December 31, 2019, we had accounts receivable from related parties of $2.8 million and $1.8 million, respectively.  These amounts are included in Accounts receivable, net in the accompanying Condensed Consolidated Balance Sheets.  

We purchase minerals from certain related parties.  Purchases from related parties amounted to $1.0 million in the three months ended March 31, 2020.  At March 31, 2020 and December 31, 2019, we had accounts payable to related parties of $2.3 million and $0.9 million, respectively.  These amounts are included in Accounts payable in the accompanying Condensed Consolidated Balance Sheets.

On June 1, 2018, we entered into an agreement with Sibelco whereby Sibelco provides sales and marketing support for certain products supporting the performance coatings and polymer solutions markets in North America and Mexico, for which we pay a 5% commission of revenue, and in the rest of the world, for which we pay a 10% commission of revenue.  Sibelco also assists with sales and marketing efforts for certain products in the ceramics and sanitary ware industries outside of North America and Mexico for which we pay a 5% commission of revenue.  In addition, we provide sales and marketing support to Sibelco for certain products used in ceramics in North America and Mexico for which we earn a 10% commission of revenue.  We recorded net commission expense of $0.6 million and $1.0 million in the three months ended March 31, 2020 and 2019, respectively.  These amounts are recorded in Selling, general and administration expenses.