INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY ("AMAK")

3 Months Ended

Mar. 31, 2015

INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY ("AMAK") [Abstract]

INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY ("AMAK")

15. INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY (“AMAK”)

As of March 31, 2015, and December 31, 2014, the Company had a non-controlling equity interest (35%) of approximately $53.1 million and $53.0 million, respectively. This investment is accounted for under the equity method. There were no events or changes in circumstances that may have an adverse effect on the fair value of our investment in AMAK at March 31, 2015.

AMAK’s financial statements were prepared in the functional currency of AMAK which is the Saudi Riyal (SR).  In June 1986 the SR was officially pegged to the U. S. Dollar (USD) at a fixed exchange rate of 1 USD to 3.75 SR.

The summarized results of operation and financial position for AMAK are as follows:

Results of Operations

	Three Months Ended March 31,
	2015			2014
	(Thousands of Dollars)
Sales	$	5,301		$	267
Gross Profit		1,712			639
General, administrative and other expenses		2,501			2,588
Net Loss	$	(789	)	$	(1,949	)

Financial Position

	March 31,		December 31,
	2015		2014
	(Thousands of Dollars)
Current assets	$	31,420	$	17,782
Noncurrent assets		263,765		265,584
Total assets	$	295,185	$	283,366
Current liabilities	$	26,597	$	23,034
Long term liabilities		76,644		67,598
Shareholders' equity		191,944		192,734
	$	295,185	$	283,366

The equity in the income or loss of AMAK reflected on the consolidated statement of income for the three months ended March 31, 2015, and 2014, is comprised of the following:

	Three months ended March 31,
	2015			2014
	(Thousands of Dollars)
Company’s share of loss reported by AMAK	$	(278	)	$	(687	)
Amortization of difference between Company’s investment in   AMAK and Company’s share of net assets of AMAK		337			337
Equity in income (loss) of AMAK	$	59		$	(350	)

See our Annual Report on Form 10-K for the year ended December 31, 2014, for additional information.