INVESTMENT IN AMAK

9 Months Ended

Sep. 30, 2015

15. INVESTMENT IN AMAK

As of September 30, 2015, and December 31, 2014, the Company had a non-controlling equity interest (35%) of approximately $50.7 million and $53.0 million, respectively. Our investment is accounted for under the equity method.

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 September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(Thousands of Dollars)
Sales	$	19,874		$	16,957		$	38,458		$	47,655
Gross Profit (Loss)		(2,711	)		1,785			35			6,469
General, administrative and other expenses		4,067			3,714			9,605			11,285
Net Loss	$	(6,778	)	$	(1,929	)	$	(9,570	)	$	(4,816	)
Depreciation, depletion and amortization		4,235			5,930			15,250			16,744
Net Income (Loss) before depreciation, depletion and amortization	$	(2,543	)	$	4,001		$	5,680		$	11,928

Financial Position

	September 30,		December 31,
	2015		2014
	(Thousands of Dollars)
Current assets	$	31,904	$	17,782
Noncurrent assets		261,623		265,584
Total assets	$	293,527	$	283,366

Current liabilities	$	21,216	$	23,034
Long term liabilities		89,156		67,598
Shareholders' equity		183,155		192,734
	$	293,527	$	283,366

The equity in the income or loss of AMAK reflected on the consolidated statement of income for the three and nine months ended September 30, 2015, and 2014, is comprised of the following:

	Three months ended September 30,						Nine months ended September 30,
	2015			2014			2015			2014
	(Thousands of Dollars)
Company’s share of loss reported by AMAK	$	(2,391	)	$	(680	)	$	(3,375	)	$	(1,698	)
Amortization of difference between Company’s investment in AMAK and Company’s share of net assets of AMAK		337			337			1,011			1,011
Equity in loss of AMAK	$	( 2,054	)	$	(343	)	$	(2,364	)	$	(687	)

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