Notes Five: JOINT VENTURESInvestments, advances
and equity in undistributed earnings of
joint ventures were as
follows at November 30:
| (In thousands) |
2004 |
2003 |
|
| Investments -- equity method |
$ 16,042 |
$ 13,064 |
| Investments -- cost method |
5,922 |
5,479 |
| |
|
| |
$ 21,964 |
$ 18,543 |
|
|
The Company's
ownership of joint ventures is summarized below:
| Products |
Joint Ventures |
Ownership
Interest |
|
| Coatings |
Oasis-Ameron, Ltd. |
40% |
| Fiberglass pipe |
Bondstrand, Ltd. |
40% |
| Concrete pipe |
Ameron Saudi Arabia, Ltd. ("ASAL") |
30% |
| Steel products |
TAMCO |
50% |
Investments in joint
ventures and the amount of undistributed earnings were as
follows:
| (In thousands) |
Coatings |
Fiberglass
pipe |
Concrete
pipe |
Steel
products |
Total |
|
| Cost |
$ 2,138 |
$ 3,784 |
$ - |
$ 8,482 |
$ 14,404 |
| Comprehensive loss from joint venture |
- |
- |
- |
(1,178) |
(1,178) |
| Accumulated equity in undistributed earnings, net of reserves |
- |
- |
- |
8,738 |
8,738 |
| |
|
| Investment, November 30, 2004 |
$ 2,138 |
$ 3,784 |
$ - |
$16,042 |
$ 21,964 |
| |
|
| Dividends received in 2004 |
$ 506 |
$ - |
$ - |
$ 9,860 |
$ 10,186 |
|
Cost |
$ 1,695 |
$ 3,784 |
$
- |
$ 8,482 |
$ 13,961 |
Comprehensive loss from joint venture |
- |
- |
- |
(1,941) |
(1,941) |
| Accumulated equity in undistributed
earnings, net of reserves |
- |
- |
-
|
6,523 |
6,523 |
| |
|
Investment, November 30, 2003 |
$ 1,695 |
$3,784 |
$ - |
$13,064 |
$ 18,543 |
| |
|
Dividends received in 2003 |
$ 636 |
$ 3,042 |
$ 2,633 |
$ 1,276 |
$ 7,587 |
|
|
In 2003, the Company sold its 25% ownership of Amercoat Mexicana for
a pretax gain of $2,477,000. Income from Amercoat Mexicana totaled $312,000
and $327,000 in the years ended November 30, 2003, and 2002, respectively.
The Company provides for income taxes on the undistributed earnings of
its joint ventures to the extent such earnings are included in the consolidated
statements of income. The investment in TAMCO was recorded based on audited
financial statements as of November 30, 2004. Condensed financial data
of TAMCO, an investment which is accounted for
under the equity method,were as follows:
| Financial Condition |
| (In thousands) |
2004 |
2003 |
|
| Current assets |
$ 66,494 |
$ 39,412 |
| Noncurrent assets |
27,943 |
30,862 |
| |
|
|
| |
$ 94,437 |
$ 70,274 |
| |
|
|
| Current liabilities |
$ 38,119 |
$ 17,598 |
| Noncurrent liabilities |
8,603 |
10,808 |
| Stockholders' equity |
47,715 |
41,868 |
| |
|
|
| |
$ 94,437 |
$ 70,274 |
|
|
|
| Results of Operations |
| (In thousands) |
2004 |
2003 |
2002 |
|
| Net sales |
$215,849 |
$163,277 |
$ 130,893 |
| Gross profit |
45,885 |
8,658 |
21,924 |
| Net income |
23,427 |
1,333 |
6,745 |
|
|
In 2001, TAMCO entered into a swap agreement intended to hedge
expected cash flows related to the purchase of natural gas used in its
manufacturing process. The Company recognized $1,178,000 and
$1,941,000 in accumulated other comprehensive loss at November 30,
2004 and 2003, respectively, which represents its proportionate share
of amounts recognized by TAMCO to record the fair value of the swap
agreement.
Sales to joint ventures totaled $1,613,000 in 2004, $4,004,000 in 2003,
and $4,848,000 in 2002.
|
