10. Interests in affiliates

12 Months Ended

Dec. 31, 2014

Notes to Financial Statements

Interests in affiliates

Investments in affiliates are accounted for using the equity method of accounting.

The Group acquired 20% equity interests in Zhejiang Tianlan Environmental Protection Technology Co. Ltd, (“Tianlan”), a company incorporated in the PRC for a total consideration of US$4,648,000 in 2007. In 2010, Tianlan increased its share capital and the Group further invested US$262,000 in order to maintain the share holding of 20% in Tianlan. In 2011, Tianlan increased its share capital and the Group further invested US$435,000 in order to maintain the share holding of 20% in Tianlan.

A summary of the financial information of the affiliate, Zhejiang Tianlan Environmental Protection Technology Co. Ltd, is set forth below:

	2014			2013
Balance Sheet:	US$’000			US$’000
Current assets		63,750			55,742
Non-current assets		17,659			9,733
Total assets		81,409			65,475
Total liabilities		(54,543	)		(40,672	)
		-----------			-----------
Total shareholders’ equity		26,866			24,803

	2014		2013
Operating results:	US$’000		US$’000
Net sales		76,723		61,997
Operating income		4,362		833
Net income		3,700		1,248

The Group acquired 20% of the equity interests in Zhejiang Jia Huan Electronic Co. Ltd., (“Jia Huan”), a company incorporated in the PRC, for approximately US$2,610,000 in 2008. Jia Huan has been in the environmental protection business since 1969 and is based in Jin Hua, Zhejiang.

A summary of the financial information of the affiliate, Zhejiang Jia Huan Electronic Co. Ltd, is set forth below:

	2014			2013
Balance Sheet:	US$’000			US$’000
Current assets		21,264			20,556
Non-current assets		5,288			5,635
Total assets		26,552			26,191
Total liabilities		(12,675	)		(12,623	)
Total shareholders’ equity		13,877			13,568

	2014		2013
Operating results:	US$’000		US$’000
Net sales		16,162		14,672
Operating income		1,024		545
Net income		762		377