Investments in affiliates

12 Months Ended

Dec. 31, 2023

Investments in affiliates

Investments in affiliates

Note 9: Investments in affiliates

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

	December 31,
	2023			2022
Zhejiang Tianlan Environmental Protection Technology Co. Ltd.
Interest held		19.4	%		19.4	%
	US$’000			US$’000
Long-term investment, at cost, less impairment		5,540			5,540
Share of undistributed profits		4,316			2,711
		9,856			8,251

Far East is holding 19.4% (2022: 19.4%) equity interests in Blue Sky, a company incorporated in the PRC, with total cost of investment of US$5,540,000. Blue Sky provides a comprehensive service for design, general contract, equipment manufacturing, installation, testing and operation management of the treatment of waste gases emitted from various boilers and industrial furnaces of power plants, steel works and chemical plants since 2000.

Blue Sky has listed its shares on the New Third Board in the PRC since November 17, 2015 and suspended trading from August 15, 2017 and resumed trading on February 2, 2018 and suspended trading from November 24, 2020 and resumed trading on January 6, 2021.

The Group’s interest in Blue Sky has been counted for as an affiliate using the equity method as the Group has representation on both the Board and Executive Committee of Blue Sky, and the ability to participate in the decision-making process and exercise significant influence.

A summary of the financial information of the affiliate, Blue Sky, is set forth below:

	December 31,
	2023			2022
Balance Sheet:	US$’000			US$’000
Current assets		51,683			54,228
Non-current assets		10,909			13,167
Total assets		62,592			67,395
Total liabilities		(26,374	)		(38,582	)
Total shareholders’ equity		36,218			28,813

	Year ended December 31,
	2023		2022
Operating results:	US$’000		US$’000
Net sales		38,530		59,983
Operating income		337		1,175
Net income		9,978		2,346