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Segment Information
 12 Months Ended
Dec. 31, 2013
Schedule of Segment Reporting (Tables)  
Segment Information

7.

Segment Information

 

The Company and its subsidiaries operate in the business of pigment manufacturing and related products in three geographic segments.  All United States manufacturing is done at the facility located in Corpus Christi, Texas.  Foreign manufacturing is done by the Company’s wholly-owned foreign operations, TMM, located in Malaysia and TPT, located in The Netherlands.

 

Product sales of inventory between the U.S., Asian and European operations are based on inter-company pricing, which includes an inter-company profit margin.  In the geographic information, the location profit (loss) from all locations is reflective of these inter-company prices, as is inventory at the Corpus Christi location prior to elimination adjustments.  Such presentation is consistent with the internal reporting reviewed by the Company’s chief operating decision maker.  The elimination entries include an adjustment to the cost of sales resulting from the adjustment to ending inventory to eliminate inter-company profit, and the reversal of a similar adjustment from a prior period.  To the extent there are net increases/declines period over period in Corpus Christi inventories that include an inter-company component, the net effect of these adjustments can decrease/increase location profit.

 

For the year ended December 31, 2013, the U.S. operations received approximately 30% of its total third party sales revenue from a single customer.  The European operations received approximately 31% of its total third party sales revenue from two customers (18% and 13%), and the Asian operations received approximately 42% of its total third party sales revenue from a single customer.  One customer represented approximately 20% of the 2013 total consolidated sales.

 

For the year ended December 31, 2012, the U.S. operations received approximately 29% of its total third party sales revenue from a single customer.  The European operations received approximately 10% of its total third party sales revenue from one customer, and the Asian operations received approximately 57% of its total third party sales revenue from a single customer.  Two customers represented approximately 17% and 16%, respectively, of the 2012 total consolidated sales.

 

Sales from the subsidiary to the parent company are based upon profit margins which represent competitive pricing of similar products.  Intercompany sales consisted of SR, HITOX, ALUPREM and TIOPREM.

 

The Company's principal product, HITOX, accounted for approximately 30% and 33% of net consolidated sales in 2013 and 2012, respectively.

 

The Company sells its products to customers located in more than 60 countries.  Sales to external customers are attributed to geographic area based on country of distribution.  Sales to customers located in the U.S. represented approximately 56%, and 48% for the years ended December 31, 2013 and 2012, respectively.

 

For the year ended December 31, 2013, sales to customers in Germany represented approximately 20% of our total foreign sales and the United Kingdom represented approximately 33% in 2012.

 

Approximately 24% of the Company's employees are represented by an in-house collective bargaining agreement.

 

A summary of the Company’s manufacturing operations by geographic segment is presented below:

 

 

(In thousands)

 

United States(Corpus Christi)

 

Netherlands(TPT)

 

Malaysia(TMM)

 

Inter-CompanyEliminations

 

Consolidated

As of and for the years ended:

 

 

 

 

 

 

 

 

 

 

December 31, 2013

 

 

 

 

 

 

 

 

 

 

Net Sales:

 

 

 

 

 

 

 

 

 

 

Customer sales

$

30,019 

$

8,255 

$

7,747 

$

- 

$

46,021 

Intercompany sales

 

110 

 

6,627 

 

7,638 

 

(14,375)

 

- 

Total Net Sales

$

30,129 

$

14,882 

$

15,385 

$

(14,375)

$

46,021 

Share based compensation

$

109 

$

- 

$

- 

$

- 

$

109 

Depreciation

$

936 

$

1,197 

$

1,024 

$

- 

$

3,157 

Interest expense

$

77 

$

97 

$

215 

$

- 

$

389 

Income tax (benefit) expense

$

(511)

$

265 

$

(587)

$

9 

$

(824)

Location profit (loss)

$

(1,132)

$

826 

$

(1,347)

$

37 

$

(1,616)

Capital expenditures

$

703 

$

1,192 

$

2,335 

$

- 

$

4,230 

Location long-lived assets

$

5,805 

$

8,965 

$

9,029 

$

- 

$

23,799 

Location assets

$

17,956 

$

10,995 

$

23,666 

$

- 

$

52,617 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2012

 

 

 

 

 

 

 

 

 

 

Net Sales:

 

 

 

 

 

 

 

 

 

 

Customer sales

$

33,263 

$

7,578 

$

15,812 

$

- 

$

56,653 

Intercompany sales

 

105 

 

6,179 

 

9,064 

 

(15,348)

 

- 

Total Net Sales

$

33,368 

$

13,757 

$

24,876 

$

(15,348)

$

56,653 

Share based compensation

$

90 

$

- 

$

- 

$

- 

$

90 

Depreciation

$

751 

$

871 

$

848 

$

- 

$

2,470 

Interest expense

$

170 

$

126 

$

175 

$

- 

$

471 

Income tax expense

$

753 

$

133 

$

204 

$

(66)

$

1,024 

Location profit

$

2,076 

$

445 

$

2,738 

$

(231)

$

5,028 

Capital expenditures

$

1,928 

$

1,581 

$

1,372 

$

- 

$

4,881 

Location long-lived assets

$

6,051 

$

8,653 

$

8,229 

$

- 

$

22,933 

Location assets

$

20,762 

$

10,652 

$

23,032 

$

- 

$

54,446