Quarterly report pursuant to Section 13 or 15(d)

Equity Method Investment

v3.10.0.1
Equity Method Investment
9 Months Ended
Sep. 30, 2018
Equity Method Investment [Abstract]  
EQUITY METHOD INVESTMENT

NOTE 7 – EQUITY METHOD INVESTMENT

 

At September 30, 2018 and December 31, 2017, equity method investment amounted to $28,875,594 and $30,521,466, respectively. The investment represents the Company’s subsidiary, Pingtan Fishing’s interest in Global Deep Ocean. On June 12, 2014, Pingtan Fishing incorporated Global Deep Ocean with other two unrelated companies in PRC. In April 2017, these two companies sold their shares to another unrelated party, Zhen Lin. As of September 30, 2018, Pingtan Fishing and Zhen Lin accounted for 20% and 80% of the total ownership, respectively.

 

Global Deep Ocean will process, cold storage, and transport deep ocean fishing products. Total registered capital of Global Deep Ocean is RMB 1 billion (approximately $145.4 million) and as of September 30, 2018, Pingtan Fishing had contributed its share of registered capital of RMB 200 million (approximately $29.1 million).

 

The Company treats the equity investment in the consolidated financial statements under the equity method. Under the equity method, the investment is initially recorded at cost, adjusted for any excess of the Company’s share of the incorporated-date fair values of the investee’s identifiable net assets over the cost of the investment (if any). Thereafter, the investment is adjusted for the post incorporation change in the Company’s share of the investee’s net assets and any impairment loss relating to the investment. For the three months ended September 30, 2018 and 2017, the Company’s share of Global Deep Ocean’s net loss was $60,423 and $7,333, respectively, which was included in loss on equity method investment in the accompanying consolidated statements of operations and comprehensive income. For the nine months ended September 30, 2018 and 2017, the Company’s share of Global Deep Ocean’s net loss was $121,537 and $27,500, respectively, which was included in loss on equity method investment in the accompanying consolidated statements of operations and comprehensive income.

 

The tables below present the summarized financial information, as provided to the Company by the investee, for the unconsolidated company:

 

    September 30,
2018
    December 31,
2017
 
Current assets   $ 67,697,329     $ 49,372,645  
Noncurrent assets     10,211,580       6,974,590  
Current liabilities     2,534       151,312  
Noncurrent liabilities     25,104,663       -  
Equity     52,801,712       56,195,923  

 

    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2018     2017     2018     2017  
Net revenue   $ -     $ -     $ -     $ -  
Gross profit     -       -       -       -  
Loss from operation     302,113       36,666       607,686       137,398  
Net loss     302,113       36,667       607,686       137,501