Ecovyst, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Investments in Affiliated Companies

Investments in Affiliated Companies

9 Months Ended

Sep. 30, 2019

Equity Method Investments and Joint Ventures [Abstract]

10. Investments in Affiliated Companies:

The Company accounts for investments in affiliated companies under the equity method. Affiliated companies accounted for on the equity basis as of September 30, 2019 are as follows:



Company	Country	Percent Ownership
PQ Silicates Ltd.	Taiwan	50%
Zeolyst International	USA	50%
Zeolyst C.V.	Netherlands	50%
Quaker Holdings	South Africa	49%
Asociacion para el Estudio de las Tecnologias de Equipamiento de Carreteras, S.A. (“Aetec”)	Spain	20%

Following is summarized information of the combined investments⁽¹⁾:



	Three months ended September 30,				Nine months ended September 30,
	2019		2018		2019		2018
Sales	$	121,471	$	74,088	$	279,503	$	271,562
Gross profit	48,416		24,495		102,966		100,686
Operating income	37,958		14,594		74,217		72,257
Net income	37,852		14,545		75,002		72,204


⁽¹⁾	Summarized information of the combined investments is presented at 100%; the Company’s share of the net assets and net income of affiliates is calculated based on the percent ownership specified in the table above.

The Company’s investments in affiliated companies balance as of September 30, 2019 and December 31, 2018 includes net purchase accounting fair value adjustments of $252,190 and $258,066, respectively, related to the series of transactions consummated on May 4, 2016 to reorganize and combine the businesses of PQ Holdings Inc. and Eco Services Operations LLC, consisting primarily of goodwill and intangible assets such as customer relationships, technical know-how and trade names. Consolidated equity in net income from affiliates is net of $1,658 and $5,875 of amortization expense related to purchase accounting fair value adjustments for the three and nine months ended September 30, 2019, respectively. Consolidated equity in net income from affiliates is net of $1,658 and $4,975 of amortization expense related to purchase accounting fair value adjustments for the three and nine months ended September 30, 2018, respectively.