SEC Company Response from ELAMEX SA DE CV (CIK 0001009302) — Oct 31, 2005
ELAMEX SA DE CV (CIK 0001009302)
Date: Oct. 31, 2005 · CIK: 0001009302 · Accession: 0001140361-05-008797
AI Filing Summary & Sentiment
File numbers found in text: 000-27992
Letter
United States Securities and Exchange Commission Division of Corporation Finance Elamex, S.A. de C.V. (the “Company”) 10-K for the fiscal year ended December 31, 2004 10-Q for the quarterly period ended March 31, 2005 File No. 000-27992 (the "Comment Letter")
Dear Ms. Di Silvio:
Following is our response to your Comment Letter of October 17, 2005. In order to facilitate your review, we have repeated each of your numbered comments in bold italics followed immediately by our response to that particular comment.
Form 10-K for the fiscal year ended December 31, 2004
Financial Statements
Consolidated Statements of Operations and Comprehensive Loss, Page
1.
We note you will amend your Form 1O-K to provide separate audited financial statements of Qualcore as of and for the year ended December 31,2004 in response to comment 1 of our letter dated August 10,2005. Please confirm that the significant subsidiary test under Rule 3-09 of Regulation S-X was evaluated for each of the years presented in your determination that audited statements were required only for 2004. See paragraph (b) of Rule 3-09 of Regulation S-X.
Response:
The Company confirms that it will amend its filing on Form 10-K/A to provide separate audited financial statements of Qualcore as of and for the year ended December 31, 2004.
The historical results of Elamex and Qualcore indicate that the JV investment was not significant according to Rule 3-09 as follows:
The results of the investment test at December 31, 2004, 2003 and 2002 were 0 %, 1 % and 2 %, respectively. The results of the income test for the years ended December 31, 2004, 2003 and 2002 were 35.1%, 6.2% and 19.6%, respectively. Please see Exhibit 1.
If you have questions or require additional information you may contact me at (915) 298-3071 or Dan Rabun of Baker & McKenzie LLP at (214) 978-3018.
Sincerely,
Sam
L.
Henry
Show Raw Text
CORRESP
1
filename1.htm
Elamex Correspondence 10-31-2005
Elamex
1800
Northwestern Dr. El Paso, TX 79912
October
31, 2005
Donna
Di
Silvio
Staff
Accountant
Michael
Moran
Branch
Chief
United
States Securities and Exchange Commission
Division
of Corporation Finance
Stop
3561
450
Fifth
Street, N.W.
Washington,
D.C. 20549-0405
RE:
Elamex,
S.A. de C.V. (the “Company”)
10-K
for
the fiscal year ended December 31, 2004
10-Q
for
the quarterly period ended March 31, 2005
File
No.
000-27992 (the "Comment
Letter")
Dear
Ms.
Di Silvio:
Following
is our response to your Comment Letter of October 17, 2005. In order to
facilitate your review, we have repeated each of your numbered comments in
bold
italics followed immediately by our response to that particular
comment.
Form
10-K for the fiscal year ended December 31, 2004
Financial
Statements
Consolidated
Statements of Operations and Comprehensive Loss, Page
24
1.
We
note you will amend your Form 1O-K to provide separate audited financial
statements of Qualcore as of and for the year ended December 31,2004
in
response to comment 1 of our letter dated August 10,2005. Please
confirm
that the significant subsidiary test under Rule 3-09 of Regulation
S-X was
evaluated for each of the years presented in your determination that
audited statements were required only for 2004. See paragraph (b)
of Rule
3-09 of Regulation
S-X.
Response:
The
Company confirms that it will amend its filing on Form 10-K/A to provide
separate audited financial statements of Qualcore as of and for the year ended
December 31, 2004.
The
historical results of Elamex and Qualcore indicate that the JV investment was
not significant according to Rule 3-09 as follows:
The
results of the investment test at December 31, 2004, 2003 and 2002 were 0 %,
1 %
and 2 %, respectively. The results of the income test for the years ended
December 31, 2004, 2003 and 2002 were 35.1%, 6.2% and 19.6%, respectively.
Please see Exhibit 1.
If
you
have questions or require additional information you may contact me at (915)
298-3071 or Dan Rabun of Baker & McKenzie LLP at (214)
978-3018.
Sincerely,
Sam
L.
Henry
Senior
Vice-President and Chief Financial Officer
Exhibit
1
Tests
related to the significance of our 50.01% owned equity method investee Qualcore
S. de R.L. de C.V. according
to Rule 3-09 of
Regulation S-X as of December 31, 2004, 2003 and 2002 and for each of the three
years in the period ended December 31, 2004:
The
following summarizes the revised computations to determine if Qualcore meets
the
conditions required to define a significant subsidiary.
1)
The
registrant's and its other subsidiaries' investments in and advances
to
the subsidiary exceed 20 percent of the total assets of the registrant
and
its subsidiaries consolidated as of the end of the most recently
completed
fiscal year.
AS
OF DECEMBER 31,
(In
thousands of U.S. dollars)
2004
2003
2002
Registrant's
total assets
54,250
67,403
134,501
Investment
and loans to unconsolidated joint venture
-
864
2,669
Investment
in JV as a percentage of registrant's total assets
0%
1%
2%
2)
The
registrant's and its other subsidiaries' proportionate share of the
total
assets (after inter-company eliminations) of the subsidiary exceeds
20
percent of the total assets of the registrant and its subsidiaries
consolidated as of the end of the most recently completed fiscal
year.
Not
applicable for this case
3)
The
registrant's and its other subsidiaries' equity in the income from
continuing operations before income taxes, extraordinary items and
cumulative effect of a change in accounting principle of the subsidiary
exceeds 20 percent of such income of the registrant and its subsidiaries
consolidated for the most recently completed fiscal
year.
Computational
note: For purposes of making the prescribed income test the following guidance
should be applied:
1.
When
a loss has been incurred by either the parent and its subsidiaries
consolidated or the tested subsidiary, but not both, the equity
in the
income or loss of the tested subsidiary should be excluded from
the income
of the registrant and its subsidiaries consolidated for purposes
of the
computation.
This
is
not applicable as both entities had losses in fiscal 2004.
2.
If
income of the registrant and its subsidiaries consolidated for
the most
recent fiscal year is at least 10 percent lower than the average
of the
income for the last five fiscal years, such average income should
be
substituted for purposes of the computation. Any loss years should
be
omitted for purposes of computing average
income.
This
is
not applicable as both entities had losses in fiscal 2004.
3.
Where
the test involves combined entities, as in the case of determining
whether
summarized financial data should be presented, entities reporting
losses
shall not be aggregated with entities reporting
income.
This
is
not applicable as the test does not involve combined entities.
AS
OF AND FOR THE YEARS ENDED DECEMBER 31,
(In
thousands of U.S. dollars)
2004
2003
2002
Loss
before income taxes, equity in losses of unconsolidated joint venture
and
cumulative effect of change in accounting principle
(2,366
)
(30,082
)
(4,600
)
Equity
in losses of unconsolidated affiliate, net of tax
(1,408
)
(2,107
)
(1,125
)
Registrant's
loss before income taxes and cumulative effect of change in accounting
principle
(3,774
)
(32,189
)
(5,725
)
Qualcore
loss before income taxes and cumulative effect of change in accounting
principle
(2,650
)
(3,958
)
(2,249
)
50.01%
of loss
(1,325
)
(1,980
)
(1,125
)
Qualcore's
loss as a percentage of registrant's loss
35.1
%
6.2
%
19.6
%