Quarterly report pursuant to Section 13 or 15(d)

Note 11 - Income Taxes

Note 11 - Income Taxes

6 Months Ended

Jun. 30, 2017

Income Taxes

The Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates, to determine its quarterly provision for income taxes.

The Company had income tax expenses of

$66,000

and

$147,000

for continuing operations for the

three

and

six

months ended

June 30, 2017,

respectively, and income tax benefits of

$3,167,000

and

$3,130,000

for continuing operations for the

three

and

six

months ended

June 30, 2016,

respectively. The Company’s effective tax rates were approximately

5.7%

and

8.4%

for the

three

and

six

months ended

June 30, 2017,

respectively, and (

28.0%

) and (

20.7%

) for the

three

and

six

months ended

June 30, 2016,

respectively.

The Company’s income tax benefits for the

three

and

six

months ended

June 30, 2016

was primarily the result of a tax benefit recorded in the amount of

$3,203,000

resulting from the permit impairment loss recorded for the Company’s M&EC subsidiary.