Gulf Resources, Inc. Announces Second Quarter 2025 Unaudited Financial Results
SHOUGUANG, China, Aug. 13, 2025 (GLOBE NEWSWIRE) -- Gulf Resources, Inc. (NASDAQ:GURE) ("Gulf Resources," "we," or the "Company"), a leading manufacturer of bromine, crude salt and specialty chemical products in China today announced its unaudited financial results for the three months ended June 30, 2025.
The company reported:
- Net Revenue increased by 250% to $8,343,785 from $2,383,169 in the previous year.
- Gross profits increased to $986,655 from a loss of $2,728,889.
- The loss from operations was $750,686 compared to a loss of $5,146,997.
- The net loss was $773,777 versus a net loss of $33,097,918 in the previous period.
- The Loss per share was $0.06 versus a loss of $3.09 in the previous period.
- Negative cash flow for the 6 months of 2025 was sharply reduced from $61,856,355 to $2,339,081.
On a segment basis
Bromine
- Bromine sales increased by 313% to $7,676,374 from $1,859,234.
- Volume increased by 152% to 1,972 tonnes from 782 tonnes.
- Cost of net revenue increased by 48% to $7,016,815 from $4,729,059 .
- Gross profit was $659,559 versus a loss of $2,869,825 in the previous period.
- Net loss for the quarter was $130,381 versus a net loss of $4,662,586 in the previous year.
Crude Salt
- Crude Salt revenues increased by 27% to $667,411 from $ 523,935.
- Volume increased by 4% to 25,934 tonnes from 24,852 tonnes.
- Cost of revenue declined by 11% to $340,315 from $382,999.
- Gross profit increased by 132% to $327,096 from $ 140,936.
- Net loss for the quarter was $147,489 versus a profit of $130,024 in the previous year.
Chemicals & Natural gas, neither of which was operational, combined lost $388,202 vs. a loss of $413,027 in the previous year.
Updates on Current Business
During the three months ended June 30, 2025, bromine pricing exhibited significant volatility. On March 31, 2025, the last day of the first quarter of 2025, the price of bromine was RMB 29,000 per tonne. By April 14, bromine had reached a price of RMB 37,500 per tonne. By May 14, the price of bromine had declined to RMB 23,100 per tonne. At the end of the second quarter, bromine was priced at RMB 24,686 per tonne. Since the end of the second quarter, bromine prices have increased consistently to RMB 29,200 per tonne on August 12. The Company anticipates that this price recovery, coupled with increasing overall demand, represents a potentially sustainable market trend. (Source: sunsirs.com)
The Company has initiated development activities on the crude salt fields acquired in the prior year. These assets are expected to enhance both salt and bromine production capacity and may facilitate the reopening of manufacturing facilities #2 and #10, which remain temporarily closed.
The chemicals segment operations remain suspended pending improved market conditions. Given the challenging profitability environment faced by many chemical manufacturers, management has elected to defer completion of the remaining chemical factory construction until market conditions present opportunities for sustainable profitability.
Natural gas operations also remain inactive while awaiting completion of provincial planning initiatives in Sichuan Province. Given China's increasing natural gas demand, the Company continues monitoring regulatory developments and evaluating potential joint venture opportunities in this sector.
Mr. Liu Xiaobin, the CEO and Chairman of Gulf Resources, stated, "We are becoming more optimistic about our business. We see signs of stabilization in the Chinese economy. Many of our competitors in bromine and crude salt have closed their factories. Demand is increasing as are prices. These conditions auger well for the third quarter and coming quarters. We should start to see benefits from the acquisition of the new salt fields."
"We continue to believe," Mr. Liu continued, "that we will find opportunities in chemicals and natural gas. However, right now, we are focused on generating profits and free cash flow from our bromine and crude salt segments, and confident that this will occur in the near future."
| GULF RESOURCES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Expressed in U.S. dollars) | ||||||||
| June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | |||||||
| Current Assets | ||||||||
| Cash | $ | 7,736,081 | $ | 10,075,162 | ||||
| Accounts receivable, net | 3,150,850 | 564,523 | ||||||
| Inventories, net | 515,013 | 315,371 | ||||||
| Prepayments and deposits | 8,743,324 | 6,376,656 | ||||||
| Amount due from related parties | 25,144 | 25,040 | ||||||
| Other receivable | 105,564 | 94,074 | ||||||
| Total Current Assets | 20,275,976 | 17,450,826 | ||||||
| Non-Current Assets | ||||||||
| Property, plant and equipment, net | 128,694,551 | 136,143,177 | ||||||
| Finance lease right-of use assets | 74,668 | 76,868 | ||||||
| Operating lease right-of-use assets | 5,937,515 | 6,169,855 | ||||||
| Prepaid land leases, net of current portion | 9,648,863 | 9,615,269 | ||||||
| Deferred tax assets, net | — | — | ||||||
| Total non-current assets | 144,355,597 | 152,005,169 | ||||||
| Total Assets | $ | 164,631,573 | $ | 169,455,995 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 11,551,878 | $ | 14,323,458 | ||||
| Taxes payable-current | 298,037 | 113,999 | ||||||
| Advance from customer | — | — | ||||||
| Amount due to related parties | 2,589,489 | 2,584,808 | ||||||
| Finance lease liability, current portion | 188,550 | 217,743 | ||||||
| Operating lease liabilities, current portion | 162,134 | 491,850 | ||||||
| Total Current Liabilities | 14,790,088 | 17,731,858 | ||||||
| Non-Current Liabilities | ||||||||
| Finance lease liability, net of current portion | 891,801 | 1,075,865 | ||||||
| Operating lease liabilities, net of current portion | 6,734,859 | 6,941,602 | ||||||
| Total Non-Current Liabilities | 7,626,660 | 8,017,467 | ||||||
| Total Liabilities | $ | 22,416,748 | $ | 25,749,325 | ||||
| Commitment and Loss Contingencies | $ | — | $ | — | ||||
| Stockholders' Equity | ||||||||
| PREFERRED STOCK; $0.001 par value; 1,000,000 shares authorized; none outstanding | $ | — | $ | — | ||||
| COMMON STOCK; $0.0005 par value; 80,000,000 shares authorized; 13,632,448 and 11,012,754 shares issued; and 13,346,618 and 10,726,924 shares outstanding as of June 30, 2025 and December 31, 2024 | 25,934 | 24,623 | ||||||
| Treasury stock; 285,830 shares as of June 30, 2025 and December 31, 2024 at cost | (1,372,673 | ) | (1,372,673 | ) | ||||
| Additional paid-in capital | 105,167,292 | 101,688,262 | ||||||
| Share to be issued | — | 194,700 | ||||||
| Retained earnings unappropriated | 31,955,527 | 37,358,804 | ||||||
| Retained earnings appropriated | 26,667,097 | 26,667,097 | ||||||
| Accumulated other comprehensive income | (20,228,352 | ) | (20,854,143 | ) | ||||
| Total Stockholders' Equity | 142,214,825 | 143,706,670 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 164,631,573 | $ | 169,455,995 | ||||
| GULF RESOURCES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (Expressed in U.S. dollars) (UNAUDITED) | ||||||||||||||||
| Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| NET REVENUE | $ | 8,343,785 | $ | 2,383,169 | $ | 9,948,232 | $ | 3,690,231 | ||||||||
| OPERATING COSTS AND EXPENSE | ||||||||||||||||
| Cost of net revenue | (7,357,130 | ) | (5,112,058 | ) | (8,951,400 | ) | (7,231,903 | ) | ||||||||
| Sales and marketing expenses | (14,802 | ) | (13,633 | ) | (19,855 | ) | (18,124 | ) | ||||||||
| Direct labor and factory overheads incurred during plant shutdown | (727,774 | ) | (1,714,503 | ) | (3,953,582 | ) | (5,449,192 | ) | ||||||||
| General and administrative expenses | (994,765 | ) | (689,972 | ) | (2,384,288 | ) | (1,407,428 | ) | ||||||||
| TOTAL OPERATING COSTS AND EXPENSE | (9,094,471 | ) | (7,530,166 | ) | (15,309,125 | ) | (14,106,647 | ) | ||||||||
| LOSS FROM OPERATIONS | (750,686 | ) | (5,146,997 | ) | (5,360,893 | ) | (10,416,416 | ) | ||||||||
| OTHER INCOME (EXPENSE) | ||||||||||||||||
| Interest expense | (21,674 | ) | (24,814 | ) | (43,396 | ) | (49,644 | ) | ||||||||
| Interest income | 1,795 | 34,791 | 4,224 | 70,851 | ||||||||||||
| Other expense, net | (3,212 | ) | — | (3,212 | ) | (4,003 | ) | |||||||||
| Loss on disposal of property, plant and equipment | — | (29,169,008 | ) | — | (29,169,008 | ) | ||||||||||
| Loss before taxes | (773,777 | ) | (34,306,028 | ) | (5,403,277 | ) | (39,568,220 | ) | ||||||||
| INCOME TAX BENEFIT (EXPENSE) | — | 1,208,110 | — | 2,478,170 | ||||||||||||
| NET LOSS | $ | (773,777 | ) | $ | (33,097,918 | ) | $ | (5,403,277 | ) | $ | (37,090,050 | ) | ||||
| COMPREHENSIVE LOSS | ||||||||||||||||
| NET LOSS | $ | (773,777 | ) | $ | (33,097,918 | ) | $ | (5,403,277 | ) | $ | (37,090,050 | ) | ||||
| - Foreign currency translation adjustments | 403,775 | (849,254 | ) | 625,791 | (1,243,121 | ) | ||||||||||
| TOTAL COMPREHENSIVE LOSS | $ | (370,002 | ) | $ | (33,947,172 | ) | $ | (4,777,486 | ) | $ | (38,333,171 | ) | ||||
| BASIC AND DILUTED LOSS PER SHARE: | $ | (0.06 | ) | $ | (3.09 | ) | $ | (0.43 | ) | $ | (3.46 | ) | ||||
| BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF SHARES: | 13,346,618 | 10,726,924 | 12,520,613 | 10,726,924 | ||||||||||||
| GULF RESOURCES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in U.S. dollars) (UNAUDITED) | ||||||||
| Six-Month Period Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net Loss | $ | (5,403,277 | ) | $ | (37,090,050 | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Amortization on capital lease | 43,396 | 49,644 | ||||||
| Depreciation and amortization | 7,997,410 | 9,467,311 | ||||||
| Deferred tax asset | — | (2,511,394 | ) | |||||
| Stock-based compensation expense | 196,100 | — | ||||||
| Amortization of right-of-use asset | 435,102 | 440,030 | ||||||
| Loss on disposal of equipment | — | 29,169,008 | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | (2,574,907 | ) | 3,108,788 | |||||
| Inventories | (197,631 | ) | 160,396 | |||||
| Prepayments and deposits | (2,331,871 | ) | 68,895 | |||||
| Advance from customers | — | (27,000 | ) | |||||
| Other receivables | (11,447 | ) | 4,854 | |||||
| Accounts and Other payable and accrued expenses | 268,175 | (2,583,610 | ) | |||||
| Amount due to related Parties | — | — | ||||||
| Taxes payable | 182,919 | (315,782 | ) | |||||
| Lease Liabilities | (743,404 | ) | (753,231 | ) | ||||
| Net cash used in operating activities | (2,139,435 | ) | (812,141 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Purchase of property, plant and equipment | — | (60,526,213 | ) | |||||
| Net cash provided by (used in) investing activities | — | (60,526,213 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Repayment of finance lease obligation | (260,997 | ) | (264,094 | ) | ||||
| Net cash used in financing activities | (260,997 | ) | (264,094 | ) | ||||
| EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | 61,351 | (253,907 | ) | |||||
| NET DECREASE IN CASH AND CASH EQUIVALENTS | (2,339,081 | ) | (61,856,355 | ) | ||||
| CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 10,075,162 | 72,223,894 | ||||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 7,736,081 | $ | 10,367,539 | ||||
| GULF RESOURCES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) (Expressed in U.S. dollars) | ||||||||
| Years Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||||||||
| Cash paid during the six-month period ended June 30, 2025 for: | ||||||||
| Paid for taxes | $ | 811,828 | $ | 886,928 | ||||
| Interest on finance lease obligation | $ | 43,396 | $ | 49,644 | ||||
| SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||||||||
About Gulf Resources, Inc.
Gulf Resources, Inc. operates through four wholly-owned subsidiaries, Shouguang City Haoyuan Chemical Company Limited ("SCHC"), Shouguang Yuxin Chemical Industry Co., Limited ("SYCI"), Daying County Haoyuan Chemical Company Limited ("DCHC") and Shouguang Hengde Salt Industry Co. Ltd. ("SHSI"). The Company believes that it is one of the largest producers of bromine in China. Elemental Bromine is used to manufacture a wide variety of compounds utilized in industry and agriculture. Through SYCI, the Company manufactures chemical products utilized in a variety of applications, including oil and gas field explorations and papermaking chemical agents, and materials for human and animal antibiotics. Through SHSI, the Company manufactures and sells crude salt. DCHC was established to further explore and develop natural gas and brine resources (including bromine and crude salt) in China. For more information, visit www.gulfresourcesinc.com.
Forward-Looking Statements
Certain statements in this news release contain forward-looking information about Gulf Resources and its subsidiaries business and products within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. The actual results may differ materially depending on a number of risk factors including, but not limited to, the general economic and business conditions in the PRC, the risks associated with the COVID-19 pandemic outbreak, future product development and production capabilities, shipments to end customers, market acceptance of new and existing products, additional competition from existing and new competitors for bromine and other oilfield and power production chemicals, changes in technology, the ability to make future bromine asset purchases, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in the Company's reports filed with the Securities and Exchange Commission. Gulf Resources undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.
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