SHOUGUANG, China, May 13, 2022 (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 financial results for the first quarter ended March 31, 2022 as well as its plan to provide investors with its 6 year financial plan by the end of June 2022.
First Quarter 2022
Business Segment DataBromine
Crude Salt
Chemicals
Natural Gas
Balance Sheet
Cash Flow
Subsequent Event
“We were very pleased with our quarter,” stated Mr. Liu Xiaobin, the CEO of Gulf Resources. “Although our factories were closed for 51 of the 90 days and although we required time to restart them, our bromine business still generated over $8 million in revenues and $4 million in gross profit. Bromine pricing has remained extremely strong. Imports have become more expensive. Capacity in China has been reduced, because of environmental controls, and demand remains strong. We are seeing increased use of bromine in pharmaceuticals and other products, such as zinc-bromine batteries. We also expect to receive permission for at least one of our closed factories in 2022. We are extremely bullish on the opportunity in this sector. Based on the improvements we have made to increase productivity and our current outlook on pricing. We will be providing investors with our 6-year plan by the end of June 2022.”
“Results in our crude salt business should improve as the weather warms,” Mr. Liu continued. “We are very optimistic about the opportunities for our new Yuxin chemical business. We are planning to finish construction and begin test and trial production, and we may begin commercial production during 2023.”
“We are also optimistic that we will receive permission to drill for natural gas and brine in Sichuan Province. China faces great shortages of natural gas and we hope to be part of the solution.”
“Finally,” Mr. Liu concluded, “Our management has been working diligently to complete our 6-year plan, which we have promised investors. Our plan will include detailed projections through 2027. We believe investors will be encouraged when they review our projections. Our plan is to hold a conference call by the end of the next month where we will review these projections with our investors.”(*These calculations are based on the number of shares issued of 10,517,754 shares as of March 31, 2022)
Conference CallGulf Resources management will host a conference call on Monday, May 16, 2022 at 08:30 AM ET to discuss financial results for the first quarter 2022.Mr. Xiaobin Liu, CEO of Gulf Resources, will be hosting the call. The Company management team will be available for investor questions following the prepared remarks. To participate in this live conference call, please dial Toll Free +1 (888) 506-0062 five to ten minutes prior to the scheduled conference call time. International callers should dial +1 (973) 528-0011, and please reference to “Gulf Resources” or Participant Access Code: 448480 while dial in.The webcasting is also available then, just simply click on the link below:http://www.gulfresourcesinc.com/news-28.html
A replay of the conference call will be available two hours after the call's completion and expired by Wednesday, May 23, 2022. To access the replay, call +1 (877) 481-4010. International callers should call +1 (919) 882-2331. The Replay Passcode is 45597.
About Gulf Resources, Inc.Gulf Resources, Inc. operates through three wholly-owned subsidiaries, Shouguang City Haoyuan Chemical Company Limited ("SCHC"), ShouguangYuxin Chemical Industry Co., Limited ("SYCI"), and Daying County Haoyuan Chemical Company Limited (“DCHC”). 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. 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 StatementsCertain 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.CONTACT: Gulf Resources, Inc.
Web: | http://www.gulfresourcesinc.com |
Director of Investor Relations | |
Helen Xu (Haiyan Xu) | |
beishengrong@vip.163.com |
GULF RESOURCES, INC. |
AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(Expressed in U.S. dollars) |
March 31, 2022(Unaudited) | December 31, 2021(Audited) | ||||||
Current Assets | |||||||
Cash | $ | 105,661,999 | $ | 95,767,263 | |||
Accounts receivable | 11,102,039 | 14,525,807 | |||||
Inventories, net | 515,562 | 691,111 | |||||
Prepayments and deposits | 4,904,466 | 4,450,037 | |||||
Other receivable | 644 | 644 | |||||
Total Current Assets | 122,184,710 | 115,434,862 | |||||
Non-Current Assets | |||||||
Property, plant and equipment, net | 182,415,845 | 162,657,546 | |||||
Finance lease right-of use assets | 184,155 | 184,824 | |||||
Operating lease right-of-use assets | 9,562,685 | 8,311,127 | |||||
Prepaid land leases, net of current portion | 10,419,032 | 10,368,469 | |||||
Deferred tax assets | 12,896,492 | 12,900,034 | |||||
Total non-current assets | 215,478,209 | 194,422,000 | |||||
Total Assets | $ | 337,662,919 | $ | 309,856,862 | |||
Liabilities and Stockholders’ Equity | |||||||
Current Liabilities | |||||||
Payable and accrued expenses | $ | 35,036,051 | $ | 10,530,776 | |||
Taxes payable-current | 1,472,666 | 775,708 | |||||
Amount due to a related party | 1,854,380 | 1,849,044 | |||||
Finance lease liability, current portion | 262,033 | 227,429 | |||||
Operating lease liabilities, current portion | 481,540 | 506,579 | |||||
Total Current Liabilities | 39,106,670 | 13,889,536 | |||||
Non-Current Liabilities | |||||||
Finance lease liability, net of current portion | 1,778,089 | 1,770,526 | |||||
Operating lease liabilities, net of current portion | 8,709,855 | 7,557,583 | |||||
Total Non-Current Liabilities | 10,487,944 | 9,328,109 | |||||
Total Liabilities | $ | 49,594,614 | $ | 23,217,645 | |||
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; 10,517,754 shares issued; and 10,471,924 shares outstanding as of March 31 31, 2022 and December 31, 2021 | 24,376 | 24,376 | |||||
Treasury stock; 45,830 shares as of March 31, 2022 and December 31, 2021 at cost | (510,329 | ) | (510,329 | ) | |||
Additional paid-in capital | 100,569,159 | 100,569,159 | |||||
Retained earnings unappropriated | 150,343,692 | 150,463,638 | |||||
Retained earnings appropriated | 24,233,544 | 24,233,544 | |||||
Accumulated other comprehensive income | 13,407,863 | 11,858,829 | |||||
Total Stockholders’ Equity | 288,068,305 | 286,639,217 | |||||
Total Liabilities and Stockholders’ Equity | $ | 337,662,919 | $ | 309,856,862 | |||
See accompanying notes to the condensed consolidated financial statements.
GULF RESOURCES, INC.AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)(Expressed in U.S. dollars)(UNAUDITED)
Three-Month Period EndedMarch 31, | |||||||
2022 | 2021 | ||||||
NET REVENUE | |||||||
Net revenue | $ | 8,930,737 | $ | 5,259,243 | |||
Direct labor and factory overheads incurred during plant shutdown | (2,184,591 | ) | (2,613,483 | ) | |||
General and administrative expenses | (2,242,501 | ) | (1,736,250 | ) | |||
Other operating expense | (8,404 | ) | — | ||||
(8,995,824 | ) | (8,540,667 | ) | ||||
LOSS FROM OPERATIONS | (65,087 | ) | (3,281,424 | ) | |||
OTHER INCOME (EXPENSE) | |||||||
Interest expense | (34,692 | ) | (36,862 | ) | |||
Interest income | 75,528 | 72,453 | |||||
LOSS BEFORE TAXES | (24,251 | ) | (3,245,833 | ) | |||
INCOME TAX BENEFIT | (95,695 | ) | 743,709 | ||||
NET LOSS | $ | (119,946 | ) | $ | (2,502,124 | ) | |
COMPREHENSIVE LOSS: | |||||||
NET LOSS | $ | (119,946 | ) | $ | (2,502,124 | ) | |
OTHER COMPREHENSIVE LOSS | |||||||
- Foreign currency translation adjustments | 1,549,034 | (2,184,690 | ) | ||||
COMPREHENSIVE INCOME (LOSS) | $ | 1,429,088 | $ | (4,686,814 | ) | ||
LOSS PER SHARE: | |||||||
BASIC AND DILUTED | $ | (0.01 | ) | $ | (0.25 | ) | |
WEIGHTED AVERAGE NUMBER OF SHARES: | |||||||
BASIC AND DILUTED | 10,471,924 | 9,997,477 | |||||
See accompanying notes to the condensed consolidated financial statements.
GULF RESOURCES, INC. |
AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
(Expressed in U.S. dollars) |
(UNAUDITED) |
Three-Month Period Ended March 31, | |||||||
2022 | 2021 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net loss | $ | (119,946 | ) | $ | (2,502,124 | ) | |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
Interest on capital lease obligation | 33,622 | 35,538 | |||||
Depreciation and amortization | 5,003,078 | 4,104,357 | |||||
Unrealized exchange (gain) loss on translation of inter-company balances | 283,789 | 104,812 | |||||
Deferred tax asset | 95,695 | (743,709 | ) | ||||
Common stock issued for services | — | — | |||||
Changes in assets and liabilities | |||||||
Accounts receivable | 3,483,711 | 1,637,800 | |||||
Inventories | 178,444 | (162,099 | ) | ||||
Prepayments and deposits | (446,365 | ) | (71,888 | ) | |||
Other receivables | — | — | |||||
Accounts and Other payable and accrued expenses | 487,228 | 830,751 | |||||
Retention payable | — | — | |||||
Taxes payable | 704,492 | 72,758 | |||||
Prepaid land leases | — | — | |||||
Operating leases | (1,258,066 | ) | 35,199 | ||||
Net cash provided by operating activities | 8,445,682 | 3,341,395 | |||||
CASH FLOWS USED IN INVESTING ACTIVITIES | |||||||
Purchase of property, plant and equipment | (395,060 | ) | — | ||||
Net cash used in investing activities | (395,060 | ) | — | ||||
EFFECTS OF EXCHANGE RATE CHANGESON CASH AND CASH EQUIVALENTS | 1,844,114 | (864,609 | ) | ||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | 9,894,736 | 2,476,786 | |||||
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 95,767,263 | 94,222,538 | |||||
CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 105,661,999 | $ | 96,699,324 | |||
See accompanying notes to the condensed consolidated financial statements.
Source: Gulf Resources, Inc.