Gulf Resources Provides Updates on its Rectification and Repairment Work
October 30 2018 - 9:00AM
Gulf Resources, Inc. (NASDAQ:GURE) ("Gulf Resources" or the
"Company"), a leading manufacturer of bromine, crude salt,
specialty chemical products, and natural gas in China, today
announces it has been working aggressively to complete the
rectification required by the government and to make all of the
repairs and rebuilding caused by Typhoon Winbiya in August in the
seven bromine factories that are expected to receive government
approval.
Gulf Resources believes most of the rectification issues related
to crude salt and bromine at the remaining factories are resolved.
While it still needs approvals for project approval, planning
approval, land use rights approval and environmental protection
assessment approval, the local government is actively working with
us.
The company had signed a contract with a third party to help
with the repair and rebuilding work for wells, brine water
reservoirs and aqueducts. Virtually every employee of Gulf
Resources, including senior management have been working together
to repair the rest of the damages caused by the recent floods.
The company believes the rectification and repair process will
require three additional months of work, largely because progress
is slower during the winter months due to the weather. As noted in
the second quarter conference call, the Company estimates the costs
of repairing and rebuilding due to the flood damages will be $8-10
million.
The company believes its factories will be fully operational
during the first quarter of 2019 if all approvals are obtained
after completion of the rectification process and repairs.
Based on the current analysis, the company believes that some of
the bromine production capacities in Shandong Province have
permanently closed as a result of the more stringent environmental
requirements. Bromine prices have continued to trend upward and are
currently at RMB 32,000. With the weakness of the RMB, imports have
become more expensive. Based on the reduced capacity and high
import cost, the company believes the price of bromine will remain
at high levels, which should enable the company to produce
excellent returns.
About Gulf Resources, Inc. Gulf Resources, Inc.
operates through three wholly-owned subsidiaries, Shouguang City
Haoyuan Chemical Company Limited ("SCHC"), Shouguang Yuxin 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 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, 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 risk 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 (NASDAQ:GURE)
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