Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act 1934

Date of Report (date of earliest event reported): November 19, 2024

Gulf Resources, Inc.

(Exact name of registrant as specified in charter)

Nevada

(State or other jurisdiction of incorporation)

000-20936

(Commission File Number)

13-3637458

(IRS Employer Identification No.)

Level 11,Vegetable Building, Industrial Park of the East City,

Shouguang City, Shandong, China 262700

(Address of principal executive offices and zip code)

+86 (536) 567 0008

(Registrant's telephone number including area code)

(Registrant's former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0005 par value		GURE		NASDAQ Global Select Market

Item 2.02

Results of Operations and Financial Condition.

On November 19, 2024, Gulf Resources, Inc. (the “Company”) issued a press release announcing its third quarter and nine months ended September 30, 2023 unaudited financial results. The full text of the press release is set forth in Exhibit 99.1 attached hereto.

As provided in General Instruction B.2 of SEC Form 8-K, such information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or under the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to this Current Report on Form 8-K.

Item 9.01

Financial Statements and Exhibits.

Exhibits

	99.1	Press Release of Gulf Resources, Inc. dated November 19, 2024.
	104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

GULF RESOURCES, INC.

By:	/s/ Min Li
Name:	Min Li
Title:	Chief Financial Officer

Dated: November 19, 2024

Gulf Resources Announces Third Quarter and Nine Months 2024 Unaudited Financial Results

SHOUGUANG, China, Nov. 19, 2024 (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 nine and three months ended September 30, 2024.

Three Months ended September 30, 2024:

•	Revenues for the third quarter were $2,242,365, a decline of 61.8% compared to the same period of 2023.

•	The net loss was $3,492,883, and the basic and diluted loss was $0.33 per share.

•	During the third quarter, bromine revenues declined by 68% to $1,571,313 and crude salt revenues declined by 26% to $654,039.

•	Bromine operation loss was $4,029,999, while crude salt operation loss was $102,657.

•	The losses from operations from our currently inactive chemical and natural gas businesses were $339,038 and $39,072, respectively.

Nine Months ended September 30, 2024:

•	For the nine months, revenues were $5,932,596, a decline of 74.4% compared to the same period of 2023.

•	Losses from operations by segment were as follows: bromine - $13,475,400, crude salt - $47,725, chemicals - $993,116, and natural Gas -$140,554.

•	The net loss was $40,582,933, and basic and diluted loss was $3.78 per share.

•	We incurred a loss of $29,169,008 from the disposition of equipment and purchased $60,526,213 worth of new equipment.

•	Our cash position declined to $11,237,493 from $72,223,894 as of December 31, 2023.

•	Total assets at the end of the third quarter was $193,885,294.

Management Commentary

We regret that the changes in auditors caused delays in filing the 2023 10-K and 2024 10-Q reports on time. We acknowledge the importance of providing investors with information needed to understand our financial position and the decisions made by the management. Separate press releases will be issued to address several of these matters in the near future.

Mr. Liu Xiaobin, the Chief Executive Officer of Gulf Resources, stated, “We want investors to understand that we remain confident in China’s economic recovery, in our company’s return to profitability, and in the decisions that we are making to act in the best interests of our shareholders.”

“Over the past year,” Mr. Liu continued, “we have postponed the final delivery of equipment for our chemical factory, because we did not see a short-term path to profitability. We believe some of the chemical companies in our niche in China are currently losing money. By postponing, we wanted to have the opportunity to see which segments of the industry would recover most quickly and what new opportunities, such as those for electrical strong or flow batteries, would emerge. When the timing is right, we will move ahead with the development of our chemical factory.”

“We also decided to hold off on additional investments in our natural gas business,” Mr. Liu continued. “While we remain committed to this project, we are currently seeking the best strategy.”

“We also participated in a flood prevention program required by the government,” Mr. Liu stated, “that we believe will help prevent future flood damages and allow us to drill more wells. Additionally, we are in the process of securing additional land for salt fields and bromine wells from local groups. Based on our analysis, we believe these fields could yield strong returns in the coming years.

“As the Chinese economy has begun to recover and bromine prices have started to improve,” Mr. Liu concluded, “we are becoming increasingly optimistic about the opportunities for the future.”

Conference Call

Gulf Resources management will host a conference call on Wednesday, November 20, 2024 at 08:00 AM Eastern Time to discuss its unaudited financial results of nine and three months ended September 30, 2024.

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: 287986 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 will expire on Wednesday, November 27, 2024. To access the replay, call +1 (877) 481-4010. International callers should call +1 (919) 882-2331. The Replay Passcode is 51690.

GULF RESOURCES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in U.S. dollars)

		September 30, 2024 Unaudited		December 31, 2023 Audited
Current Assets
Cash	$	11,237,493	$	72,223,894
Accounts receivable ,net		1,186,880		4,865,696
Inventories, net		427,839		577,229
Prepayments and deposits		8,311,871		8,395,290
Other receivable		95,245		7,482
Total Current Assets		21,259,328		86,069,591
Non-Current Assets
Property, plant and equipment, net		150,680,984		122,188,023
Finance lease right-of use assets		80,144		83,115
Operating lease right-of-use assets		6,385,605		6,699,784
Prepaid land leases, net of current portion		9,823,607		9,772,170
Deferred tax assets ,net		5,655,626		1,859,025
Total non-current assets		172,625,966		140,602,117
Total Assets	$	193,885,294	$	226,671,708

Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable and accrued expenses	$	15,775,145	$	8,833,936
Taxes payable-current		145,642		475,630
Advance from customer		—		42,705
Amount due to related parties		2,598,765		2,586,658
Finance lease liability, current portion		201,855		172,625
Operating lease liabilities, current portion		498,580		473,653
Total Current Liabilities		19,219,987		12,585,207
Non-Current Liabilities
Finance lease liability, net of current portion		1,103,707		1,312,950
Operating lease liabilities, net of current portion		7,036,482		7,525,255
Total Non-Current Liabilities		8,140,189		8,838,205
Total Liabilities	$	27,360,176	$	21,423,412

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; 11,012,754 shares issued; and 10,726,924 shares outstanding as of September 30, 2024 and December 31, 2023, respectively		24,623			24,623
Treasury stock; 285,830 shares as of September 30, 2024 and December 31, 2023 at cost		(1,372,673	)		(1,372,673	)
Additional paid-in capital		101,688,262			101,688,262
Retained earnings unappropriated		55,711,323			96,294,256
Retained earnings appropriated		26,667,097			26,667,097
Accumulated other comprehensive loss		(16,193,514	)		(18,053,269	)
Total Stockholders’ Equity		166,525,118			205,248,296
Total Liabilities and Stockholders’ Equity	$	193,885,294		$	226,671,708

GULF RESOURCES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
(Expressed in U.S. dollars)
(UNAUDITED)

	Three-Month Period Ended September 30,						Nine -Month Period Ended September 30,
	2024			2023			2024			2023

NET REVENUE
Net revenue	$	2,242,365		$	5,865,615		$	5,932,596		$	23,173,404

OPERATING INCOME (EXPENSE)
Cost of net revenue		(4,071,616	)		(6,373,902	)		(11,303,519	)		(20,464,418	)
Sales and marketing expenses		(13,484	)		(14,428	)		(31,608	)		(42,850	)
Direct labor and factory overheads incurred during plant shutdown		(1,736,345	)		(1,007,689	)		(7,185,537	)		(4,471,954	)
General and administrative expenses		(1,002,529	)		(762,884	)		(2,409,957	)		(2,266,260	)

Other operating income (loss)		—			—			—			60,134
TOTAL OPERATING COSTS AND EXPENSE		(6,823,974	)		(8,158,903	)		(20,930,621	)		(27,185,348	)

PROFIT (LOSS) FROM OPERATIONS		(4,581,609	)		(2,293,288	)		(14,998,025	)		(4,011,944	)

OTHER INCOME (EXPENSE)
Interest expense		(21,191	)		(23,791	)		(70,835	)		(81,322	)
Interest income		6,220			57,758			77,071			201,127
Other expenses (income)		—			—			(29,173,011	)		—
INCOME(LOSS) BEFORE TAXES		(4,596,580	)		(2,259,321	)		(44,164,800	)		(3,892,139	)

INCOME TAX BENEFIT (EXPENSE)		1,103,697			483,524			3,581,867			876,779
NET PROFIT (LOSS)	$	(3,492,883	)	$	(1,775,797	)	$	(40,582,933	)	$	(3,015,360	)

COMPREHENSIVE INCOME (LOSS)
NET PROFIT (LOSS)	$	(3,492,883	)	$	(1,775,797	)	$	(40,582,933	)	$	(3,015,360	)
OTHER COMPREHENSIVE (LOSS) INCOME
- Foreign currency translation adjustments		3,102,876			2,247,978			1,859,755			(7,879,513	)
TOTAL COMPREHENSIVE (LOSS) INCOME	$	(390,007	)	$	472,181		$	(38,723,178	)	$	(10,894,873	)

BASIC AND DILUTED EARNINGS (LOSS) PER SHARE:	$	(0.33	)	$	(0.17	)	$	(3.78	)	$	(0.29	)

BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF SHARES:		10,726,924			10,431,924			10,726,924			10,431,924

GULF RESOURCES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in U.S. dollars)
(UNAUDITED)

	Nine-Month Period Ended September 30,
	2024			2023

CASH FLOWS FROM OPERATING ACTIVITIES
Net income(loss)	$	(40,582,933	)	$	(3,015,360	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Amortization on capital lease		70,835			80,252
Depreciation and amortization		14,037,554			15,385,624
Unrealized translation difference		—			165,444
Deferred tax asset		(3,615,091	)		(1,002,511	)
Amortization of right-of-use asset		659,509			—
Loss on disposal of equipment		29,169,008			—
Changes in assets and liabilities:
Accounts receivable		3,677,653			3,132,796
Inventories		153,371			718,994
Prepayments and deposits		171,305			(3,947,311	)
Advance from customers		(42,545	)		—
Other receivables		(86,423	)		—
Accounts and Other payable and accrued expenses		(2,685,766	)		(1,503,845	)
Amount due to related Parties		—			—
Taxes payable		(330,299	)		(229,600	)
Operating lease		(889,641	)		85,129
Net cash (used in) provided by operating activities		(293,463	)		9,869,612

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment		(60,526,213	)		(15,197,648	)
Net cash from investing activities		(60,526,213	)		(15,197,648	)

CASH FLOWS USED IN FINANCING ACTIVITIES
Repayment of finance lease obligation		(264,094	)		(267,810	)
Net cash used in financing activities		(264,094	)		(267,810	)

EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		97,369			1,144,609
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(60,986,401	)		(4,451,237	)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD		72,223,894			108,226,214
CASH AND CASH EQUIVALENTS - END OF PERIOD	$	11,237,493		$	103,774,977

	Periods Ended September 30,
	2024		2023
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the nine-month period ended September 30, 2024 for:
Paid for taxes	$	1,013,382	$	4,930,601
Interest on finance lease obligation	$	70,835	$	80,252
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.

Contact Data

CONTACT: Gulf Resources, Inc.

Web: http://www.gulfresourcesinc.com

Director of Investor Relations

Helen Xu

beishengrong@vip.163.com

Cover	Nov. 19, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 19, 2024
Entity File Number	000-20936
Entity Registrant Name	Gulf Resources, Inc.
Entity Central Index Key	0000885462
Entity Tax Identification Number	13-3637458
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	Level 11,Vegetable Building
Entity Address, Address Line Two	Industrial Park of the East City
Entity Address, City or Town	Shouguang City
Entity Address, Country	CN
Entity Address, Postal Zip Code	262700
City Area Code	+86 (536)
Local Phone Number	567 0008
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.0005 par value
Trading Symbol	GURE
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false