Gulf Resources Reports 23% Revenue Increase to $1.6 Million, Net Loss Grows to $4.6 Million

Gulf Resources, Inc. reported a net revenue of $1.6 million for the three-month period ending March 31, 2025, marking a 23% increase from $1.3 million in the same period of the previous year. The company’s cost of net revenue decreased by 25% to $1.6 million, down from $2.1 million, resulting in a gross profit of $10,177, a significant recovery from a gross loss of $812,783 in the prior year. Despite these improvements, Gulf Resources recorded a net loss of $4.6 million, which is a 16% increase compared to the net loss of $4 million reported in the first quarter of 2024.

The company’s operational performance showed notable changes, particularly in its bromine segment, which generated $1.5 million in revenue, a 29% increase from $1.1 million in the previous year. This growth was attributed to a 45% rise in the average selling price of bromine, despite an 11% decrease in the volume sold. The crude salt segment also saw a modest revenue increase of 5%, reaching $122,578, driven by a 16% rise in sales volume. However, the chemical products and natural gas segments reported no revenue due to ongoing operational challenges.

Gulf Resources has been actively managing its operational costs, with direct labor and factory overheads incurred during plant shutdowns decreasing by 14% to $3.2 million. General and administrative expenses rose significantly by 94% to $1.4 million, reflecting increased operational activities and costs associated with compliance and regulatory requirements. The company’s total operating loss improved to $4.6 million from $5.3 million in the previous year, indicating a strategic focus on cost management and operational efficiency.

As of March 31, 2025, Gulf Resources had total assets of $165.7 million, a decrease from $169.5 million at the end of 2024. Current assets stood at $17.6 million, with current liabilities reduced to $15.3 million, resulting in a current ratio of 1.15. The company’s cash and cash equivalents decreased to $8.5 million from $10.1 million, primarily due to cash used in operating activities. The accounts receivable balance increased significantly to $2.1 million, reflecting a $1.5 million rise compared to the previous quarter, which may impact liquidity if not managed effectively.

Looking ahead, Gulf Resources aims to enhance its operational capabilities and market presence, particularly in the bromine and crude salt segments. The company is also focused on addressing regulatory compliance issues and optimizing its production processes. However, it faces challenges related to ongoing governmental approvals for its chemical and natural gas operations, which could affect future revenue generation. The management remains cautious but optimistic about regaining compliance with Nasdaq listing requirements and improving financial performance in the upcoming quarters.