v3.26.3
PROPERTY, PLANT AND EQUIPMENT, NET
 6 Months Ended
Jun. 30, 2026
Property, Plant, and Equipment [Abstract]  
PROPERTY, PLANT AND EQUIPMENT, NET

NOTE 6 – PROPERTY, PLANT AND EQUIPMENT, NET

 

Property, plant and equipment, net consist of the following:

 

   June 30,
2026		  December 31,
2025
At cost:          
Mineral rights  $2,831,561   $2,743,826 
Leasehold Improvements   14,284,153    13,053,292 
Plant and machinery   129,848,075    125,170,996 
Furniture, fixtures and office equipment   859,683    833,046 
Motor vehicles   30,550    29,603 
Total   147,854,022    141,830,763 
Less: Accumulated depreciation and amortization   (88,686,124)   (79,598,798)
Less: Impairment   (297,070)   (287,865)
Net book value  $58,870,828   $61,944,100 

 

 

GULF RESOURCES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2026

(Expressed in U.S. dollars)

(UNAUDITED)

 

NOTE 6 – PROPERTY, PLANT AND EQUIPMENT, NET – Continued

 

The rollforward of property, plant and equipment, net was as follows:

 

At cost:  December
31, 2025		  Remodel
of Brine
Well(a)		  Remodel of
Chlorine
Gas Shed
and
finished
liquid
pond(b)		  Remodel of Production Equipment(c)  Depreciation(d)  Foreign
currency
translation		 

June

30, 2026

Mineral rights  $2,743,826    —      —      —      —      87,735   $2,831,561 
Leasehold
Improvements		   13,053,292    —      548,463    255,324    —      427,074    14,284,153 
Plant and machinery   125,170,996    (203,213)   —      869,843    —      4,010,449    129,848,075 
Furniture, fixtures
and office equipment		   833,046    —      —      —      —      26,637    859,683 
Motor vehicles   29,603    —      —      —      —      947    30,550 
Total   141,830,763    (203,213)   548,463    1,125,167    —      4,552,842    147,854,022 
Less: Accumulated depreciation and
amortization		   (79,598,798)   320,430    4,255    —      (6,788,877)   (2,623,134)   (88,686,124)
Less: Impairment   (287,865)   —      —      —      —      (9,205)   (297,070)
Net book value  $61,944,100    117,217    552,718    1,125,167    (6,788,877)   1,920,503   $58,870,828 

 

(a)The Company had undergone renovation and upgrade work on the brine well, which covered bromine plant production  and the automation platform upgrade. In the first quarter of 2026, the Company transferred the original cost of $337,295 and related accumulated depreciation of 320,430 to construction in progress, and additional project costs amounted to $117,217. The upgrade was completed and capitalized in April 2026.

 

(b)In the first quarter of 2026, the Company completed the renovation and upgrade project for the chlorine gas shed and finished liquid pond, at a total cost of $552,718.

 

(c)In the second quarter of 2026, the Company upgraded Plant No. 2 and No.10, involving chlorine shed renovation, installation of a liquid-chlorine leak absorption unit, sulfur furnace replacement, and distillation building reinforcement and replacement. The total cost was $1,125,167, and the project was finalized and captitalized in April 2026.

 

(d)During the three and six months period ended June 30, 2026, depreciation and amortization expense totaled $3,432,091 and $6,788,877, respectively, which was recorded in direct labor and factory overheads incurred during plant shutdown, cost of revenue, and general & administrative expenses.

 

During the three and six months period ended June 30, 2025, depreciation and amortization expense totaled $3,217,980 and $6,444,107, respectively, which was recorded in direct labor and factory overheads incurred during plant shutdown, cost of revenue, and general & administrative expenses.