| LEASE LIABILITIES - FINANCE AND OPERATING LEASE |
NOTE
13 – LEASE LIABILITIES - FINANCE AND OPERATING LEASE
The
components of finance lease liabilities were as follows:
SCHEDULE
OF FINANCE LEASE LIABILITIES
| | |
June
30,
2026 | |
December
31,
2025 |
| Total
finance lease liabilities | |
$ | 5,427,254 | | |
$ | 5,404,546 | |
| Less:
Current portion | |
| (211,682 | ) | |
| (228,918 | ) |
| Finance
lease liabilities, net of current portion | |
$ | 5,215,572 | | |
$ | 5,175,628 | |
The
financing leases include one contract with a lease term from January 1, 2011 to December 31, 2030, and five contracts with the lease
term from June 29, 2024 to June 28, 2044. All contracts have a non-cancellable lease period of 20 years, and the Company has the right
to preferentially renew the lease contract under the same conditions upon the contract expires. However, the Company will decide whether
to renew the lease based on the market operation situation upon the expiration.
The
components of operating lease liabilities are as follows:
SCHEDULE
OF OPERATING LEASE LIABILITIES
| | |
June
30,
2026 | |
December
31,
2025 |
| Total
Operating lease liabilities | |
$ | 6,625,707 | | |
$ | 7,014,947 | |
| Less:
Current portion | |
| (162,222 | ) | |
| (523,847 | ) |
| Operating
lease liabilities, net of current portion | |
$ | 6,463,485 | | |
$ | 6,491,100 | |
The
components of lease cost were as follows:
SCHEDULE
OF LEASE COST
| | |
2026 | |
2025
(Restated) |
| | |
Six-Month
Period Ended
June 30, |
| | |
2026 | |
2025
(Restated) |
| Finance
lease cost: | |
| | | |
| | |
| -
Amortization of right-of-use assets | |
$ | 1,478,008 | | |
$ | 1,549,239 | |
| -
Interest on lease liabilities | |
| 123,980 | | |
| 121,954 | |
| Operating
lease cost | |
| 447,905 | | |
| 435,102 | |
| Total
lease cost | |
$ | 2,049,893 | | |
$ | 2,106,295 | |
Maturities
of lease liabilities were as follows:
SCHEDULE
OF MATURITIES OF FINANCE AND OPERATING LEASE LIABILITIES
| | |
Finance
Lease | |
Operating
Lease |
| the
next 12 months | |
$ | 275,580 | | |
$ | 352,721 | |
| the
next 13 to 24 months | |
| 275,580 | | |
| 870,202 | |
| the
next 25 to 36 months | |
| 5,222,122 | | |
| 874,823 | |
| the
next 37 to 48 months | |
| 275,580 | | |
| 883,588 | |
| the
next 49 to 60 months | |
| — | | |
| 888,585 | |
| thereafter | |
| — | | |
| 7,475,764 | |
| Total | |
| 6,048,862 | | |
| 11,345,683 | |
| Less:
Amount representing interest | |
| (621,608 | ) | |
| (4,719,976 | ) |
| Present
value of net minimum lease payments | |
$ | 5,427,254 | | |
$ | 6,625,707 | |
A
summary of supplemental information related to leases is listed as follows:
SCHEDULE
OF SUPPLEMENTAL INFORMATION RELATED TO LEASES
| | |
June 30, 2026 | |
December 31,
2025 |
| Weighted
average remaining lease term: | |
| | | |
| | |
| Finance
leases | |
| 15.7
years | | |
| 15.7
years | |
| Operating
leases | |
| 20.4
years | | |
| 19.6
years | |
| Weighted
average discount rate: | |
| | | |
| | |
| Finance
leases | |
| 4.43 | % | |
| 4.53 | % |
| Operating
lease | |
| 4.90 | % | |
| 4.90 | % |
Supplemental
cash flow information related to leases were as follows:
SCHEDULE
OF SUPPLEMENTAL CASH FLOW INFORMATION
| | |
2026 | |
2025 |
| | |
Six-Month
Period Ended
June 30, |
| | |
2026 | |
2025 |
| Cash
paid for amounts included in measurement of lease liabilities: | |
| | | |
| | |
| -Operating
cash flows from operating leases | |
$ | 777,234 | | |
$ | 743,404 | |
| -Financing
cash flows from finance leases | |
$ | 272,297 | | |
$ | 260,997 | |
| | |
| | | |
| | |
| Non-cash
information on lease liabilities arising from obtaining right-of-use assets: | |
| | | |
| | |
| -Finance
leases | |
$ | — | | |
$ | — | |
| -Operating
leases | |
$ | — | | |
$ | — | |
GULF
RESOURCES, INC.
AND SUBSIDIARIES
NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE
30, 2026
(Expressed
in U.S. dollars)
(UNAUDITED)
|