Company: LHI
Filing Date: 2025-05-23
Form Type: F-1
Source: 0001213900-25-046955
Chunk: 104

Company: Living Homeopathy International Ltd.
Filing Date: 2025-05-23
Form: F-1
Chunk 104
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 remedies and classic flower remedies to address the unique health issues of each customer
to accommodate his specific needs.

Key Financial Performance Indicators

To assess the performance of our business, we consider a variety of financial and operating measures. The key financial performance indicators we use include revenue, gross profit and gross margin, operating expenses, and operating income. Our review of these indicators reveals the results of our business performance and provides timely and meaningful feedbacks to key operating decisions and allow our business to respond promptly to competitive market conditions and different demands and preferences from our customers. The key measures that we use to evaluate the performance of our business are set forth below and are discussed in greater details under “Results of Operations”.

Revenue

Our revenue is derived primarily from sales of all kinds of healthcare products, personal care products as well as water filters and related products. Our revenue is affected by our ability to provide quality and effective products that consistently meet customers’ needs. Furthermore, our revenue is also impacted by our ability to expand market’s recognition of our brand to attract more customers to purchase from us and increase our market share.

Gross Profit and Gross Margin

Gross profit is calculated as the difference
between revenue and cost of revenue. Gross margin is gross profit divided by revenue. Gross profit and gross margin are measures used
by our management to evaluate the profitability of products we provided to our customers as well as how well our business strategy is
executed and performed. Our gross profit and gross margin are impacted by many internal and external factors, such as our abilities in
inventory management and cost control, market’s recognition of our brand, and the macroeconomic conditions of Hong Kong.

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Operating Expenses

Our operating expenses consist of selling and marketing expenses, staff costs and employee benefits, depreciation, lease expenses and other general and administrative expenses.

Our selling expenses primarily include commission
paid to our sales personnel, advertising expenses and other marketing and promotion related expenses.

Our staff costs and employee benefits consist
of salaries and employee benefits paid and payable to our employees.

Our depreciation consists of depreciation charge on land and building owned by the Company and leasehold improvement on our retail store.

Our lease expenses consist of rental expenses for our retail store and warehouse.

Our other general and administrative expenses
primarily include repair and maintenance for our retail store, legal and professional fee, consumables, system fees, travelling, property
related expenses, office expenses and other miscellaneous administrative expenses.

Operating Income

Operating income is calculated as gross profit minus operating expenses. Operating income