Company: ILAG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001641172-25-006445
Chunk: 194

Company: Intelligent Living Application Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 5
Chunk 194
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,332,746            20.5   %              1,306,755            10.7   %
                       $6,480,207            86.3   %             $5,731,503            88.2   %            $10,418,800            85.7   %
 
The following table sets forth the Company’s revenues from customers by geographical areas based on the location of the customers:
 

                                    For the years ended                        
-------------------------------------------------------------------------------
                                                                   December 31,
         2024                      2023                     2022               
US                $7,393,736               $6,364,773               $11,717,347
Canada               112,815                   78,584                   440,755
Total             $7,506,551               $6,443,357               $12,158,102
 
Our profit margin was approximately 6.8% due to the tariff war between US and China started in 2018. To mitigate the impact of tariff war, we have launched a series of procurement actions to reduce the costs, and we managed to gradually improve our profit margins, which was 17.5% for 2024, 9.8% for 2023 and 18.1% for 2022. In addition, once tariff war is settled and inflation is under control along with our continuous efforts in expanding product selections and varieties, better procurement of raw materials, ability to improve production efficiency, attracting new customers and initiatives to reduce our overhead costs, we hope to return to profitability. As the permit for electro-plating production is more stringently regulated in China, we acquired an electro-plating production line in 2022 in an industrial park near our Xingfa factory to reduce outsourced electro-plating costs. However, the high interest rate and tariff war between China and U.S. have made our customers more cautious in placing more orders. As a result, our gross margin was negatively affected by amortization of idle capacity. To increase the utilization rate, the management is developing electro-plating business to provide services to third parties with our newly acquired plant and also continued the development of new smart lock products for mainland China, Cambodia and Hong Kong markets which expect to launch by the end of 2025.
 
Key Factors Affecting Our Results
 
We believe the key factors affecting our financial condition and results of operations include the follows:
 

●                                          Our Relationship with Customers. We rely heavily on                                        
      customers’ demand