Company: WCT
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044576
Chunk: 50

Company: Wellchange Holdings Co Ltd
Filing Date: 2025-05-16
Form: 20-F
Item: Item 4A
Chunk 50
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ating revenue.

For customized software solutions, the gross profit
increased by US$909,839 or 126.6% from US$718,752 for the year ended December 31, 2022 to US$1,628,591 for the year ended December 31
2023. The proficiencies gained from experience of customized computer solution have shorten the completion time frame of delivering products
to customer which resulted in decrease in cost of development.

For white label software, the gross profit decreased
by US$376,128 or 67.9% from US$553,600 for the year ended December 31, 2022 to US$177,472 for the year ended December 31, 2023. The decrease
in gross profit and gross profit margin was mainly due to decrease in demand in white label software during the current year while the
cost of developing the white label increased due to special functions requested by customers which resulted in increase in outsource costs.

For subscription service, the gross profit increased
by US$90,499 or 197.6% from US$45,803 for the year ended December 31, 2022 to US$136,302 for the year ended December 31, 2023. With increase
in scale and expansion, the Company increased its bargaining power and negotiated with customers with more competitive term and the average
contract service price increased. Nevertheless, cost of subscription service increased mainly due to the increase in the amortization
of ERP system resulted from acquisition of additional modules during the current year. As a result, the gross profit increased while its
gross profit margin decreased.

Operating expenses

                                           Years ended December 31,                                                   
                                                               2022         2023      Increase/(decrease)             
                                                                US$          US$                      US$             
 ──────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Staff costs and employee benefits                         228,893      227,042                   (1,851       (0.8  
  Rental and office expenses                                 55,823      109,947                   54,124       97.0  
  Legal and professional fees                                61,818      374,594                  312,776      506.0  
  Depreciation                                               27,618       28,900                    1,282        4.6  
  Provision of expected credit losses                             -       13,864                   13,