Company: MKDWW
Filing Date: 2025-04-03
Form Type: F-1
Source: 0001641172-25-002610
Chunk: 122

Company: MKDWELL Tech Inc.
Filing Date: 2025-04-03
Form: F-1
Chunk 122
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.00 million for the year ended December 31, 2023 to US$1.83 million for the year ended December 31, 2024, primarily due to a decrease in our direct material cost with respect to manufactured electronic products and a decrease in labor cost due to the deflation of production scale, which are in consistent with the decrease in revenues from our sales of manufactured electronic products and commissioned processing service.

Gross profit and gross profit margin

Gross profit represents our revenues less cost of revenues. Gross profit margin represents our gross profit as a percentage of our revenues.

Gross profit decreased by US$0.50 million, or 75.4% from US$0.67 million for the year ended December 31, 2023 to US$0.17 million for the year ended December 31, 2024, and gross profit margin decrease from 18.4% in 2023 to 8.3% in 2024, primarily attributed to the elevated fixed costs associated with labor costs. The company is actively optimizing its workforce to mitigate labor costs.

Selling expenses

Selling expenses primarily consist of: (i) salaries and benefits for sales personnel, (ii) freight expenses, (iii) rental and depreciation allocated to selling department, (iv) certain other expenses.

Our selling expenses decreased by US$0.01 million, or 3.90% from US$0.24 million for the year ended December 31, 2023 to US$0.23 million for the year ended December 31, 2024, which was relatively stable. Selling expenses did not decreased in line with revenue because our selling expenses is composed of fixed expenses, such as salaries.

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General and administrative expenses

General and administrative expenses primarily consist of: (i) professional service fees; (ii) salaries and benefits for general and administrative personnel, (iii) rental and depreciation allocated to general and administrative department, (iv) other corporate expenses.

Our general and administrative expenses increased by US$0.56 million, or 37.50% from US$1.49 million for the year ended December 31, 2023 to US$2.05 million for the year ended December 31, 2024, which was primarily attributable to (i) an increase of US$0.36 million in professional service fees for the purpose of effecting our business combination with Cetus Capital, (ii) an increase of US$0.18 million in