MKDWELL Tech Inc., a business company incorporated in the British Virgin Islands with operations in Mainland China and Taiwan, recently announced its unaudited financial results for the first half of 2024. The company reported total revenues of $0.81 million, representing a decrease of 61.3% from the same period in 2023.
The decrease in revenues was primarily attributed to the termination of a key customer relationship due to a mismatch in price expectations. As a result, new customer relationships were primarily in the trial production stage in the first half of 2024, leading to a decline in sales revenue. Additionally, expenses related to the Nasdaq listing and business combination with Cetus Capital contributed to an increase in loss from operations.
Following the completion of the business combination with Cetus Capital in July 2024, MKDWELL Tech Inc. acquired MKDWELL Limited as its wholly-owned subsidiary and an indirect equity interest in MKD Technology Inc. The company is now listed on Nasdaq and is focused on shifting its attention to business and customer development.
In terms of financial performance, the company reported a gross profit of $0.07 million with a gross profit margin of 8.2%, compared to $0.32 million and 15.2% in the same period of 2023. Loss from operations increased by 83.4% to $1.54 million, while net loss increased by 77.8% to $1.73 million.
Revenues from sales of manufactured electronic products and commissioned processing services decreased significantly, contributing to the overall decline in total revenues. Cost of revenues also decreased by 58.2%, primarily due to lower labor costs.
Selling expenses remained stable, while general and administrative expenses increased by 71.7%, mainly due to professional service fees related to the business combination. Research and development expenses slightly decreased, as the company continued to focus on software development.
Interest expenses increased by 32.6%, primarily due to newly borrowed loans from related parties. Other expenses, net increased by 266.8%, mainly due to a decrease in government subsidies.
The company’s unaudited condensed consolidated financial statements indicate that it is operating on a going concern basis, with uncertainties surrounding its ability to reduce net losses in the foreseeable future. MKDWELL Tech Inc. has historically relied on financing from banks, related parties, and third-party investors to support its operations.
Overall, the company is actively seeking new customers, optimizing its workforce to mitigate costs, and focusing on improving product quality to increase customer trust and dependence. With a strategic shift towards business and customer development, MKDWELL Tech Inc. aims to overcome current challenges and achieve sustainable growth in the future.