Cyberjaya, 29 August 2024 - Dagang NeXchange Berhad (“DNeX”) has recorded a profit after tax and non-controlling interest (“PATANCI” or net profit) of RM5.0 million for its second quarter ended 30 June 2024 (“2Q FY2024”), on the back of a revenue of RM298.1 million.
Its Technology division contributed RM156.2 million to the revenue, representing 52.4 per cent of the total. The Energy division accounted for RM91.9 million, or 30.8 per cent while the Information Technology (“IT”) segment contributed RM50.0 million, making up the remaining 16.8 per cent.
Revenue from the Technology division, at RM156.22 million, was higher by RM18.26 million in the current quarter, compared to RM137.96 million in the immediate preceding quarter, marking an increase of 13 per cent.
During 2Q FY2024, the Group’s Technology division is seeing stronger demand, reflected in rising average selling prices per wafer and per mask layer as well as higher manufacturing loading. This has led to improvement in revenue and bottom-line performance, which will be further supported by ongoing efforts to optimise costs and enhance production efficiency.
The Group also remained focused on its high-margin business model by strategically investing in emerging technologies such as Silicon Photonics, and Life Sciences.
Over at the Energy division, revenue reached RM91.95 million, lower by 13 per cent compared to RM105.93 million in the immediate preceding quarter mostly due to lower average oil price (Q2, 2024:84.3/bbls; Q1, 2024:87.0/bbls).
In the IT segment, the RM49.95 million revenue was lower by 24 per cent in the current quarter as compared to the immediate preceding quarter at RM65.93 million mainly due to lower revenue from subsea telco business from lower cable installation and repair work services, and lesser revenue from Technology Consulting and System Integration (“Tech Consulting and SI”) business based on the progress milestone of the ongoing projects.
The Group’s Trade Facilitation segment remained strong with revenue increase of RM9.4 million or 39 per cent (Q2 2024:RM33.5 million; Q1, 2024: RM24.1 million) in tandem with completion and progressive work done of certain projects.
This brings DNeX’s net profit for the first half of 2024 to RM19.5 million, with total revenue reaching RM607.9 million. There is no year-on-year comparative for the quarter, due to the change in the financial year end from 30 June to 31 December.
Moving forward, for its Energy segment, production volumes are set to increase with the Group growing its assets beyond its only producing asset in the North Sea, UK. The Group recently enhanced its portfolio with the addition of three new oil and gas (“O&G”) assets - the Bubu, Bunga Tasbih, and Enau fields - located on the east coast of Peninsular Malaysia. These fields, located near the existing Abu and Meranti Clusters, offer substantial synergy potential for development. The division plans to enhance production efficiency and lower costs by leveraging the proximity of these fields through infrastructure sharing or tie-back arrangements. The immediate focus will be on reactivating the Abu Cluster, with a target to achieve first oil in 2025 with an anticipated 2,500 barrels per day.
The Group had steadily expanded its Malaysian O&G portfolio, via Ping Petroleum Limited, starting with the A Cluster (off Sarawak) and Meranti Cluster (off Terengganu) in January 2023, followed by the Abu Cluster (off Terengganu) in October 2023, and most recently, in July 2024, with the Small Field Asset (“SFA”) Cluster that includes the Bubu, Bunga Tasbih, and Enau fields.
This expansion supports the Group’s strategy to increase revenue and diversify geographically. Internationally, the Group’s presence in the UK remains strong, with assets including the producing Anasuria field and several greenfield developments such as Fyne, Avalon, Pilot, Glenn, and Hutton. which provide a solid pipeline for future development and growth.
Ping’s expansion in Malaysia will also create additional and synergistic opportunities for DNeX’s other subsidiary OGPC Sdn Bhd, an O&G integrated service company that provides a suite of services and technical equipment within the sector. The upgrade of OGPC’s Kemaman Supply Base Workshop enhances service offerings and strengthens its position as an integrated provider, enabling it to secure more revenue from trading, and maintenance, repair, and operations (“MRO”) projects. Further enhancements to the facility are planned this year in preparation to support Ping’s operations in Malaysia.
In its IT segment, the Group will continue to leverage its expertise from successful projects such as the National Single Window (“NSW”) for Trade Facilitation, Integrated Government Financial and Management Systems (“iGFMAS”), and the Inland Revenue Board’s Hasil Integrated Taxation Systems (“HITS”) to contribute to the Government’s digitalisation initiatives.
To further enhance its capabilities in offering robust and latest technologies, DNeX plans to forge strategic partnerships with leading global IT companies. The focus is on securing large-scale IT and digitalisation projects across public and private sectors, both locally and internationally. In the Middle East region (Kuwait, Saudi Arabia, Qatar), DNeX is pursuing opportunities in smart port, e-government services, and system integration projects.
DNeX’s Executive Chairman Tan Sri Syed Zainal Abidin Syed Mohamed Tahir Jamalullail said, “Over the past several years, DNeX has undergone a strategic transformation to strengthen business resilience within our operations and better capitalise on emerging opportunities. Moving forward, we will continue to focus on our Technology business whilst at the same time enhancing the value of our Energy and IT business segments towards optimising shareholder value.”
As at 30 June 2024, the Group is in a healthy net cash position with total cash balance of RM739.5 million, exceeding total borrowings of RM265.6 million.
For further information, please contact
Pareto SecuritiesFor media related queries, please contact
Sharifah Kasim Al Edrus
Head, Group Corporate Communications & Sustainability
Dagang NeXchange Berhad
Dagang Net Tower, Block 10 (A&B) Corporate Park,
Star Central, Lingkaran Cyberpoint Timur, Cyber 12,
63000 Cyberjaya, Selangor
Phone: +603-8230 6900
Fax: +603-8230 6969
Email: media@dnex.com.my