Cyberjaya, 25 February 2021 – Dagang NeXchange Berhad (“DNeX”) has announced its financial results for the fourth quarter ended 30 December 2020 (“4Q FY2020”). As announced earlier, the financial year end of the Group has been changed from 31 December to 30 June. The next audited financial statements shall be for a period of 18 months from 1 January 2020 to 30 June 2021.

During the quarter under review, DNeX recorded a revenue of RM63.3 million as compared to RM87.3 million in the previous year’s corresponding period (“4Q FY2019”). Meanwhile, the Group registered a higher profit after tax and non-controlling interest (“PATNCI” or “Net profit”) of RM15.1 million as compared to a loss of RM3.7 million in 4Q FY2019.

Revenue from IT segment stood at RM46.2 million in 4Q FY2020 from RM68.9 million last year, on the back of lower progress billing from completed projects and the absence of contribution from a one-off submarine cable laying and maintenance contract completed in FY2019. The Trade Facilitation & e-Commerce business recorded recovery in 4Q FY2020 with marginally lower revenue against 4Q FY2019. As compared to the preceding quarter (“3Q FY2020”), this division has shown a quarter-to quarter increase in trade transaction volume of 8.6 per cent with an increase in revenue of RM1.0 million.

The Energy segment revenue was at RM17.1 million in 4Q FY2020, a slight decrease from RM18.5 million in 4Q FY2019 mainly impacted by lower progress billings and the imposition of the Movement Control Order that has led to a slowdown in project implementation.

The IT division remained the anchor revenue contributor to the Group, representing 73 per cent of the Group’s 4Q FY2020 revenue while the remaining 27 per cent was from the Energy division. There was a reversal of non-cash impairment loss on intangible assets totalling RM13.5 million during the quarter.

For the 12 months period ended 31 December 2020, the Group registered revenue of RM239.5 million, a reduction from RM290.5 million in FY2019 due to lesser revenue contribution from the IT segment. The overall year-to-date trade traffic volume dropped by 2.5 per cent affected by economic slowdown due to Covid-19 pandemic. The decrease was offset by higher revenue contribution from the Energy segment, which increased 22.7 per cent year-on-year to RM73.8 million from RM60.1 million, driven by better performance in Trading & Services unit.

Share of result of associate stood lower at RM9.3 million as compared to RM18.3 million in FY2019 due to postponement of its latest uplift to January 2021 in anticipating higher oil price.

The Group has so far raised gross proceeds totalling RM93.9 million from the issuance and private placement of 397.6 million new DNeX shares.

“Moving forward, DNeX is heading towards greater growth as we embark on strategic investments that will strengthen our market presence in our core business segments of Trade Facilitation, System Integration & Consultancy, and Energy. We are well positioned as the digital partner for businesses and Government agencies towards improvements and efficiency in their processes. We will continue to pursue opportunities in digitalisation including the recently announced MyDigital initiative, which is aimed at accelerating digital transformation among the public and private sectors in the country,” said Dato’ Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of DNeX.

“With the strong recovery of oil prices to levels above USD60 per barrel, our proposed acquisition of an additional 60 percent stake in Ping Petroleum Ltd will augur positively for us. Furthermore, acceptance of bid by the Consortium led by DNeX for the proposed sale of SilTerra Malaysia Sdn Bhd, marks a significant milestone for the Group in view of the strong demand for semiconductor chips globally,” he said.

The Group, he added, is also upbeat on the growth prospects of its telecommunication business as the demand for certified vessels have been on the rise due to advancement of telecommunications systems, which require powerful and effective transmission lines. DNeX through a consortium formed between business unit PT DNeX Telco Indonesia and PT Samudera Mbiantu Sesami, has recently signed a Consortium Agreement with PT Infrastruktur Telekomunikasi Indonesia for the deployment, management, maintenance and repair as well as other value added works for the Maintenance Support Sistem Komunikasi Kabel Laut within and outside of Indonesia.