The financial year ended 31 December 2025 (“FY2025”) unfolded against an uneven operating landscape, with differing conditions across the Group core business segments. Cyclical adjustments in semiconductors, softer energy markets and evolving demand patterns in IT services influenced performance, prompting targeted operational and portfolio adjustments. Shifting conditions in the Group’s core sectors required careful balancing of near-term operational pressures, portfolio recalibration, tighter capital discipline and execution focus. OPERATING ENVIRONMENT AND MARKET CONDITIONS Global economic conditions in FY2025 moderated following the earlier post pandemic rebound. Elevated interest rates, persistent inflation in selected markets and cautious business sentiment weighed on investment and industrial activity. Demand trends diverged in sectors relevant to DNeX. The semiconductor industry remained in a cyclical adjustment phase as inventory normalisation and lower order volumes reduced demand. Higher-value products improved pricing and product mix, alongside a larger contribution from Emerging Technology applications. A power outage at Kulim Hi-Tech Park on 27 May 2025 caused a temporary disruption to SilTerra’s semiconductor operations during the second quarter of 2025. Energy markets softened compared with prior periods. Crude oil prices moderated and remained subject to fluctuation, influenced by supply-demand dynamics and broader economic conditions. Upstream activities faced production constraints, cost pressures and evolving regulatory requirements in mature markets. In particular, revisions to the UK’s EPL increased fiscal pressure and resulted in a deferred tax remeasurement. STRATEGIC REVIEW Turning to the domestic landscape, Malaysia’s economy remained steady, driven by domestic demand and sustained investment activity. Export-oriented sectors tracked the mixed global environment, particularly in electronics and commodities. The digital economy expanded further and was projected to contribute around 25% to national GDP by end‑2025, supported by continued digitalisation and wider adoption of technology solutions. Operating conditions differed according to business segment. The Group’s Semiconductor segment faced softer market conditions, marked by reduced shipment volumes and customer‑led inventory adjustments. Improved product mix and pricing partly mitigated the impact although production was affected by operational disruption during the year. The Energy segment faced combined market and operational pressures. Lower realised oil prices and reduced lifting volumes weighed on performance as gas shortages and temporary shutdowns further affected output. Mature asset profiles and UK regulatory developments added further pressure. The IT segment operated under more stable demand conditions. Trade facilitation services and enterprise solutions delivered steady contributions amid increasing demand for cloud-based services, secure digital infrastructure and AI-enabled applications. FY2025 required DNeX to address immediate operational pressures while positioning its core segments for more stable performance. 45 OPERATIONAL REVIEW SUSTAINABILITY STATEMENT GOVERNANCE FINANCIAL STATEMENTS SHAREHOLDERS’ INFORMATION INTELLIGENCE POWERING
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