STRATEGIC DIRECTION In FY2025, the Group navigated a combination of external market pressures and internal operational challenges across its core business segments. Conditions in the Semiconductor, Energy and IT segments affected performance, which triggered a series of focused strategic and operational responses. Over the year, targeted actions were undertaken to reinforce core fundamentals, optimise portfolio and resource allocation, and enhance financial resilience. These measures signal a more deliberate and structured direction in how the Group positions, manages and strengthens its operations amid evolving market conditions. This included greater financial discipline, improved execution across business segments and more selective capital deployment, with investment prioritised in areas demonstrating clearer long‑term potential. The Group articulated distinct roles for its three core businesses: Semiconductor as a higher‑value technology platform, Energy as a rebalanced upstream portfolio with increasing exposure to Malaysia, and IT as a sovereign digital solutions business anchored by recurring and scalable revenue streams. • Portfolio Rationalisation and Balance Sheet Adjustments Measures were undertaken to realign the Group’s portfolio and balance sheet position during the reporting period. The divestment of the Subsea Telco business, together with the recognition of impairment charges in selected assets, reflects our efforts to streamline the portfolio and align carrying values with current market and operating conditions. • Financial Discipline and Capital Management Financial discipline was a continued focus during the year. The Group tightened control over cost structures and capital allocation in its business segments, improving efficiency and maintaining financial flexibility. Subsequent to the financial year end, the Group lodged a RM3.0 billion Sukuk Wakalah programme in March 2026, which represents a key development in the Group’s future funding structure. The programme is expected to serve as a primary funding stream, enabling selective capital deployment for operational requirements and strategic initiatives. It will enhance financial flexibility and reinforce disciplined capital allocation going forward. STRATEGIC REVIEW • Operational and Execution Focus Operational effectiveness was a key element of our strategic direction. Improvement to operating processes, reporting structures and performance monitoring strengthened coordination across business units. These measures reinforced accountability and oversight, supporting more timely and effective responses to operational challenges and contributing to improved delivery against operational targets and segment performance over time. • Segment-Level Strategic Direction Strategic priorities align with the roles and operating conditions of each business segment. In Semiconductor, DNeX is shifting towards higher-margin and more advanced technology products. This deliberate manoeuvre includes capability upgrades, collaboration with global partners and entry into growth sectors such as EV and data centres. In Energy, the Group is repositioning its portfolio towards Malaysian upstream assets. Priorities include first oil from the Abu field, improved asset economics and selective expansion of downstream equipment supply and maintenance services. In IT, we are positioning the business as a sovereign technology provider for high-trust sectors. Growth areas include AI-enabled solutions, sovereign cloud infrastructure, recurring digital services and scalable proprietary products. The direction set during the year establishes a more focused and disciplined approach to managing the Group’s businesses. Actions taken in FY2025 provide a clearer base for operational delivery, financial stability and long-term value creation. DNeX INTEGRATED REPORT 2025 46 ABOUT THIS REPORT LEADERSHIP VALUE CREATION @DNeX LEADERSHIP INSIGHTS OVERVIEW OF DAGANG NeXCHANGE BERHAD
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