Datasonic Group Berhad Annual Report 2020

3.4.3 Significant Contracts Awarded i) The Company made an announcement on 3 June 2019 in regards to the acceptance of a Letter of Award from Kementerian Dalam Negeri (“KDN”) by Datasonic Technologies Sdn. Bhd. (“DTSB”), a wholly-ownedsubsidiaryoftheCompany,forthemaintenanceservicesofcardpersonalisationcentres at theNational RegistrationDepartment (“Perso. CentreMaintenanceContract”) for a period of two (2) years commencing from 1 June 2019 to 31 May 2021, for a contract sum of RM28,785,686.27 (inclusiveof 6%SST) or RM14,392,843.14per year, with anoption toextend theContract for another year. Subsequent to the financial year, the Company announced that DTSB had on 10 June 2020 received and accepted the Letter of additional spare parts scope (“LOASPS”) dated 4 June 2020 from KDN in respect of the contractmentioned in the foregoingparagraph. Under the LOASPS, the contract sum increased from RM28,785,686.27 to RM36,084,172.36 (inclusive of 6% SST), with an additional contract value of RM7,298,486.09. ii) On 16 January 2020, DTSB received and accepted the Letter of Extension (“LOE”) dated 14 January 2020 from Kementerian Dalam Negeri (“KDN”) for the extension of supply for the balance of 6.1 millionMyKad rawcards andMyKad consumables to theNational RegistrationDepartment (“NRD”) for the period of one (1) year commencing from 1 January 2020 to 31 December 2020. iii) On 31 January 2020, DTSB received and accepted the Letter of Change of Scope (“LOCS”) dated 23 January 2020 fromKDN in respect of the supply of theMalaysian Passport Chips for a period of five (5) years or 12.5millionof Passport Chips (“Passport ChipsContract”) commencing from1December 2016 to 30 November 2021 with no change to the contract sum of RM318.750 million. Under the LOCS, the total quantity of Passport Chips to be supplied would be reduced from 12.5 million chips to 11 million chips, amounting to RM280.5 million and a new scope of works would be included for the maintenance services for hardware and software of Autogate and Chips and the maintenance services for equipment and application of Public Key Infrastructure (“PKI”) and Public Key Directory (“PKD”), amounting to RM38.250 million. On 3 February 2020, the Company provided the following additional information: a) Thenewscopeofworks for themaintenance services of hardwareand software for theAutogate andChipsandthemaintenanceservicesforequipmentandapplicationofPKIandPKD,amounting to RM38.250 million, commenced with effect from 10 May 2019 and valid until 30 November 2021. b) ThemaintenanceservicesofhardwareandsoftwarefortheAutogateandChipsandthemaintenance servicesforequipmentandapplicationofPKIandPKDwerepreviouslyawardedtoanothercompany under2differentcontractsandwhichhadexpiredandnowawardedtoDTSBconsolidatedintothe Passport Chips Contract. c) ThedemandoftheMalaysianPassportsdroppedfromaverageof2.5millionperyeartoapproximately 2.2millionperyearsincetheabolishmentofthe2-yearvaliditypassportoptionin2015.Therefore, the reduction of number of chips from12.5million to 11million for the 5-year Contract from1 November2016to30November2021willnotaffectthefinancialperformanceoftheCompanyas thedemandof passports for thecontract periodof 5years isapproximately11millionnow; rather than 12.5 million. d) The newscope of works amounting toRM38.250millionwith effect from10May 2019 until 30 November2021will contributepositively towards the futureearnings andnet assetsper shareof DatasonicGroup for the financial year ending 31March2020 and the financial years thereafter. iv) On 3 February 2020, DTSB won an open tender participated by 18 companies on 21 October 2019 for the supply, deliver, installation, testing, integration, commissioning and technical support of equipment, software and application for 16 units of foreigner e-gate with facial recognition system at theMalaysia-Singaporeentry/exit point tothe ImmigrationDepartmentofMalaysia for a12months period commencing from 15 February 2020 to 14 February 2021 for a contract sum of RM6,973,125.91. Management Discussion & Analysis (Cont’d) DATASONIC GROUP BERHAD I ANNUAL REPORT 2020 (Registration No. 200801008472 (809759-X)) 26