Management Discussion and Analysis – Performance Review DAGANG NeXCHANGE BERHAD 68 FY2023 saw the Group’s consolidated financial results fall short of expectations, influenced by various factors such as market dynamics and regulatory changes that affected our profitability. However, despite these challenges, the Group has maintained a robust financial position. With various transformative strategies being undertaken to diversify revenue streams, forge new local and global partnerships, and strengthen our financial foundations, we are optimistic of a quick recovery and remain confident in our long-term growth prospects. Group Financial Performance Overview During the eighteen-month period from 1 July 2022 to 31 December 2023 (“FY2023”), the Group achieved robust revenue of RM1.913 billion, accompanied by an EBITDA of RM463.4 million. The Technology division remained the primary revenue driver, constituting 52% per cent of Group revenue. However, it encountered a notable decline in semiconductor market demand during the latter months of 2022, leading to revenue reduction from the second quarter of FY2023 onwards. Conversely, the Energy segment benefited from mostly favourable oil prices throughout FY2023, contributing significantly with 33% per cent of total revenue, while the Information Technology (“IT”) segment accounted for the remaining 15% per cent. Due to challenges affecting both our Technology and IT segments, compounded by a substantial rise in Ping’s deferred tax liabilities due to the UK’s newly introduced Energy Profits Levy (“EPL”), the Group incurred a Loss after Tax of RM190.8 million for FY2023. However, when excluding the effects of the EPL and other asset impairments and reversal of deferred tax assets, our normalised PAT for the year amounted to RM88.7 million. It’s imperative to contextualise these results amidst our organisation’s transition, given our remarkable revenue surge from RM330 million merely two years ago to nearly two billion over the past 18 months. Gaining invaluable insights from these challenges, we have responded with swiftness and agility. Throughout FY2023, we have pivoted our strategies and diversified income streams, laying crucial groundwork to bolster our growth prospects and build a more resilient DNeX for the future. REVENUE RM1,912.9 million EBITDA RM463.4 million LOSS AFTER TAX -RM190.8 million NORMALISED PAT RMRM88.7 million GROUP FINANCIAL REVIEW Technology Energy I.T. RM Million 999.2 857.7 622.5 399.9 102.6 291.2 199.8 227.9 FY2021 (18 months) FY2022 FY2023 (18 months)
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