Integrated Report 2023 71 supplier pool for raw materials to mitigate reliance on individual suppliers and reduce the risk of disruptions from primary suppliers. In our Energy division, we are adopting prudent expansion strategies that leverage on our existing strengths and infrastructure. This is evident not only through our expansion into Malaysia, which diversifies our market risks across various geographical regions, but also through strategic acquisitions of new fields near our existing operations to improve operational and resource efficiencies. Additionally, we are ensuring a well-balanced mix of near- and long-term prospects within our portfolio to enhance revenue stability. Meanwhile, our Information Technology division has been proactive in diversifying our revenue streams beyond government contracts. Recently, we secured a 3.5-year contract from the Port Klang Authority to develop, implement, and maintain the Malaysia Maritime Single Window (“MMSW”) Phase 1, marking our entry into the maritime trade sector. Additionally, the division has undertaken rigorous measures to improve financial management. Recognising the challenges encountered in both current and legacy projects, we have proactively conducted a comprehensive study to pinpoint areas for improvement and have subsequently implemented robust measures to strengthen financial management and discipline across the Information Technology segment. At the Group level, we are actively addressing human resource risks, particularly concerning the recruitment of top talent and the enhancement of employee management practices. On this note, our newly appointed HR Director is spearheading efforts to elevate DNeX into a high-performing organisation by focusing on improving the competencies and commitment of our workforce. Looking forward Despite a challenging financial performance in FY2023, there are compelling reasons to remain optimistic about the future financial outlook of the DNeX Group. Although our Technology division faced difficulties during this period, the semiconductor industry retains significant potential. It is crucial for us to exercise patience and prepare to seize opportunities during the anticipated upswing, with demand expected to rebound in the latter half of 2024, driven by the recovery of PC and smartphone demand. Simultaneously, our substantial investment in the development of MEMS and Silicon Photonics is poised to yield positive results in the near future. As the demand for these emerging technologies continues to rise steadily, coupled with our ongoing product testing and qualifications with global customers, we are wellpositioned to capitalise on growth opportunities driven by the surge in AI, EVs and advanced medical technologies. Regarding our Energy segment, the outlook for FY2024 suggests stability in oil prices, with anticipated increases in supply aligning with growing demand. Moreover, voluntary supply cuts from several OPEC+ members are expected to further stabilise the market1. Given our status as a low-cost operator, profitability remains feasible as long as crude oil prices remain above USD60 per barrel. Additionally, our strategic decision to commence operations in Malaysia has unlocked new avenues for revenue growth. Among the three Malaysian fields where we acquired a working interest in FY2023, our immediate priority is the reactivation of the Abu Cluster, where we hold a 100 per cent interest. First oil production is anticipated by early 2025, at a volume of 2,500 barrels per day. In the current era of rapid digital advancement, our Information Technology segment holds significant promise for expansion. Led by our IT Strategy and Transformation Department, and leveraging on collaborations with esteemed partners such as prominent data and business analytics specialists CapGemini and Stratek, we aim to bolster our portfolio of large-scale IT projects both domestically and internationally, serving both public and private sectors. In Malaysia, we are actively pursuing digital transformation projects with various government ministries, capitalising on the national drive towards digitalising public services. Looking abroad, we envision considerable opportunities in collaboration with our partners from China and Saudi Arabia, Zhongheguoji Construction Group and Ajlan & Bros Holding Group, particularly in the Middle East and North Africa region. This includes prospective ventures in smart city development, e-government services and system integration projects. While our financial performance in FY2023 may not fully capture the potential of our ongoing initiatives, we remain optimistic about the future. Our concerted efforts to diversify revenue streams and strategically expand into adjacent industry sectors are poised to yield substantial benefits. We are confident that these calculated moves will enhance our future financial performance and lay the groundwork for robust and sustainable growth in the years ahead. ** References: 1 Oil Market Report - March 2024 | International Energy Agency | https://www. iea.org/reports/oil-market-report-march-2024
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