DNeX Records Higher Earnings of RM9.1m in Q3
Strong Performance Driven by Diversified Business Model
Dagang NeXchange Bhd (DNeX) has recorded a profit after tax and non-controlling interest (Patanci or net profit) of RM9.1 million for its third quarter ended September 30, 2024 (Q3’24) on the back of a revenue of RM263.0 million.
Revenue Breakdown
The technology segment was the largest revenue contributor, generating RM161.5 million or 61% of the total revenue. The energy segment followed with RM52.4 million, contributing 20%, while the Information Technology (IT) segment accounted for the remaining RM49.1 million, representing 19% of the total revenue.
Technology Segment
Revenue from the technology segment rose by 3% to RM161.5 million compared to RM156.2 million in Q2’24 driven by higher average selling prices on the product mix.
Energy Segment
The energy segment reported a softer revenue in Q3’24 of RM52.4 million as compared to RM92.0 million in Q2’24. The performance was primarily impacted by lower average oil prices (Q3’24: 74.98/bbls; Q2 2024: 85.30/bbls) and reduced lifting volume resulting from a planned well maintenance shutdown for maintenance purposes.
IT Segment
The IT segment delivered a revenue of RM49.1 million in Q3’24 from RM50.0 million in Q2’24. Subsea telco as well as technology consulting and system integration (Tech Consulting and SI) businesses recorded increased contributions due to completion of cable installation and repair work services, and progress milestone of the ongoing projects, respectively. However, this was offset by lower revenue from trade facilitation in tandem with completion and progressive work done of certain projects.
Net Profit and Revenue for the Nine-Month Period
DNeX’s net profit for the nine-month period ended September 30, 2024 amounted to RM28.6 million, with total revenue reaching RM871.0 million. Due to the change in the financial year-end from June 30 to December 31, there is no year-on-year comparison available for the quarter.
Strategic Initiatives
DNeX is advancing its trade facilitation services through new software solutions that modernize and streamline processes, from document submission to the transmission of digital forms across borders. Additionally, the integration of AI into DNeX’s smart solutions can significantly enhance their capabilities and lead to increased operational efficiency and cost savings for both government agencies and private enterprises.
Executive Chairman’s Comments
DNeX executive chairman Tan Sri Syed Zainal Abidin Syed Mohamed Tahir Jamalullail said: “As we reflect on our progress this quarter, we are encouraged by the continued strength of our diversified business model and the opportunities that lie ahead. Our focus remains on building a sustainable future by leveraging our expertise, expanding our capabilities, and embracing new technologies. We are committed to growth locally and internationally and are confident that our strategies will deliver long-term value for all stakeholders.”
Financial Position
As at September 30, 2024, the group maintains a strong net cash position, with a total cash balance of RM476.3 million, surpassing its total borrowings of RM74.7 million.
Conclusion
DNeX’s strong performance in Q3’24 is a testament to its diversified business model and commitment to growth. The company’s strategic initiatives, including the development of new software solutions and integration of AI, are expected to drive long-term value for its stakeholders.
FAQs
Q: What was DNeX’s profit after tax and non-controlling interest (Patanci or net profit) for Q3’24?
A: RM9.1 million
Q: What was DNeX’s revenue for Q3’24?
A: RM263.0 million
Q: Which segment generated the largest revenue for DNeX in Q3’24?
A: The technology segment, with a revenue of RM161.5 million (61% of total revenue)
Q: What was the impact of average oil prices on DNeX’s energy segment in Q3’24?
A: Lower average oil prices (Q3’24: 74.98/bbls; Q2 2024: 85.30/bbls) and reduced lifting volume resulting from a planned well maintenance shutdown for maintenance purposes.