Dagang NeXchange Berhad Annual Report 2019

KEY MESSAGES annual report 2019 13 Telco Subsea Services Since 2018, DNeX through its subsidiary DNeX Telco Services Sdn. Bhd. (“DNeX Telco”), operated submarine cable installation and repair project for the telecommunications industry in Indonesia and the Philippines. The projects were awarded by Pt. Bina Nusantara Perkasa of Indonesia. Under the project, DNeX was responsible for the design, construction and installation of about 700 kilometres of fibre optic installation for two (2) lines namely Matanusa and SMPCS Patara as part of the Indonesia Global Gateway Cable System. DNeX partnered with Kokusai Cable Ship Co Ltd of Japan for these projects. With the completion of the project in early 2019, DNeX Telco contributes 7% to the Group’s revenue and less than 2% the Group’s profit in 2019. Moving forward, DNeX is keen to capture more opportunities in the submarine cable installation and repair project and expand this service offering to telecommunications and other industries. Radio Frequency Identification Solutions (“RFID”) for Border Crossing Systems DNeX RFID Sdn. Bhd. (“DRFID”) via a subcontract from TCSens Sdn. Bhd. (“TCSens”) completed the vehicle entry permit and road charges system ("VEP & RC”) development and integration using RFID technology and maintenance of the said system for border crossing between Malaysia and Singapore. DRFID was awarded a sub-contract works by TCSens to undertake the encryption of RFID VEP Tag on foreign vehicles. Moving forward, DNeX plans to focus on digitisation of highway payment via encryption of RFID VEP Tag on foreign vehicles and replicate the available system and business model for other government and semi-government agencies within Malaysia and ASEAN region. DRFID is a 51% owned subsidiary of DNeX with the remaining 49% held by TCSens, a company involved in the development and integration of RFID technology. DRFID services contributes less than 10% of the Group’s revenue. Cyber Security Services The Group’s Cyber Security Services is ISO/IEC 27001: 2013 Information Security Management System certified. It provides end-to-end cyber security services to major institutions in Malaysia to protect and defend their businesses from IT security threats. In early 2018, DNeX signed an exclusive brand licence agreement with EC-Council to offer cyber security services in Malaysia. Under the agreement, DNeX can provide cyber security consultancy and advisory services based on the delivery model, methodology and brand of EC-Council Global Services. In December 2019, DNeX disposed its stake in wholly owned subsidiary DNeX Technology Sdn. Bhd. to EC-Council in exchange for 15% stake in EGS. Cyber security services contribute less than 2% of the Group’s revenue.