DESTINI Annual Report 2020

Strategic refresh From the unprecedented developments in 2020, Destini has turned the page on a new strategic roadmap that outlines the Groups goals and key initiatives for the next few years. Many lessons were learnt during the pandemic which ultimately endorsed these new strategies in place. Our first agenda for the Group is to restructure and reorganize the Group into a leaner corporate model. Our business divisions are now called Aviation and Defence; Marine; Energy; and Rail and Land Systems and each would have one direct reporting line to ensure information is communicated efficiently. Eachbusinessdivision is tocontinuouslybuildandstrengthen its core competencies within each of its industries in response to the changing needs and appetite of growing client base and the everchanging operating environment. Operationally we will keep on driving towards increasing productivity through process improvement, digitalization and automation to achieve higher operational efficiency and effective project management. Also, part of the initiative, several committees were formed within the holding company level to discuss and analyse potential risks identification, operation cost optimization and to keep abreast in project process tracking for each business division to ensure its viability and sustainability. Risk and opportunities In 2019, a working management committee which consisted of the Group’s top management team was established. With new strategies in place, many risks and opportunities were evaluated during the year in review by the committee members. Decisions made by the committee was against the backdrop of maintaining the financial strength of the Group which is crucial in preserving investor confidence in Destini’s ability as an integrated engineering solutions provider within the industries it is in, particularly during times of uncertainty. This factor also ensures that Destini would have sufficient financial resources to pursue strategic investments that will unlock greater value for our stakeholders and help us withstand shocks within the volatile business environment. Several new policies and procedures were also implemented within the Group to embed a strong culture of corporate governance and to reduce the risk of business interruption. Management Discussion and Analysis As such, the Group envisions that it would able to enhance and ensure Destini’s business continuity and to propel the Group ahead of its local and regional competitors through operational excellence. The journey continues As we take our steps forward, we take into account the lessons learnt during the pandemic with renewed hope. As mentioned, after a year filled with uncertainties, Destini has taken pre-emptive measure to be resilient in weathering the current challenging environment. In the following years, on top of renewed business assessments and a focus on its core competencies, the Group will also focus more in strengthening its balance sheet and managing its cashflow prudently. Plans, controls, regular review and actions will be taken to tighten capital expenditure, and operating expenditure. Assessments on investments will be done diligently to ensure optimisation of the Group’s balance sheet, including its capital structure, when necessary. Destini would also start on re-evaluating its non-core assets and will reorganise or dispose of it to ensure that the Group would be able tominimise its losses in these non-core assets. Destini has not only implemented a series of cost efficiency measure to ensure its sustainability but also laid a strategy to enhance its current capabilities for expansion into new potential businesses within its related core competencies. The Group’s four core businesses are categorised as an “essential business” and business continuity should bode well as the economy slowly recovers from the impact of the pandemic. Furthermore, although the pandemic introduced uncertainties in the economy, we are confident that with the Governments stimulus packages, the gradual opening of the economy and with the COVID-19 vaccine roll-out planned for 2021 will aid the country’s economic recovery and Destini is hoping that it’s business would return back to normal by the end of the year, albeit a challenging and competitive operating environment. Nevertheless, the Group remains cautiously optimistic to weather through these uncertainties and ride on any opportunities there are in the market in 2021. The Group will also focus on the execution and safe delivery of its ongoing projects as it remains as a key priority of the Group. Operational review 40 ANNUAL REPORT 2020 DESTINI BERHAD