OUR STRATEGIC CONTEXT 40 MANAGEMENT DISCUSSION & ANALYSIS Supported by its healthy cash position, the Group undertook a proactive deleveraging exercise during the year, reducing total borrowings by 42.1%, from RM44.8 million to RM26.0 million. This significant reduction in debt contributed to an 18.4% decrease in finance costs, while strengthening the Group’s interest coverage and overall financial resilience. In addition, lease liabilities declined by 16.8% to RM52.9 million, reflecting the Group’s ongoing efforts to optimise its retail footprint and secure more favourable leasing terms across selected locations. These measures form part of the Group’s broader initiative to streamline its cost structure, enhance capital efficiency and reinforce its financial position as it continues to navigate evolving market conditions. Consequently, our gearing ratio improved significantly from 0.18 times in FY2024 to 0.11 times in FY2025. This low gearing provides the Group with substantial financial headroom and the necessary capital flexibility to fund our ongoing regional expansions, including our entry into the Thai market and the continued scaling of our presence in Indonesia. Dividends During the FY2025 and FY2024 the dividends paid by the Company are as follows: RM’000 In respect of the FY2025 - An interim single tier dividend of RM0.0025 sen per ordinary share paid on 30 December 2025 2,052 In respect of the FY2024 - An interim single tier dividend of RM0.0025 sen per ordinary share paid on 30 December 2024 2,052 The Board did not recommend the final dividend for the financial year ended 31 December 2025. Key Risks And Risk Management The Group operates in a dynamic and evolving environment, and its performance may be affected by various internal and external risks. Key risks include macroeconomic uncertainties, fluctuations in foreign exchange rates, supply chain disruptions and cybersecurity risks. As a specialty golf retailer that relies heavily on imported products from international brands, the Group is exposed to changes in global trade conditions and currency volatility may affect procurement costs and product pricing. To mitigate the impact of cautious consumer spending, the Group has implemented proactive measures focused on operational resilience. We have refined our product mix to include more valueoriented offerings and intensified our CRM initiatives to drive customer loyalty. Additionally, we are maintaining a disciplined approach to cost management, optimizing our supply chain and overheads to protect core margins. In addition, the Group has established an Enterprise Risk Management (“ERM”) policy and framework, which provides a structured approach to identifying, assessing and managing key business risks. The Board regularly reviews the Group’s risk profile through updates presented by the Governance, Risk and Sustainability Committee (“GRSC”), ensuring that appropriate mitigation strategies are implemented. Further details on the Group’s risk management policy and framework can be found in the Statement on Risk Management and Internal Control in this Annual Report. Future Prospects and Regional Outlook Looking ahead to FY2026, the Group is poised for recovery and growth. Our strategic entry into Thailand with first store planned to be opened in mid 2026 will serve as a primary catalyst, further diversifying the Group’s revenue streams and providing a natural hedge against localized market fluctuations. We anticipate the Thailand retail outlet to begin contributing to the Group’s top-line performance, tapping into a market renowned for its robust golfing community and high tourist footfall. This expansion is expected to not only broaden our regional market share but also provide a natural hedge against the softening demand observed in more mature markets. By leveraging the Group’s successful operational blueprint from Indonesia, we intend to scale our Thailand operations in a measured and disciplined manner, while steadily improving store productivity as the business matures. Consequently, the Group remains confident that this new revenue stream, together with continued retail strengthening across our core markets, will enhance earnings resilience and support longterm shareholder value creation across Southeast Asia.
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