61 ANNUAL REPORT 2025 MST GOLF GROUP BERHAD Expected Financial Impacts Across Climate Scenarios The Group assessed the potential financial implications of selected climate scenarios to better understand how changing weather patterns and climate conditions may affect operations, customer activity, and cost exposure over time. The assessment considered the possible effects of increasing rainfall variability and rising temperatures across different time horizons, using a directional scenario-based approach to evaluate how climate-related disruption may influence retail performance, operating continuity, and business resilience. The analysis was intended to support risk awareness, resilience planning, and strategic decision-making, rather than to predict precise financial outcomes. Based on the Group’s current operating profile, the analysis indicates that climate-related financial impacts are expected to remain manageable in the near term, but may become more pronounced over the medium to longer term, particularly under higher-emissions pathways. Key areas of potential exposure include: l reduced outdoor golf activity during adverse weather conditions; l shifts in customer footfall and demand patterns; l higher energy demand and cooling-related operating costs; l disruption to retail activity, events, and golf-related services; and l broader operational and cost pressures associated with more volatile climate conditions. The Group also recognises that climate-related risks may present both challenges and opportunities. A significant portion of the Group’s retail presence is located within indoor shopping malls, which may provide some resilience against weatherrelated disruption. In addition, indoor golf and experiential formats may help support customer engagement during periods of adverse outdoor conditions. While the quantified financial impacts assessed under the scenario analysis are not considered immediately destabilising to the Group’s business model, the analysis reinforces the importance of continued climate awareness, operational adaptability, and resilience planning as part of the Group’s broader risk management approach. Climate Scenario Short to Medium Term Long Term Strong Mitigation (SSP1-1.9 / RCP2.6) Relatively stable operating conditions with limited disruption; gradual shift in customer expectations and sustainability-related operating requirements. Lower physical risk exposure, with continued need to align with evolving sustainability standards and reporting expectations. Intermediate Mitigation (SSP2-4.5 / RCP4.5) Increasing variability in rainfall and temperatures may contribute to moderate disruption to customer activity, operating conditions, and cost discipline. Greater operational planning complexity and increasing need for resilience, cost management, and adaptive operating practices. High Emissions (SSP5-8.5 / RCP8.5) More frequent adverse weather conditions may contribute to higher volatility in retail activity, energy use, and operational continuity. Higher physical climate risk exposure, with increasing pressure on operating resilience, facilities, cost structure, and customer activity patterns. The Group will continue to refine its climate-related scenario analysis over time as internal data maturity improves and more relevant operating and environmental information becomes available. This will support progressively more informed assessment of climate-related risks, opportunities, and resilience priorities across the business, while enhancing the decision-usefulness of future climate-related disclosures.
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