SASBADI HOLDINGS BERHAD 22 Management Discussion and Analysis Despite the softer performance recorded during the financial year, the Group made meaningful progress in the development of its flagship digital platform, Ace-it. Key enhancements included the integration of AI-enabled functionalities designed to support teachers and students by providing AI-generated content aligned to the National Curriculum through a seamless and integrated digital experience. While these product research and development (“R&D”) initiatives have yet to generate direct revenue, they have delivered encouraging strategic outcomes. Notably, the Group was invited by the MOE to showcase Ace-it at the ASEAN AI Malaysia Summit 2025 (12–13 August 2025) under the MOE’s Super Booth, underscoring institutional confidence in Sasbadi’s capability to deliver next-generation education solutions. In parallel, the Group was also invited to participate in the AI-Powered Classroom Pilot Project, a nationwide initiative running from August 2025 to March 2026 that focuses on the strategic integration of hardware, software, and AI technologies to deliver a more adaptive and inclusive learning environment across selected schools. Under this initiative, Sasbadi will serve as a strategic partner for content, collaborating with numerous appointed infrastructure strategic partners. Subsequent to the financial year end, the Group also signed two (2) Letters of Acceptance from the MOE. These include a contract valued at RM500,000 for the provision of English language proficiency testing services for English option teachers, as well as a contract valued at RM432,000 for the supply and delivery of interactive digital storybooks for preschool education. Together, these contracts reflect the Group’s continued relevance and growing footprint in both digital education services and content delivery. Applied Learning Products (“ALP”) and STEM Education The Group's ALP and STEM segment's revenue decreased from RM5.523 million for the preceding financial year to RM3.115 million for the current financial year, representing a decrease of RM2.408 million (equivalent to 43.60%). The softer performance during the current financial year was primarily attributable to the MOE’s moderation in fund allocation to schools, as compared to the preceding financial year, to promote Science, Technology, Engineering, and Mathematics (“STEM”) education. Notwithstanding this, the Group remains encouraged by the sustained relevance and long-term impact of its STEM initiatives. Through Sasbadi’s long-standing partnership with the MOE, which began in 2005, the Malaysian contingent once again achieved outstanding success at the World Robot Olympiad International Final 2025 held in Singapore from 26 to 28 November 2025. The team emerged as Overall Champion for the 13th time, reaffirming Malaysia’s position on the global stage. This remarkable accomplishment not only reflects the effectiveness of Malaysia’s STEM education ecosystem, but also highlights the creativity, technical proficiency, and 21st century competencies of Malaysian youths, reinforcing the Group’s commitment to nurturing future-ready talent. Paper-based Stationery The Group’s Paper-based Stationery segment’s revenue stood at RM2.115 million for the current financial year. As this is a newly established segment in the FYE 2025, no year-on-year comparison can be made. During the FYE 2025, Edu Paper and Stationery Sdn Bhd focused primarily on the production of exercise books for the school market, including the manufacture of school-branded exercise books for nationwide distribution to support daily teaching and learning activities. Furthermore, the Company continued to serve several international customers and has, during the current financial year, implemented initiatives aimed at expanding its international customer base.
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