Unless otherwise defined, all capitalised terms used herein shall have the same meanings ascribed to them in the announcements dated 1 April 2022 and 24 June 2022 in relation to the acquisition of Central Solar Sdn. Bhd. (now known as Nestcon Solar Sdn. Bhd.) (“Nestcon Solar”) by Nestcon Sustainable Solutions Sdn. Bhd. (“NSS”), a 51%-owned subsidiary of the Company.

Pursuant to the Share Sale Agreement dated 1 April 2022 and the Supplemental Share Sale Agreement dated 24 June 2022, Main Way Venture Sdn. Bhd. (“the Vendor”) had provided an unconditional and irrevocable profit guarantee that Nestcon Solar shall achieve an aggregate audited profit after tax of RM6.0 million for the financial years ended 31 December 2022, 2023 and 2024.

The Board of Directors of Nestcon wishes to announce that Nestcon Solar was unable to meet the said profit guarantee for the financial year ended 31 December 2024, being the final year of the guaranteed period.

The non-fulfilment of the profit guarantee was primarily due to unprecedented price reductions in the global solar module market. This sharp decline triggered an intensely competitive environment, where aggressive pricing strategies adopted by industry participants resulted in significant margin compression, thereby adversely affecting overall profitability.

Under the terms of the Share Sale Agreement and Supplemental Share Sale Agreement, the Vendor is required to compensate for the shortfall, up to a maximum of RM1.5 million.

Notwithstanding the above, Nestcon Solar continues to strengthen its position within the renewable energy sector and has successfully participated in or secured projects under the following national initiatives:-

- Corporate Green Power Programme (“CGPP”)
- Large Scale Solar 5 (“LSS5”)
- LSS Sabah
- Large Scale Solar 5+ (“LSS5+”)

These projects are expected to contribute positively to the Group’s earnings from financial year 2025 onwards.

This announcement is dated 18 September 2025.