This article first appeared in The Edge Malaysia Weekly on November 10, 2025 - November 16, 2025

Shareholders of Destini Bhd ­(KL:DESTINI) were jolted last week when the integrated engineering solutions company failed to issue its annual report by the deadline set under listing rules.

The company avoided a potential share suspension, however, by releasing the annual report for the 12 months ended June 30, 2025, just days after the Oct 31 due date.

Destini, which depends on government contracts for its core business, attributed the delay to the consolidation of accounts from its newly acquired overseas subsidiaries. The external auditor gave the report a clean bill of health, noting only Destini’s rising receivables, which stood at RM191.3 million at the end of the financial period, representing 51% of the company’s total assets.

Historically, the external auditor has consistently flagged Destini’s relatively high receivables, likely owing to the nature of its business, where its primary customer is the government. Generally, payments from government contracts are secure but irregular.

Nevertheless, Destini’s receivables have generally remained low as a percentage of assets, around 38%. For example, in 2019, trade receivables stood at RM211.8 million, representing 36% of total assets.

Based on the latest annual report, of Destini’s RM191.3 million in receivables, RM144.2 million were trade receivables with average repayment periods of 60 to 90 days, while RM46.7 million were overdue by more than 90 days. In the most recent financial year, Destini made provisions, reducing the overdue amount to RM25.7 million.

As a company whose primary customer is the government, Destini cannot afford delays in issuing its annual reports. More importantly, it must focus on reducing receivables, as they have a direct impact on the company’s cash flow.

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