24th Feb 2020 10:20
(Alliance News) - Ethernity Networks Ltd on Monday said it expects to report double-digit revenue growth in 2019, with further contract wins going forward.
The network processing technology developer said it traded in line with forecasts in 2019 and expects to report annual revenue about 20% ahead of the prior year's USD1.1 million.
In addition, Ethernity said its operating costs in the second half of 2019 decreased by 5% compared to the first half.
During the year, the company said it has continued to progress engagements on SmartNIC and UEP offerings. However, some contracts, which were previously expected to close during the first two months of 2020, have been delayed, Ethernity said, due to issues "outside the company's control".
More positively, the company said it expects to receive orders for new design projects from existing customers during the course of the second quarter of 2020. Also, it said it has seen a growing demand from Chinese telecoms companies for its solutions based on FPGA, a 5G enabling network circuit.
Looking ahead, Ethernity said it anticipates that positive cash flow generation will commence by the end of the first half of 2021.
"Our business is to sell the FPGA NIC and the associated software package, therefore any customer engagement where the customer is working and investing efforts on operating their virtualized software application on top of our ACE-NIC represents a long-term revenue opportunity of significantly more value to the company than IP or project business opportunities with immediate, albeit lower, income generation," said Chief Executive David Levi.
Ethernity shares were trading 4.4% higher in London on Monday at 47.50 pence each.
By Evelina Grecenko; [email protected]
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