EnSilica PLC (AIM: ENSI) has showcased resilience and strategic growth potential in its mid-year update for the first half of 2025, as noted by Stonegate Capital Partners. The company, known for its mixed-signal ASICs catering to automotive, industrial, healthcare, and satellite connectivity sectors, is reinforcing its market stance. With five ASICs currently in production and twelve in the design phase, EnSilica is progressing towards establishing a more predictable revenue stream, further highlighted by a substantial royalty agreement valued at approximately US$28.0M with a satellite service provider.
Despite a slight 3% revenue dip to £9.3M from the previous year, attributed to the slower pace of new contract acquisitions, EnSilica experienced a remarkable 170.3% year-over-year surge in product supply revenue, reaching £2.9M. This growth emphasizes the company's transition towards more stable income sources. Although EBITDA saw a reduction to £(0.2)M from £0.5M, due to investments aimed at scaling operations, the management team remains hopeful about achieving a positive full-year EBITDA in FY25.
Looking ahead, EnSilica maintains a positive outlook for FY25 and FY26, with projected revenues of £19.0M to £20.0M and £33.0M to £35.0M, respectively. A robust order backlog, representing 80% of FY26's anticipated revenues, lays a solid foundation for future growth. Recent milestones, including a Memorandum of Understanding with a leading European satellite operator and the launch of two chips for the satellite broadband market, further cement EnSilica's strategic position in a sector expected to expand at a CAGR of 21.4% until 2033.
Stonegate Capital Partners' valuation of EnSilica, utilizing P/E, DCF, and EV/EBITDA methodologies, points to an encouraging mid-point valuation of £0.83, signaling strong belief in the company's growth path and market opportunities.
