Ethernity Networks (LON: ENET) shares are up 36% in London today. The cause is a contract win which should provide some much needed cash to bolster the corporate finances. This is both - by reference to corporate size at least - a substantial sum and also a near immediate one. This does indeed aid the company in these harsh times.#
The announcement: “Ethernity Networks (AIM: ENET.L; OTCMKTS: ENETF), a leading supplier of data processing semiconductor technology for networking appliances, is pleased to announce that it has signed an extended license contract for $475,000 (the "Contract") with a Tier 1 US based military aerospace customer (the "Customer"). This Contract is further to an advanced payment received in October 2023 of $80,000 from the Customer. Payments for the Contract are expected to be received during November and December 2023. As a result, the total anticipated revenue from the Customer during Q4 2023 is $555,000.” Now, OK, we might think of that as being something of a tiddler of a contract. Which, actually, it is. But given the current dire straits at Ethernity it’s very useful indeed.
Ethernity Networks share price from Google Finance
Last time we looked the share price was 0.2 pence at Ethernity Networks: Ethernity Networks (LON: ENET) shares are down 76% over the past 5 days. Sure, we could say there’s a war on (not that there quite is but we could say it) and that’s what’s causing the problems. But this isn’t, in fact, quite so. Clearly, events in Israel do not help matters. But the economy still works, the courts, the banks and so on. The problems are more deep seated than what’s been happening this past couple of weeks. Effectively, no one seems to want to pay Ethernity. Or, not enough with to do so. Therefore there’s something of a gaping hole where the revenue receipts should be. And so an application for what is the Israeli equivalent of a Chapter 11 filing.”
We would be very surprised indeed if Ethernity manages to simply trade its way out of this. The TSP process is now extended to end of Dec 2023. It’s possible that it could come out of this smelling of roses. But given that TSP process that’s what the bet is. Will they be able to pick up sufficient business - real, cash, business - in this next couple of months?
