DALLAS, TX -- June 26th, 2025 -- EnSilica PLC (AIM: ENSI): Stonegate Capital Partners updates their coverage on EnSilica PLC (AIM: ENSI) during the mid-year of 1H25. Through the beginning of calendar 2025, EnSilica PLC continued to build on its strategic initiatives and market strengths, achieving significant milestones. The Company's strong position and intellectual property in automotive, industrial, healthcare, and satellite connectivity applications for mixed-signal ASICs continue to provide a competitive edge. We believe that ENSI is well positioned to capitalize on the global ASIC market, which is projected to reach $25.0B by 2030. EnSilica continues to take meaningful steps towards having a more predictable revenue stream with an additional chip in production and an additional 4 chips in the design phase, with the Company currently having 5 ASICs in production, and another 12 in the design phase. Additionally, the Company has entered into a royalty agreement with an existing satellite service provider worth ~US$28.0M. This agreement highlights ENSI’s importance to its customers who are willing to enter into these agreements.
Company Updates:
Financial Results: For 1H25 ENSI reported revenue, adj EBITDA, and Net Income of £9.3M, (£0.2)M, and (£1.2), respectively. This compares to our estimates of £12.9M, £2.0M, and £1.3. In the first half of FY25, ENSI reported a 3% decrease in revenues to £9.3M, down from £9.6M year over year. This decline was primarily driven by new contract wins progressing slower than anticipated. Notably the Company saw an increase in supply of products revenue to £2.9M, growing 170.3% year over year. We view this as a strong sign of the Company’s continued path towards more reliable income streams, with growth in this segment expected to continue as contracts are stacked. EBITDA decreased to £(0.2)M from £0.5M in the previous year as ENSI continues its ongoing investments in scaling operations. Management still expects full year EBITDA to be positive in FY25.
Outlook Remains Positive: EnSilica’s outlook for FY25 is still promising, despite the temporary setback due to customer delays in the NRE segment. It is important to note that the expected revenue from these contracts is unchanged, however, the Company has updated its expected outlook. Revenues for FY25 are now expected in a range of £19.0M to £20.0M and £33.0M to £35.0M in FY26. We note that ENSI still has a strong order backlog and has 80% of FY26 expected revenues accounted for by current contracts. Given this we see a clear path for ENSI to support itself as it stacks more supply revenue contracts.
Momentum: ENSI has demonstrated strong momentum since the end of 1H25, securing a Memorandum of Understanding with a major European satellite operator. The Company has also released two chips for sampling into the satellite broadband market. This market is expected to grow at a CAGR of 21.4% until 2033, making it a strategic priority. Due to ENSI’s support from both the EU and UK space agencies, we view the Company as having a strong position as the global onshoring trend continues.
Valuation: We use several viewpoints to guide our valuation. Our P/E model results in a valuation range of £0.78 to £0.88 with a mid-point of £0.83. Our DCF analysis produces a valuation range of £0.74 to £0.90 with a mid-point of £0.81. Our EV/EBITDA valuation results in a range of £0.80 to £0.89 with a mid-point of £0.84. When combined our valuation ranges average at £0.77 to £0.89 with a mid-point of £0.83.
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