Member Info for trading1987

https://ethernitynet.com/whatsnew_inteview/?utm_source=2&utm_medium=3&utm_campaign=WhatsNew

Interesting interview with Brian K.

https://www.ft.com/content/797e7ee3-f8a1-4f31-bfa4-5d7c1b727172 (paywall).

*“I have already told all of you at the beginning of the year,” Yang Jie, chairman of China Mobile, the largest carrier in the world by mobile subscribers, said in an interim results briefing last Thursday. “No matter what happens, our overall capital expenditure during this three-year peak investment period of 5G, including this year, will not increase drastically.” Indeed, the company kept the annual capital expenditure plan unchanged at Rmb179.8bn ($26bn) from the beginning of the year.

*Both Huawei and ZTE told some suppliers to slow down shipments of certain 5G base station-related products in June, so the Chinese companies could redesign products and change some equipment to remove as much US content as possible. It is part of a “de-Americanisation” effort by China after the Trump administration tightened export controls on Huawei, multiple sources said.

*Wang Xiaochu, China Unicom chairman, revealed on an online conference call on August 12 that the company’s alliance with China Telecom had saved more than Rmb40bn in capex for the duo over the year, on top of other cuts in operating spending, such as tower usage fees, network maintenance costs and utilities charges. “Both sides have licked the sweet parts of the deal already,” said Mr Wang. The two carriers are expanding 5G co-operation into existing 4G network cost-sharing, for example, to maintain transmission facilities. Ke Ruiwen, chairman of China Telecom, on Tuesday echoed Mr Wang’s point and said: “The company will continue to deepen the ‘co-build, co share’ framework to reduce network construction costs and operating expenses.” Both carriers have kept their annual capex plan unchanged for the whole year, Rmb70bn for Unicom and Rmb85bn for Telecom. The 5G investment savings in China will go further as China Mobile and the fourth carrier, China Broadcasting Network, have agreed on their version of “co-build, co-share” and are in talks to confirm the details.

Quick poll - what do the guys estimate the revenue of the company to be by the end of 2021?

Finally feels like we are getting some long-term investors building positions, rather than the day-trading twitter crowd (who we'd rather stay away).

Fingers crossed for some deal news in August and Q4 (i'm particularly keen on the China side of things - given how far along they are with 5g deployment). GLA

Dallo - they probably don't have the 100k so need to fish around!

A nice RNS tomorrow, and this baby could quite easily close the week at 30-35p.

TL / Bid - don't know whether you agree, but it is nice to see Ethernity's name out and about a bit (especially linked to 5g).

I personally believe that under the 5G workstream (in the east i.e. China, S Korea etc.), this company could be worth 10-15x more than it is now.

TL - this is the bit from the FT (for interest)
"Progress has been halting, particularly in Europe, according to David Levi, the chief executive of Aim-listed Ethernity Networks. He said one operator had passed him to its suppliers to discuss using his technology to speed up data flows, but they had little interest in pursuing the idea".

Dallo agree - I think the market opp moving into the future isn't something Ethernity ever had any control over, and its linked into multiple event in the global economy. I suppose from the various bits of news we have had, we know the tech is clearly of interest (look at the type of clients they've had, traction with China/S Korea, the Gartner report, contracts with military/aerospace clients). I wonder whether VSA will do anything's in terms of research to Chinese investors.

Agree Dallo - even positive RNS, research notes etc etc can at least wip up some sort of interest in the company.

At the minute there really is nothing - and hence the effect on the share price. What the key risk here is that the raise doesn't cover them to the point of profitability - the market will clearly not react kindly, and they will have to raise at a very silly price.

Fully agree with the sentiments of Dallo.
I suppose the other thing to note is a company like Ethernity is probably not on many managers radar, especially before large deals land. Especially given there is currently no research/analyst coverage.

Hopefully some nice RNS's over the summer should give us the leg up this share deserves.... i'd like to be close to the green (my avg is c.24p), and this is c.7% of my overall portfolio!!

It's a real shame the management have not had a better strategy in dealing with the financing.
Unfortunately we are not party to the discussions and the doors that they may have knocked on. I can understand from David's point of view that he would not have wanted any dilution, and it seems he fought it off until the last degree, and even then gone for the absolute bare minimum. For me this company is amazing, really innovative and has some great attributes (probably the best growth prospects on AIM).
However like most you, what sticks in the craw is how badly the financing has been handled. I still believe that come H2 2021, the company will be cashflow generative and posting a decent profit (as we've seen the rns on the various wins, deals, agreements, they've built a great foundation) - but as always a great deal of patience is required until we get there!

Interesting that staff and directors are subscribing £240k - that's c.30% of the placing (will mainly be David and Shavit) but nonetheless they still are keeping significant skin in the game here.

For most here, the ideal situation was for Ethernity to get some loan financing, but hey, if this solves the financing piece of the puzzle, and we can all pick up some cheap shares along the way, then we can all be happy if the SP is 60p+ by the end of the year. For me the tech clearly has scalability, and the work they have done in that regards + the chinese deals, and Tieto/Techtronics deals should easily carry them to a decent profit H2 2021. Clearly Ethernity have screwed up financing a few times (I'd grade them 3/10), but the on the tech side of things and the deals they are 10/10.

My god the market is really asleep at Ethernity's potential. But its a nice open goal for the people on this board - we should be able to clean up.... get your avg down to 20-30p easily at this rate!!

TL - pure speculation here, but how much to do think the deal with Techtronics could be worth in terms of revenue?

My feeling right now is David/CFO when delivering the annual results, need to provide lots of concrete guidance, as it is clear the market just doesn't see the potential of the various revenue streams. I'm not as tech savvy as TL, but clearly all the foundation work Ethernity have done just in the last 12mths will be worth significant revenue in 2021 onwards (e.g. Korean OEM, TietyEvery, 5G UPF China, Fiberhome, Techtronics and the other deals)!

I think we have to accept these things as par for the course for such a small company.

The IA grant was always slightly risky to bet the house on. What matters now is that David + CFO show leadership and sort financing - whether that is a fund raise or otherwise, they just need to sort it. I understand for David he will try his best not to dilute, as he does not want to "give his company away". He needs to think unemotionally and do what is right over the long term, and securing financing comes with a cost (whether it is equity or debt based).

Fundamentally - we have proof the tech works, and they seem to have a number of rev streams, including the JV with Tieto. These will take time, and David has told us that in the COVID update.

Most of us here are disappointed (and rightly so), as a lot seemed to hang on the IA grant. But I'd urge patience, David and our interests are aligned - I just hope he can solve the financing puzzle and get the show on the road!!!

Could also help perk up interest from larger institutional funds in China - if this is played right, and the research gets into the hands of fund managers/institutional investors, we should see some influx of long-term shareholder capital.

Fingers crossed now that the next RNS lands with some great news on the israeli state grant/loan!!

I agree with TL - this stock is so different to your average AIM its unbelievable. They've pretty much upped their RNS game and if you read between the lines - 2021 is going to be major as revenue streams across different contract start to be realised. The fact this is c.75% in private hands, and David is a big shareholder, means he'll be loathed to dilute himself (especially at this price) given he knows exactly how much this company is worth in 1-4 years. I'm sure they explore lots of other avenues. If though they have no options left (and given the crazy times we are in), I'd imagine he'll dilute the least amount possible.

Israeli govt announces a raft of measures across all areas, including creating a special loan facility for SMEs! Enet could utilise if required.

"Loan up to 500,000 NIS or 8% of the company’s annual revenue (the highest between the two)"

https://home.kpmg/xx/en/home/insights/2020/04/israel-government-and-institution-measures-in-response-to-covid.html