ESK surges as the company announces FY2017 revenue growth
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
Wireless technology group, Etherstack (ASX:ESK), announced on Wednesday morning that it expects to achieve revenues of circa $6.1 million in fiscal 2017, representing the top end of its June guidance which was in a range between US$5.8 million and US$6.1 in fiscal 2017.
Based on this guidance the company should generate revenues of circa $8.3 million in Australian dollar terms. The market has responded positively to this news with the Etherstack’s shares opening 14.3% higher on Wednesday morning.
Note, historical data in terms of earnings performance and/or share trading patterns should not be used as the basis for an investment as they may not be replicated. Those considering this stock should seek independent financial advice.
Commenting on this promising news, Etherstack’s Chief Executive, David Deacon said, “2016 was a very successful year for Etherstack with the major growth coming from network orders for our utilities sector customers in both North America and in Australia, as well as our tactical communications products”.
Deacon highlighted that the network projects deliver revenues not only in the year of deployment but in future years, as an expanded installed base of established networks generate recurring support revenues and additional expansion/upgrade opportunities.
Having delivered at the top end of guidance, Deacon sees 2016/17 as the foundation for further revenue growth in 2017 and 2018 as newly developed products and technologies start to contribute to revenues.
The benefits of end-user diversification in relation to Etherstack’s business where it generates income from customers across the defence, utilities, transportation and resources sectors.
Given the group’s contracts are generally of a long-term nature with an established income stream, the significant proportion of recurring revenue provides earnings visibility.
For example, the company announced as recently as mid-December the award of a network expansion contract by Atco Electric to provide additional sites and capacity in relation to its mission-critical radio communications network which supports electricity distribution and transmission operations in Canada.
The current deliveries, additional phases and recurring support revenues are expected to generate approximately US$3.1 million in total over the next 4 to 5 years.
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
