TIDMKETL
RNS Number : 9755M
Strix Group PLC
27 January 2021
27 January 2021
Strix Group Plc
("Strix"; "Company" or the "Group")
Pre-Close Trading Update and Notice of Results
Strix Group Plc (AIM: KETL), the global leader in the design,
manufacture and supply of kettle safety controls and other
complementary water temperature management components, is pleased
to announce the following trading update for the year ended 31
December 2020.
Current trading
The Group experienced a marked recovery in H2 as anticipated,
and a strong order book has enabled it to deliver circa 2% growth
in adjusted profit after tax for the full year versus the previous
financial year (2019: GBP28.9m). Strong sales since June have been
driven by replenishment of pipeline stock and a strong seasonal
uplift .
This performance demonstrates the resilience of Strix's business
model, which benefits from geographical and product
diversification, and is strengthened further by the Group's high
cash generation and prudent control of its balance sheet. Current
strong order book visibility for Q1 underpins the Board's continued
confidence.
Kettle Safety Controls
The Kettle Safety Controls market has experienced a strong
bounce back in the second half of 2020. Throughout this volatile
period, Strix has managed to maintain its market leading position
for kettle safety controls, continuing to grow the number of
specifications using its latest platform ranges which demonstrates
how successfully the Company has dealt with the challenges of the
pandemic.
The much improved performance in the second half has continued
into 2021. The Kettle Safety Controls category has a strong order
book for January and Q1 giving management the confidence in
delivering a stronger first half versus last year.
Water Filtration
2020 was a successful year for Strix's water filtration division
with the acquisition of LAICA in October and the Aqua Optima brand
delivering record sales for yet another year. Strix's experienced
management team is working hard to ensure the integration of LAICA
is executed effectively to achieve the identified benefits and the
trading performance has been strong over the period delivering
double-digit revenue growth. The new, expanded, brand portfolio
will be used for the planned geographical expansion in the second
half of 2021 for consumer water. The Group expects many of the new
product launches in 2020 to accelerate this year as the retailers
introduce them to their in-store and online portfolios.
For professional water, Strix recently announced that the
HaloPure technology was selected by Chia Tai Group, one of the most
specialised, well-known livestock companies operating in China, and
Strix will install its full system by the end of January 2021.
HaloPure's technology has become increasingly well recognised by
the market and the evolution to offer farming solutions for clean
drinking water is likely to result in significant further business
opportunities for the Group in the future.
Appliances
2021 will see many of the appliances created in 2020 penetrate
the consumer markets across the world with the most notable being
the Aurora (Instant Flow Heater/Chiller) in the first half, and
Dual Flo and the expansion of the Baby Care technology range in the
second half.
Strix will continue to work closely with its key brand partners
and own brands to bring innovation to the markets delivering core
benefits in usability and sustainability to the consumer.
Financial Position
The business remains highly cash generative, maintains a robust
balance sheet and has a strong liquidity position. As at 31
December 2020, net debt was lower than previous guidance for this
financial year, having successfully implemented a range of
efficiency measures and strategic initiatives. This places Strix in
a financially strong position and with a disciplined approach to
investment, we will emerge from the pandemic well positioned for a
market recovery.
Given the Group's performance in 2020 and the Board's confidence
in the continued strength of its cash generation, the Board
confirms its intention to pay a total dividend of 7.7p per share in
respect of the 2020 financial year, inclusive of the 2.6p per share
paid as an interim dividend .
Operational, New Product, Corporate Progress and Managements
The relocation of Strix's existing manufacturing operations in
China has continued to make excellent progress in line with the
projected schedule, and the Group is pleased to report that the
external construction is now complete and on budget and has
recently received a successful construction completion audit by the
local government. Strix will begin transferring some of the
production lines after the Chinese New Year and remains on schedule
to be fully operational by August 2021, as originally planned.
In addition to its investment in growth initiatives, the Board
continues to invest in strengthening its management in line with
its strategy and to explore strategically compelling acquisition
opportunities, subject to strict financial criteria and consistent
with its capital allocation priorities, to further enhance the
Group's growth potential within the Water Filtration and Appliance
categories.
Outlook and Notice of Preliminary Results
Despite the impact on the global economy, the Group is robust
and, as a market leader with an unrivalled global footprint,
remains confident in its future prospects. Following the successful
implementation of efficiency measures and strategic initiatives,
the Group is in a strong position to continue to invest in
compelling growth opportunities and well placed to benefit from the
acceleration in demand and emerge as a stronger business once
COVID-19 passes.
The Group will be announcing its preliminary results for the
year ended 31 December 2020 on 24 March 2021.
Mark Bartlett, Chief Executive Officer, said:
"Strix has successfully delivered modest growth in adjusted
profit after tax for the full year which is testament to how well
the Company has dealt with the challenges of the pandemic.
"Consistent with what was announced at the Capital Markets Day
in November, the recent strong performance underpins our confidence
of doubling Group revenues over the next five years. We remain
focused on i nvesting in compelling growth opportunities to support
this medium-term ambition, as well as e xecuting on ESG commitments
which is core to our strategy to provide a safer sustainable future
for our customers."
Strix Group Plc +44 (0) 1624 829829
Mark Bartlett, CEO
Raudres Wong, CFO
Zeus Capital Limited (Nominated Advisor and Joint Broker) +44 (0) 20 3829 5000
Nick Cowles / Jamie Peel / Jordan Warburton (Corporate Finance)
Stifel Nicolaus Europe Limited (Joint Broker) +44 (0) 20 7710 7600
Matthew Blawat / Francis North
IFC Advisory Limited (Financial PR and IR) +44 (0) 20 3934 6630
Graham Herring / Tim Metcalfe / Florence Chandler
ABOUT STRIX GROUP PLC
Isle of Man based Strix, is a global leader in the design,
manufacture and supply of kettle safety controls and other
components and devices involving water heating and temperature
control, steam management and water filtration.
Strix's core product range comprises a variety of safety
controls for small domestic appliances, primarily kettles. Kettle
safety controls require precision engineering and intricate
knowledge of material properties in order to repeatedly function
correctly. Strix has built up market leading capability and
know-how in this field since being founded in 1982.
Strix is admitted to trading on the Alternative Investment
Market of the London Stock Exchange (AIM: KETL).
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