Strix Share Discussion Threads

[masurenguy] 04/2/2023 09:02

Current broker eps forecasts for this year is 12.1p, which puts them on a PER of circa 9. However, one should also factor the debt of £87m into the investment criterion, of which £25m can be accounted for from the contribution to the £38m Billi acquisition cost, with the balance of £13m derived from the placing at 115p last October. I hold having previously exited prematurely @192p in June 2020 and then subsequently reinvesting here @89p in December 2022.

[undervaluedassets] 02/2/2023 11:44

Covid in China will fade into the background and the Chinese will learn - as we have -
that you have to live with it.

Then the world's biggest kettle technology company will go back to business.

[bothdavis] 02/2/2023 09:44

Or, to take a more postive view,....it look half full to me......better than empty!!

[cyberbub] 02/2/2023 09:23

That Liberum report sounds a bit glass-half-empty if you ask me?

[masurenguy] 02/2/2023 08:59

Punched straight through 100p this morning on a minmal trading volume. Question is can it turn 100p into support and can it close above that over the next two sessions!

[masurenguy] 02/2/2023 07:47

China reopening to aid kettle-part maker Strix, says Liberum

A reopening of the Chinese economy could provide a much-needed boost for kettle-component maker Strix (KETL), says Liberum. Analyst Edward Maravanyika maintained his ‘hold’ recommendation and increased the target price from 90p to 105p. The stock eased 0.9%, or 0.8p, to 97p on Wednesday.

He updated his estimates following full-year 2022 results from the group last week that confirmed profit after tax will be £23m, in line with Maravanyika’s forecast, while net debt will be marginally lower. "Strix faced a challenging 2022, enduring recessionary headwinds in its key markets, Covid-19 lockdowns in China (90% of kettle controls customer original equipment manufacturers are in China), inflationary pressure, and higher finance costs. However, management is banking on an improvement in the Chinese economy in the second quarter ‘aided by the end of the hard Covid-19 policy there. In the meantime, the company is prioritising strategic measures to mitigate the impact of the downturn, particularly in the kettle controls segment." he said.

[lovewinshatelosses] 31/1/2023 20:44

Missed it, annoyingly. Was preoccupied with my PM miners today. Hope I get another bite of the cherry tomorrow, but that said, might wait until after the FED speech, evening our time. Then our own clowns are up the day after...but we will probably just copy them, so might be buying again come Thursday, prices permitting of course.

[cyberbub] 31/1/2023 14:37

There's your 96p retest, LovesWinsHatesLosses. You back in??

[masurenguy] 30/1/2023 09:53

Needs to break 100p resistance, close above it for a couple of days, then we could see the next leg up.

[cyberbub] 27/1/2023 23:20

Forward p/e of only 7 at 100p, and China problems resolving themselves. I think 150p is a perfectly reasonable target here. NAI

[masurenguy] 27/1/2023 17:02

Still struggling to close above 100p. However, a 275,000 Buy @99.97p reported just after the bell may help them to achieve that on Monday.

[lovewinshatelosses] 26/1/2023 13:42

Volatile markets, eh? Big overreaction the last couple of days to drop it just sub 90p and euphoria today taking it over a quid in half a trading day. I think the share price will push on now, but I would like to see a retest of the 96p level first. I have cashed in my chips again. Circa 10% profit in less than one day is not to be sniffed at to my mind, especially in a market like this one and happy to leave potentially plenty on the table for the next man. GLA.

[masurenguy] 26/1/2023 13:12

The shareprice breached 100p circa 10 days ago but then fell back 10%. It will be interesting to see whether it can close above 100p today and move up again tomorrow.

[lawson27] 26/1/2023 12:57

be nice to see the "Bot's" take this through 100 and upwards, GLA

[dr biotech] 26/1/2023 11:56

Decent enough update. At least things haven’t got worse. Presumably there has been some discussion with major shareholders about strategy and hence the debt reduction plan. Selling off inventory should help.

[lovewinshatelosses] 26/1/2023 09:54

Prioritising debt reduction is good business practice in this climate. I think plenty of people thought a dividend yield approaching 10% was liable to review. I certainly intimated as much on one of my first posts here. Even if the BOD bring it down to 5% or 6%, this would be ample to appeal to dividend hunters IMO. In the meantime, let's see how the share price fares on the first move to attack the 50 DMA. GLA.

[bend1pa] 26/1/2023 09:34

"the Board is currently reviewing the level of the final dividend and further details will be provided at the Preliminary Results."
======================================================

In other words it's likely to be cut. How much by is anyone's guess.

[trident5] 26/1/2023 08:43

"Strix is focused and committed to returning to its core operating model of being highly cash generative with no further M&A activity..."

Good idea - pity they diverged.

[lovewinshatelosses] 26/1/2023 08:20

Happy with the update and glad I bought some back. Looking for north of 100p now before I decide on whether to hold or take profits again. I think 234p would be somewhat optimistic in this climate - even over the next 12 months - but who knows? Certainly the current price is very cheap as far as I am concerned, but the market will decide for us! GLA.

[chrisdgb] 26/1/2023 08:16

Surely with China reopen this is a cracking bid target...?

[masurenguy] 26/1/2023 08:11

Luce is now up 67% over the past 8 weeks so doubt whether Strix can match that performance. Nevertheless we should see further improvement here with the first threshold to breach being 100p.

[brucie5] 26/1/2023 08:05

Another Luce?

[edmonda] 26/1/2023 07:44

'Headwinds diminishing' - new research and audio summary here:

The pre-close trading update for FY22 is evidence of a business determined to deliver. The focus is now on revenue generation and shorter investment payback periods. Two factors proved disruptive to activity levels in FY22; the war in Ukraine and lockdowns across China to prevent the spread of Covid-19. Although the former looks set to continue indefinitely, the re-opening of the Chinese economy represents a positive factor for FY23 onwards.

Cash levels will be boosted as the supply chain relaxes post-lockdowns, enabling the Group to reduce inventory levels, and marketing expenditure is likely to decline. Billi is integrating well into the Group following its acquisition in December, with new products launched and distributors appointed in Asia. We have left estimates unchanged for FY23 and FY24.

We reduced our dividend estimates in early December, reflecting the level of indebtedness but this still suggests a highly attractive yield of 7% for FY22, rising to 7.6% in FY23. We have left those estimates unchanged, as the c.£23m guidance for PAT and consider it too early in the year to revisit FY23 and FY24 estimates. Our net debt estimates are higher than the recent £89m guidance, although c.80% of the difference reflects the payment of deferred consideration to LAICA switching to February ’23.

Although the share price is off the lows recorded in late 2022, there remains a significant gap between the current share price and our fair value - the combination of our DCF & peer group comparison models suggest a fair value / per share of 234p, materially above yesterday's closing price.

[masurenguy] 26/1/2023 07:20

Pre-Close Trading Update and Notice of Results

Strix Group is pleased to announce a pre-close trading update for the year ended 31 December 2022.

Despite the challenging macroeconomic and geopolitical environment, Strix has achieved adjusted profit after tax for the full year of approximately £23m, which is in line with previous guidance given at the trading update on 30 November 2022. Whilst the uncertainty across a number of Strix's key export markets in Q4 remains, the disruptive effects of ongoing lockdowns being enforced in China are now beginning to show signs of abating following the recent changes in government policies and it is now anticipated that the Chinese economy will see an improvement in Q2 2023.

Strix is continuing to implement a range of strategic initiatives in order to minimise the impact of the headwinds it is facing. These include a new internal restructuring programme and a focus on the reduction of inventory in order to maximise cash generation for the Group. Following the completion of the acquisition of Billi on 30 November 2022, the integration remains on track and the Company is confident in the financial performance of the business and delivering synergies in line with expectations. Billi has a strong pipeline of orders, distributors appointed in Asia that are already starting to deliver results and further new product launches planned for Q2. Billi has a successful history of growth, with double digit CAGR over the past five years and is highly cash generative.

Strix is focused and committed to returning to its core operating model of being highly cash generative with no further M&A activity or investment into new factory builds, significantly reduced capex and working capital over the medium term. The Group's net debt(1) was £87m as at 31 December 2022. Capital allocation decisions will prioritise debt reduction with a clear plan to get net debt / EBITDA to below 2.0x during 2023 and the Board is currently reviewing the level of the final dividend and further details will be provided at the Preliminary Results. During the period, the Group also delivered against its scope 1 & 2 net zero targets ahead of its original target.

Notice of Results

The Group will announce its Preliminary Results for the year ended 31 December 2022 on 29 March.

[lovewinshatelosses] 25/1/2023 17:56

Well, against my better judgement, I could not help myself. I bought back a few that I sold the other day when we got close to the quid mark. Will ladder in a few more if we revisit that 85p level that I like. If the update is poor then it will serve me right for going against my initially sensible strategy :) GLA and here is hoping for a bullish update tomorrow.