Strix Share Discussion Threads

[salchow] 21/3/2019 08:13

"Good set of results and dividend increased by 141%!"

Or in line with the 7p dividend for the year that was promised!

[masurenguy] 21/3/2019 07:48

Good set of results and dividend increased by 141%!

RNS Number : 5046T
21 March 2019
Strix Group Plc

Results for the year ended 31 December 2018

Strix Group Plc (AIM: KETL), is pleased to announce its audited results for the year ended 31 December 2018.

Financial summary


Adjusted results(1)
------------------------
2018 2017 Change
------ ------ --------
GBPm GBPm %(4)
Revenue 93.8 91.3 +2.7%
Revenue - constant currency
basis(2) 95.3 91.3 +4.5%
EBITDA(3) 36.4 35.1 +3.5%
Gross profit 38.9 37.2 +4.6%
Operating profit 30.9 29.1 +6.2%
Profit before tax 29.2 28.3 +3.2%
Profit after tax 28.3 27.5 +2.7%
Net debt 27.5 45.9 +40.1%
Net cash generated from operating
activities 35.0 33.8 +3.4%
Basic earnings per share 14.9p 14.5p +2.8%
Final dividend per share 4.7p 1.9p +147.4%

2018 in summary

Financial highlights

-- Solid performance during 2018 including a 7.9% growth in sales volumes and 2.7% in net sales, rising to 4.5% on a constant currency basis, in line with expectations.
--Careful cost management has allowed us to report a gross profit margin of 41.5% (2017: 40.7%).
--Net debt reduced to GBP27.5m, a 40.1% reduction since December 2017 (GBP45.9m).
--OCF / EBITDA cash conversion ratio of 89.4% (2017: 88.0%).
--Proposed final dividend of 4.7p, with total dividends of 7.0p or the full year.

Operational highlights

-- 2.7m U9 series products sold to date following the successful launch in 2017.
-- A further eight successful Intellectual Property protection initiatives undertaken, the highest number of cases concluded in any one year.
-- Further growth in Aqua Optima has led to a volume share of c.25% of the UK market for own-brand and trade-brand combined.
-- Continued focus on manufacturing and production quality led to an 11% improvement in ppm.

Strategic highlights

-- Maintained market share of c.38% of the global kettle controls market despite geo-political events.
-- Appointment of a Chief Commercial Officer from 1 April 2019 and further strengthening of the R&D and senior management teams.
-- After the period end, completed acquisition of specified assets from HaloSource Corporation for consideration of US$1.33m in March 2019 to expand the water filtration division.
-- Investment agreement signed with the local government for the relocation of our manufacturing operation in China to support
future growth.

Mark Bartlett, CEO of Strix Group Plc, commented: "We are pleased to report a solid year of trading for Strix in 2018. We continued to make encouraging progress with our strategic priorities which enabled us to maintain our global market share of around 38% amidst a challenging geo-political climate. Aqua Optima has continued to show strong growth and we secured a market share within the UK of 25%. We also launched the Aqua Optima Water Filter Recycling Initiative, which allows consumers of Aqua Optima filtration systems to recycle their products from home or at hundreds of TerraCycle collecting locations across the UK.

We saw positive progress on the U9 series of controls and since its launch in 2017 we have sold nearly 3 million units. With this in mind, we have entered 2019 with the most diversified product portfolio Strix has had to date, providing access to all global markets. Intellectual property protection remains a key focus of the business to ensure defence of our technology and products in order to maintain the value of our brand. In 2018, we concluded the highest number of cases in any one year and we continue to monitor the market for copyists and ensure that consumers, our customers and our brand are protected. We have continued to focus on manufacturing and production quality which has led to an 11% improvement in ppm, and we are continuing to invest in automation to further improve production efficiency and quality.

The Board are delighted to announce a proposed final dividend of 4.7p, equating to a total dividend of 7.0p per share for 2018. We look forward to the year ahead and remain confident about our full year outlook for 2019."

[edmonda] 21/3/2019 07:43

Update on results now published from Equity Development:

[alter ego] 08/2/2019 15:05

just a bit confused as to the need for HaloSource shareholders approval if they aren't getting any of the proceeds, as posted by trident5 (173 above)

[squidsgone] 08/2/2019 14:28

Intellectual Property assets would be my guess, interested to see how they account for that if it is.

[ryesloan] 08/2/2019 11:34

That's not entirely accurate re buying the business the RNS states 'specified assets' being purchased. Halo also states that Strix will buy 'the majority of the company's assets' so it's not being purchased as a going concern (as clearly it's not and is bust!).Essentially then they are asset stripping a business that is in liquidation and will simply absorb those assets into Strix.

[rogerbridge] 07/2/2019 17:49

I do not know much about Halo, but they must have some part of the business or IP that is of interest. Filtration methods could change in the future as graphene membranes become commonplace.
Strip is a well run business and I can not see them investing unless they were certain of making a return.

[trident5] 07/2/2019 08:32

HaloSource Corporation (HAL.LN, HALO.LN), the global clean water technology company, announces that it has received an offer from Strix Group Plc to acquire the majority of the Company's assets for approximately US$1.3 million in cash, (the "Disposal"), including an advance of funds to the Company for working capital purposes of approximately $0.1 million by way of an unsecured promissory note. Cash received from completion of the Disposal will be used to pay the Company's creditors. It is not expected any payment will be made to its shareholders.

The Disposal remains subject to, inter alia, the satisfactory completion of due diligence, agreement of legal documentation, including the detailed list of assets subject to the offer, and HaloSource shareholders' approval.

[trident5] 07/2/2019 08:31

They are buying the business Pugugly.
It was chugging through c£10m a year - not sure whether its revenue/cost profile will continue in Strix's hands which could be a drag or whether it was reaching commercial viability just at the point everyone else gave up on it.

[masurenguy] 07/2/2019 08:19

I think that Mark Bartlett is a fairly shrewd guy and he also has a Chinese COO and CFO on board !

[pugugly] 07/2/2019 08:12

Masurenguy - Very much depends what assets they are purchasing - HALO is a Woodford disaster - Although in an area of great potential Halo management have presided over a slowly moving landslide - If you hold possibly pop round and have a word with Strix management to exercise exhaustive DD on the quality of the assets and their existence (especially in China) I am sure they will as very shrewd cookies living on the windswept but pleasant and safe isle on which to be domiciled.

[masurenguy] 07/2/2019 07:56

Interesting move! The UK arm of Halosource, listed on AIM, is currently under suspension "while their financial position is clarified". Obviously Strix sees some potential synergistic product potential here.

RNS Number : 3094P
Strix Group PLC
07 February 2019

Proposed Acquisition

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 it has made an offer, subject to certain conditions, to acquire specified assets from HaloSource Corporation ("Halosource") for approximately $1.3m in cash.

Halosource is a clean water technology company, admitted to trading on AIM, with operations in the US and China. Strix has offered to acquire certain US and Chinese assets which will assist in accelerating its strategy to expand and grow its water filtration division. The acquisition is subject, amongst other things, to the negotiation of mutually acceptable legal documentation and the approval of HaloSource shareholders. Strix will make a further announcement in due course.

[rogerbridge] 06/2/2019 13:51

Bought in earlier for the SIPP, Well run company, IP protected, leader in it's field, lowering debt and good dividend.

[sphere25] 06/2/2019 10:46

Some tidy buying coming here with 464k and 432k buys at 153. That's unusual so I have followed those in.

In light of the recent strong trading update and particularly the emphasis and confidence in strong cash flows supporting the 7p dividend, looking for a retest of the highs at 170.

[srichardson8] 23/1/2019 16:55

Net debt has decreased since 31 December 2017 to £37.9m (2017: £45.9m) as a result of using surplus funds to make debt repayments (Interim unaudited figures to June 18 released Sept 18)
The Board also expects to report a net debt position of c.£28 million.(that is to Dec 18, from yesterday's trading update).
This continues a remarkable strengthening of the balance sheet based on decent cashflow.There is still a net equity deficit - this basically implies nil or minus value to the company's assets - but by this time next year this should also be looking much better.
I am much encouraged.

[edmonda] 23/1/2019 11:40

Still sitting on a near 5% yield which is 2x covered, and benefiting from brisk 7% core kettle safety category growth, and on a 9x 2019 PER. At some point reservations will melt away - a rerating is overdue

[masurenguy] 22/1/2019 10:51

Topped up this morning after todays update with solid progress, a forward PE of just under 10, a dividend yield over 4.5%, positive cashflow, net debt down by a third and good defensive qualities.

[trident5] 22/1/2019 09:28

Steady update but not very exciting.
Aqua Optima sales are growing strongly - but total only about £6m a year. Otherwise no growth in market share.

Debt coming down quickly - but once it's down they'll need to start investing in a new factory.

Doesn't seem to be a catalyst other than price to cash flow.

[masurenguy] 22/1/2019 08:55

Peel Hunt Analyst Andrew Shepherd-Barron retained his ‘buy’ recommendation and target price of 202p.

He said it was ‘unusual to find a global market leader with a long track record of high margins, trading on a free cashflow yield of 9% to 10%, and with a dividend yield of at least 5%’. Although future capital expenditure would be higher than originally expected, the company was ‘sufficiently well covered to pay both the dividend and a significant reduction in debt’. Shepherd-Barron said the company should be ‘well valued’ and although ‘growth is hindered by price deflation and by the negative mix effect of the best growth being in the lowest priced markets, this is more than reflected in a rating of 10 times full-year 2019 earnings’. Citywire

[masurenguy] 22/1/2019 08:39

Good pre-close update this morning !

"Strix has delivered a strong performance across the Group during 2018 and the Board confirms that it expects to report results in line with market expectations for the financial year. The Board also expects to report a net debt position of c.£28m.

Whilst 2018 has seen significant volatility caused by geo-political events including Brexit, USA/China and USA/Turkey trade tensions, the global kettle market still posted growth of c.7% with strong progress in North America, Russia and South East Asia offsetting softening in Europe, the UK and Turkey. During the period, the Group maintained its global market leading share of the kettle controls market at c.38% by volume with the U9 series of controls supporting growth in less regulated markets and ongoing strong performance in the USA offsetting a slight softening within the China domestic market.

The Group's Aqua Optima brand has experienced another strong year of growth following a re-positioning of the brand in the UK market and an increased presence at multiple retailers. The brand has entered into new collaborations, including with Parkrun and TerraCycle, in order to further increase consumer reach and brand recognition. As a result, Aqua Optima has increased its combined brand and private label volume share to over 25% of the UK market. The Board continues to search for new differentiated technologies to enhance the product portfolio in Aqua Optima to drive future growth and support expansion outside of the UK.

The Group has continued to progress the relocation of our manufacturing operations in China in the second half of the year. An appropriate site has now been identified near our existing facility and the Group is in the process of finalising an agreement to purchase the land with the local government in the district in which the site is located. The Board anticipates factory construction will begin in the second half of 2019 and will take approximately two years to complete. A further update and guidance will be given with the full year results.

Further successful Intellectual Property protection initiatives have also been undertaken to both enforce the Group's patent rights and, where they have expired, utilise other legal redress such as copyright to take legal action against those that seek to copy its products in order to protect the Group's revenue streams. The Group will continue to vigorously defend its patent position to ensure that consumers, its customers and its brand are protected.

Given the Group's performance in 2018 and the Board's confidence in the continued strength of its cash generation, the Board re-confirms its intention to pay total dividends of 7.0p per share in respect of the 2018 financial year, inclusive of the 2.3p per share paid as an interim dividend."

[rahman07] 10/1/2019 21:15

It is the good one

[mrnumpty] 30/12/2018 10:34

Obviously , the Sun Tel article is in the edition of 30/12/2018 ( not the 39th !!! Predictive texting ! )

[mrnumpty] 30/12/2018 10:30

Holders will be interested to learn that there is a half-page article in today's Sunday Telegraph ( Sunday 39/12/2018 , page 8 of theBusiness and Money section ) .its an interview with Dr John C Taylor , the founder of Strix . It's not an investment analysis , but recounts his business career . I'm not a holder of Strix , but it's tipped by Simon Thomson of the Investors' Chronicle . The article should be interesting for holders ( by the way - the Telegraph weirdly seems to think there are / were polar bears in Latvia ! ) . Good luck all .

[masurenguy] 13/12/2018 11:06

Another legal victory in China to protect patents. These are important developments to sustain future sales and profits.

RNS Number : 1662K
Strix Group PLC
12 December 2018

Further Successful Patent and IP Protection

Strix Group Plc (AIM: KETL), the AIM listed global leader in the design, manufacture and supply of kettle safety controls and other complementary water temperature management components, is pleased to provide an update on its intellectual property protection initiatives. Building on successes announced earlier in the year whereby Strix was able to both enforce its patent rights and, where they have expired, utilise other legal redress such as copyright to take legal action against those that seek to copy its products, Strix is pleased to report the following recent developments:

[edmonda] 13/12/2018 09:38

Latest update on Strix's IP and safety control actions here: