Strix Group PLC Pre-Close Trading Update (6900N)

TIDMKETL

RNS Number : 6900N

Strix Group PLC

22 January 2019

22 January 2019

Strix Group Plc

("Strix" or the "Group")

Pre-Close Trading Update

Another solid performance with strong cashflow driving lower Net Debt

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 announce the following trading update for the year ended 31 December 2018.

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.GBP28 million.

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.

The Group will be announcing its results for the year ended 31 December 2018 on Thursday 21 March 2019. An analyst briefing will be held on the day in the City of London. Analysts interested in attending should contact [e-mail] or [phone].

Mark Bartlett, Chief Executive Officer, said:

"Strix has achieved another strong performance in line with market expectations. In particular, cashflow generation has been strong which has helped achieve an improved net debt figure, ahead of market expectations.

"We have maintained our strong global market position in the face of a competitive market environment, and have been largely unaffected by the uncertainty caused by Brexit and US trade tariffs as a result of our diverse global presence. We have also taken appropriate actions to mitigate future supply risks.

"As a result, we look forward to the year ahead with confidence and have put in place the foundations to achieve our objectives for 2019."

Enquiries:

 
 Strix Group Plc                             [phone] 
 Mark Bartlett, CEO 
  Raudres Wong, CFO 
 
 Zeus Capital Limited (Nominated Advisor 
  and Joint Broker)                          [phone] 
 Nick Cowles / Jamie Peel / Jordan Warburton (Corporate Finance) 
 
   Canaccord Genuity Limited (Joint 
   Broker)                                     [phone] 
 Chris Connors / Michael Reynolds 
 
 IFC Advisory Limited (Financial PR 
  and IR)                                    [phone] 
 Graham Herring / Tim Metcalfe / Heather 
  Armstrong 
 
 

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 listed on the Alternative Investment Market of the London Stock Exchange (AIM: KETL).

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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January 22, 2019 02:00 ET (07:00 GMT)