Strix Group Plc
(“Strix”, the “Group” or the “Company”)
Interim results for the six months ended 30 June 2022
Despite the challenging m acroeconomic and geopolitical environment, the Company has
delivered a robust performance across its three product categories and made progress towards medium-term targets
Financial Summary
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Adjusted results1 |
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H1 2022 |
H1 2021 |
H1 2020 |
Change (22 – 21) |
Change (22 – 20) |
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£m |
£m |
£m |
%5 |
%5 |
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Revenue |
50.7 |
54.7 |
34.7 |
-7.3% |
46.1% |
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Gross profit |
19.5 |
20.5 |
13.8 |
-4.9% |
41.3% |
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EBITDA2 |
15.9 |
17.4 |
13.6 |
-8.6% |
17.6% |
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Operating profit |
12.9 |
13.9 |
10.6 |
-7.2% |
21.7% |
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Profit before tax |
11.6 |
13.2 |
10.1 |
-12.1% |
14.9% |
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Profit after tax |
11.6 |
12.3 |
9.8 |
-5.7% |
18.4% |
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Profit after tax (excluding accounting estimates changes)3 |
10.7 |
12.3 |
9.8 |
-13.0% |
+9.2% |
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Net debt4 |
61.3 |
46.0 |
36.9 |
33.3% |
66.1% |
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Net cash generated from operating activities |
9.9 |
13.5 |
8.3 |
-26.7% |
19.3% |
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Basic earnings per share (pence) |
5.6 |
6.0 |
4.9 |
-6.7% |
14.3% |
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Diluted earnings per share (pence) |
5.5 |
5.9 |
4.9 |
-6.8% |
12.2% |
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Interim dividend per share (pence) |
2.75 |
2.75 |
2.6 |
0.0% |
5.8% |
1. Adjusted results exclude exceptional items, which include share based payment transactions, other reorganisation and strategic project costs. Adjusted results are non-GAAP metrics used by management and are not an IFRS disclosure. A table which shows both Adjusted and Reported results is included in the Chief Financial Officer's review.
2. EBITDA, which is defined as earnings before finance costs, tax, depreciation and amortisation, is a non-GAAP metric used by management and is not an IFRS disclosure.
3. Accounting estimate changes relate to the reassessment of useful lives performed in the current period of various assets within the group, particularly relating to production and development processes.
4. Net debt excludes the impact of IFRS 16 lease liabilities, pension liabilities, deferred tax liabilities and earn-out provisions on satisfaction of performance conditions.
5. Figures are calculated from the full numbers as presented in the consolidated financial statements.
Financial Highlights
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The Group reported revenue of £50.7m, a decrease of 7.3% versus the same period in prior year and an increase of 15.5% versus the same period in pre-COVID 2019 as revenues were adversely impacted by the ongoing conflict in Ukraine on certain peripheral geographies. |
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Adjusted gross profit margin was 38.5% (2021: 37.5%) driven by the Group's ability to manage costs and to flex variable overheads in line with sales performance. |
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Adjusted profit after tax was £11.6m (2021: £12.3m), representing a 5.7% decrease compared to the same period last year and an increase of 6.4% versus the comparable period in pre-COVID 2019. |
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Net debt increased to £61.3m (FY 2021: £51.2m) as a result of further drawdowns to fund net working capital, capital expenditure and employment earn-out payments. This represents a net debt/adjusted EBITDA ratio (calculated on a trailing twelve month basis) of 1.6x. |
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The Group has significant liquidity providing financial flexibility to continue to deploy capital consistent with its allocation of capital priorities and is focused on investing in compelling growth opportunities. |
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Adjusted basic earnings per share and adjusted diluted earnings per share were 5.6p (H1 2021: 6.0p) and 5.5p (H1 2021: 5.9p) respectively. |
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The Board is maintaining an interim dividend of 2.75p per share (2021: 2.75p). |
Strategic Highlights
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On track to deliver medium-term targets to double the Group's revenues primarily through growth in its water and appliances categories. |
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Successfully implemented further product price increases across the full kettle controls range and water categories (the most recent was with effect from 1 May 2022). |
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Maintained market leading market share position of 56% of the global kettle controls market by value. |
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Strong recognition for Strix domestic appliances. Aurora achieved the Quiet Mark award, Housewares' Sustainable Product of the Year and nominated for Best New Product: Small Domestic Appliance at the ERT Awards. The Visione induction kettle was awarded both the German Design Award 2022 and the Red Dot design award. |
Operational Highlights
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Production efficiency of core kettle products improved with 77% of all assembly lines now fully automated. |
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In the appliances category, there has been some promising signs of consumer market penetration of product ranges. |
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In the water category, new distribution and private label contracts have been secured with reputable distributors, retailers and brands. |
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The sustainability agenda for 2022/23 remains high on the agenda as the Company delivers on Scope 1&2 targets, analyse Scope 3 emissions and continue to focus on other KPIs. |
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New Strix.com website launched demonstrating the Company's vision of the future.
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Mark Bartlett, Chief Executive Officer of Strix Group plc, said:
“ Despite the challenging macroeconomic and geopolitical environment, Strix has delivered a robust performance across its three product categories and remains on track to deliver medium-term targets to double the Group's revenues primarily through growth in its water and appliances categories.
The macro headwinds have resulted in a reduction in demand in the kettle control category in the key export markets but offsetting this has been a recent improvement in trading conditions within China which has already started to come through. In the appliances category, there has been some promising signs of consumer market penetration of product ranges and in the water category, new distribution and private label contracts have been secured with reputable distributors, retailers and brands.
The Group remains in a strong financial position and given strength of its cash generation, the Boarddeclares an interim dividend that is in line with last year.”