Strix expecting 30pc revenue growth after strong start to year
Kettle safety control company Strix Group updated the company on its trading on Thursday, reporting that its improved performance in the second half of 2020 had continued through the first half of 2021 thus far.
The AIM-traded firm, which was holding its annual general meeting, said it now expected revenue growth of about 30% across the group for the year.
Chief executive officer Mark Bartlett said the kettle controls category was performing strongly, particularly within the regulated segment, with a strong order book giving it confidence for the second half and beyond.
“We have also successfully implemented price increases on some of our legacy products in both kettle controls and water categories, which alongside a range of other efficiency measures, including continued automation and strategic initiatives, has enabled us to proactively offset cost inflation,” Bartlett said.
“In the water category, the sales of new products launched were starting to accelerate, with additional product launches from Laica implemented in the first half, including the ‘GlaSSmart’ instant water filtering bottle, tap filters, and the ‘myLaica’ sports bottles.
“We are also seeing that many of the appliances created are starting to penetrate the consumer markets across the world.”
The Aurora appliance would launch on Amazon under the company’s ‘Aqua Optima’ brand in June, and a version incorporating Strix technology was recently launched, initially in Asia, with a “leading global brand”.
Bartlett said Strix’s ‘HaloPure’ technology was gaining wider market recognition, with two further contracts secured in May at a regional government-owned livestock company in China.
“This livestock company owns more than 40 farms in three provinces, which will help further promote the profile of this solution.
“Given this momentum, I am confident of securing 10 installations during the financial year, which remains in line with our previously communicated plans to commercialise this technology.”
The integration of Laica was progressing in line with the company’s plan with regards to synergies and future margin expansion, Mark Bartlett said, adding that its trading performance in 2021 had also been strong, delivering revenue growth of about 20%.
“The new manufacturing operations in China remain on target and budget to be fully operational by August as originally scheduled.
“All of the press and mould machines and 40% of the assembly lines have been moved, and the commencement of the production lines have begun.
“The group has relocated its offices in Seattle to a new location to optimise costs and provide a more appropriate environment to support the future requirements of the business as we increase our focus on driving US sales growth within the water and appliance categories.”
Bartlett said Strix remained in a “very strong” financial position to continue to deploy capital, consistent with its allocation of capital priorities, and invest in compelling growth opportunities with a focus on its new product development and commercialisation strategy.
“We are also actively seeking opportunities that will add value across the group through niche acquisitions or technologies.
“Overall, I am confident that the positive trends in current trading and momentum so far in the first half mean that we anticipate delivering revenue growth of about 30% for the group during 2021, which also underpins our confidence in achieving our medium-term target to double the group's revenues over the next five years.”
At 1230 BST, shares in Strix Group were up 0.47% at 293.37p.