Well set to double revenue in five years
Strix yesterday reported 2% growth YoY in adjusted profit after tax for its year ended 31 December 2020. As expected, there was a ‘marked recovery’ in H2 and that improvement seems to be continuing into 2021 with some seasonal uplift in Q4. There is also the benefit of some healthy order book visibility for Q121, which should underpin investor confidence on the FY21 outlook. In the current year Strix will also consolidate a full year of performance from LAICA, acquired in October 2020.Strix’s share price has now more than doubled from the lows in March 2020, as investors noted its COVID resilience, income attractions, commitment to ESG best practice and scope for further growth. There has been a material, but deserved, rerating - so on ED forecasts Strix shares trade on 16.4x PE 2020 and 15.3x PE 2021; 14.1x EV/EBITDA 2020, and 12.9x EV/EBITDA 2021.
We are confident that these ratings can expand further as investor awareness grows of the ‘new’ Strix equity growth story.
The previously mentioned plans to double Group revenues over the next five years, highlighted at their recent November Capital Markets Day, as well as a comprehensive ESG and sustainability strategy, will be key drivers in delivering growth and ongoing consumer demand for their products. In addition, for investors starved of income, the dividend yield is an attractive 3%.
Strix Group is a holding company. Through its subsidiaries, Co. is engaged in the designing, manufacturing and supply of kettle safety controls and other components and devices involving water heating and temperature control, steam management and water filtration. Co.'s core products are kettle safety controls, which are responsible for disconnecting the power to the heating element when either water has boiled, operated with no water present, or in some products when the kettle is lifted off its base.
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