Strix delivered strong financials with 25% increase in revenues however, a challenging operating environment due to increases in commodity prices, freight cost inflation, supply chain and fluctuating foreign exchange rates hurt investor sentiment.
The hydro product and service company, Strix shares dropped 9% to 217p on late afternoon trade on Wednesday.
Strix saw 25% rise in revenue as it grew from £95m to £119m in 2021. The strong growth in the group’s revenue came from the acquisition of LAICA producing strong results and the kettle controls contributing £85m of the total amount.
Kettle controls increased revenue by 6.6% to £85.1m. Strix has expanded both geographically and in terms of the number of features it offers.
The regulated segment grew in the first half of 2021, thanks to significant contributions from the United Kingdom, Mainland Europe, and North America.
Water category generated revenues of £21m, almost £10m higher than 2020 due to LAICA and HaloPure technology expanding the product base for the company.
The water catergory also noted significant development in APAC, Europe, and North America, owing to new distribution and private label agreements with prominent distributors, retailers, and brands in those countries.
The appliance division saw revenues increase from £3.7m to £12.8m as Strix launched Aurora and Dual Flo in October 2021.
The launch of these products provided an extension to Strix’s domestic appliance category, with ‘strong energy saving and sustainability benefits’ progressing the company’s aim for its customers to live a greener and safer life.
The company saw pre-tax profits increase by 4.2% from £30.9m to £32.2m in 2021.
The group’s net debt rose 37.6% to £51.2m from £37.2m in 2020 in order to fund the acquistion of LAICA, further invest in new manufacturing operations in China and seeking growth opportunities.
New manufacturing operations in Guangzhou’s Zengcheng district are now up and running, after being completed on time within budget, and during a global pandemic.
Net cash generated from operating activities declined 28.5% to £22.3 from £31.2 in 2021 however, the search for growth opportunities remains unhindered as Strix has significant liquidity and financial flexibility.
Adjusted EPS increased from 14.9p in 2020 to 15.2p.
The board proposed total dividend to increase from 7.85p to 8.35p as final dividend changes to 5.6p from 5.25p in 2021.
Mark Bartlett, Chief Executive Officer, Strix Group, said, “Strix has a robust business model and disciplined execution of our strategies have underpinned the resilience of our performance throughout economic cycles, so we remain confident in our ability to navigate the growing uncertainties ahead and delivering on the medium-term strategic plan and delivering against its targets.”