Strix Group (KETL) H2 2023 earnings summary

Executive summary

• 2023 revenue rose 35.2% to £144.6m, largely driven by the full-year contribution from Billi; adjusted PAT fell 12.7% to £20.1m.

• Core Kettle Controls retained stable market share by value; 2024 priorities include business rebasing, debt reduction and selective investment to support medium-term growth.

Financial highlights

• Revenue was £144.6m in 2023 versus £106.9m in 2022; adjusted PAT was £20.1m, down 12.7% YoY.

• Adjusted gross margin was 39.6%, up 80bps YoY; adjusted EBITDA was £32.1m, with margin down 270bps.

• Net debt declined £3.7m to £83.7m; operating cash flow conversion was 83.7%.

• Gross debt fell from £117.8m to £103.7m, supported by quarterly Billi term-loan amortisation; working capital reduced £2.3m.

Outlook and guidance

• 2024 guidance: adjusting items ~£4m, effective tax rate 12–13%, capex including capitalised development ~£12m, depreciation and amortisation ~£9m, and net interest and finance charges ~£9m.

• Net debt / EBITDA is forecast below 2.0x by end-2024; average gross debt is expected to decline to £98m from £112m in 2023.

• Dividend payments are paused in 2024; a sustainable payout ratio of 30% of adjusted PAT is planned for 2025.

• Net debt leverage is targeted at ~1.5x by end-2025, with ongoing leverage appetite of 1.0x–2.0x and no further acquisitions planned.