Strix Group Plc (LON:KETL) has emerged from a transitional year with a much cleaner balance sheet, a stronger Consumer Goods division and a set of near-term strategic milestones that could shape how investors view the group into FY27. In its latest research note, Zeus Capital said the company’s 15-month results to 31 March 2026 were broadly in line at adjusted profit before tax level, while the market’s attention is likely to stay fixed on cash generation, division mix and the review now underway under new chief executive Andy Rainforth.
The note makes clear that the most important shift in the period came not from headline revenue, but from capital structure. The disposal of Billi generated net proceeds of £102.0m after costs and adjustments, leaving Strix with £38.7m of net cash at the period end. That compares with net debt of £64.9m at the start of the period and has also pushed annualised net interest costs to below £1.0m from about £7.5m previously. Zeus said the cash result was better than expected and may justify an upgrade to its net cash forecasts while the buyback remains paused.
Andy Hanson, the Zeus analyst on the note, said: “The strategic agenda is the next catalyst.” That framing matters because the company is now in the middle of a leadership transition and has a Capital Markets Day scheduled for later in the financial year, where management is expected to set out a strategic update and capital allocation framework.
FY26 results show a mixed trading picture
- Group revenue was £151.1m for the 15 months to 31 March 2026, or £153.2m on a CER basis, compared with Zeus’s £150.0m estimate.
- Adjusted PBT came in at £10.0m AER and £10.1m CER, at the top of the range guided in March.
- Adjusted EBITDA of £28.4m was in line with forecast, while gross margin eased to 32.9% from 37.5% in 2024.
- Operating cash conversion reached 110.8%, supported by a £2.4m working capital inflow and £7.7m of capex.
- Consumer Goods revenue rose 12.0% on a like-for-like 12-month basis, with gross margin improving by 350 basis points to 33.2%.
- Controls revenue fell 23.8% on the same basis, with gross margin down 680 basis points to 33.5%.
Consumer Goods was the clear bright spot in the period. Revenue advanced to £34.4m on a CER basis over the 12 months to March, with growth driven by appliance manufacturing for a leading global baby brand customer and higher bespoke OEM filter volumes. The division’s gross margin rose to 33.2%, reflecting a more favourable mix, and Zeus noted that momentum has carried into Q1 FY27. The report also points to strategic developments including a patent-pending PFAS filter range, the UK launch of LAICA and new automated assembly and packaging lines being installed in Italy.
Controls, by contrast, remained under pressure but moved broadly as expected after the downgrade in March. Revenue in the division fell to £52.9m on a CER basis, reflecting weaker order volumes after US tariffs prompted Chinese OEM customers to run down inventories. The margin decline was linked to the loss of high-margin volumes over a semi-fixed cost base, weaker dollar translation and continued pricing pressure from Chinese competitors. Even so, Zeus highlighted a recovery pattern from July 2025 onward, with volumes outside the China domestic market ahead of the previous year in the final quarter and into FY27.
That recovery is important because the divisional mix is being reshaped at the same time as pricing actions begin to settle in. The report says the surcharge and increase programme has now been concluded with the remaining strategic customers, which should help offset copper and silver costs. Silver has fallen materially from its earlier spike, while copper remains elevated, leaving the margin outlook for Controls dependent on how much of the cost relief can be retained.
From a financial perspective, the refinancing backdrop looks materially better than it did a year ago. The company repaid its RCF and term loan in full after the Billi sale, retained a reduced £25.0m facility for structural reasons and now has only one lender, IOM Bank via NatWest. The note says management intends to begin a refinancing process after the strategic planning exercise concludes, suggesting the current balance sheet position is less about immediate need and more about maintaining flexibility.
Strix’s share price closed at 34.3p in the note, giving a market value of £67.8m. On Zeus’s FY27E EBITDA forecast of £15.0m, the shares trade at 3.2 times EV/EBITDA, a level that leaves a lot of room for sentiment to move if the strategic review delivers a clearer route to stabilised earnings and a more consistent capital return policy. For now, the stock’s next read-across appears more likely to come from the Capital Markets Day than from another operational surprise.
