Strix trading update: revenue £64.6m, net debt £70.3m, and leverage at 2.5x
Strix Group has served up a meaty trading update alongside news of a CEO transition. The headline numbers for the six months to 30 September 2025 (note the new year-end to 31 March 2026) are revenue of £64.6 million, net debt of £70.3 million (as defined in its banking facility), and net debt leverage of 2.5x.
These are the baseline comparators for upcoming periods after the year-end change. The company says trading is broadly in line with market expectations for the period to 31 March 2026, assuming the recent improvement in Controls keeps building.
| Period/Item | Figure |
|---|---|
| Revenue (6 months to 30 Sep 2025) | £64.6m |
| Net debt (banking definition) | £70.3m |
| Net debt leverage | 2.5x |
| Target net debt leverage | c.1.5x in 12–18 months |
| Inventory reduction targeted (H2 of current period) | c.£8m |
| Debtor reduction via non-recourse factoring | c.£2m |
| Billi loan amortisation | £14m per annum ended with final payment on 28 Nov 2025 |
| FY24 final dividend | Cancelled (was due Dec 2025) |
| CEO transition date | 29 May 2026 |
Controls division: tariff headwinds easing, early signs of recovery
The Controls division had a rough Q2 2025 thanks to indirect tariff impacts and a weaker US dollar, but conditions stabilised in Q3 and early conversations at the Canton Fair point to improvement continuing into Q4. Management expects the recovery to build into Q1 2026, even as activity in South Africa, Turkey and the US remains softer than hoped.
To defend share and widen its addressable market, Strix has launched “Low-Cost” and “Next Generation” controls at lower price points. That is a sensible two-pronged response: protect the core from copyists while opening up new segments. The company notes higher copyist activity and says it is taking several actions to protect its products and IP (intellectual property).
Billi and Consumer Goods: growth engines still humming
Billi continues to be the bright spot, delivering double-digit growth at constant exchange rates and progressing its geographic rollout. The new, enlarged manufacturing HQ in Australia is now operational – useful capacity and a sign of confidence in the pipeline.
Consumer Goods, which was restructured last year, has returned to growth. Production in China for a leading global baby brand is being rolled out and new products launched as planned. The small domestic appliance market remains volatile, but the division has been busy on operations and innovation to broaden the range and strengthen competitiveness.
Debt reduction plan: inventory, factoring, dividend cancellation, and the Billi loan milestone
Strix has accelerated its debt reduction programme over the past two months. The big actions:
- Restructuring production volumes at its China factory to cut inventory by around £8 million over the last six months of the current financial period.
- Extending non-recourse debt factoring in Italy to lower average debtor balances by around £2 million. Non-recourse factoring is where receivables are sold to a finance provider without recourse, improving cash flow and reducing credit risk.
- Cancelling the final dividend proposed for FY24, which was due in December 2025, to prioritise deleveraging.
On top of that, the final payment on the Billi acquisition loan will be made on 28 November 2025. That ends the £14 million per annum amortisation the Group has been paying for the last three years, freeing cash to bring down revolving credit facility (RCF) borrowings faster.
The Board is also assessing a variety of operational and corporate actions to enhance stakeholder value and further accelerate debt reduction, all while maintaining constructive dialogue with lenders. The target is to bring net debt leverage down to around 1.5x within 12–18 months.
Why this matters for investors
- Balance sheet direction of travel is positive. Moving from 2.5x to c.1.5x net debt leverage would materially de-risk the equity and reduce interest costs, assuming trading holds up.
- Cash flow inflection point. The end of the £14m p.a. Billi amortisation should boost cash generation in 2026, supporting the deleveraging plan.
- Dividend trade-off. Cancelling the FY24 final dividend will disappoint income seekers, but it accelerates the path to a stronger balance sheet. Whether and when dividends resume is not disclosed.
CEO transition: Mark Bartlett to step down; search underway
After nearly twenty years at Strix and a decade as CEO, Mark Bartlett will step down by mutual agreement on 29 May 2026. Chairman Gary Lamb will lead the search for a new chief executive, with an update to follow in due course.
Leadership transitions can add uncertainty, but the long notice period gives ample time to manage the handover. The strategy – defend Controls, scale Billi, keep Consumer Goods on its growth track, and deleverage – remains intact based on today’s messaging.
My take: a pragmatic reset with cautious green shoots
This update reads like a pragmatic reset. Strix is leaning into cash, cutting inventory, pulling forward receivables, and shelving the dividend to speed up deleveraging. Ending the Billi amortisation is a clear win for cash flow. The 1.5x leverage target in 12–18 months looks achievable if Controls continues to recover and Billi sustains double-digit momentum.
On the flip side, the Controls division still faces competitive pressure from copyists and patchy demand in some markets. Currency and tariff sensitivities remain live issues. The CEO change adds a variable, even with a structured process.
Key risks and what to watch next
- Controls recovery trajectory: The Board’s “in line” view hinges on October-November momentum continuing into Q4 and Q1 2026. Watch for order trends and pricing in Controls.
- Copyist activity and IP protection: Any step-up in enforcement or product differentiation would be a positive signal.
- Working capital execution: Delivering the c.£8m inventory reduction and maintaining tighter debtors post-factoring will be key to cash generation.
- Billi growth durability: Double-digit growth at constant exchange rates is strong; the new Australian facility should help fulfil demand.
- Dividend policy: Not disclosed beyond the FY24 cancellation. Any future distributions will likely follow clear progress on the 1.5x leverage target.
Quick jargon buster
- RNS: The official channel for UK-listed companies to release price-sensitive news.
- Net debt leverage: Net debt divided by EBITDA (profit measure). Lower is safer.
- Non-recourse factoring: Selling invoices to a finance firm without recourse, improving cash and reducing credit risk on those receivables.
- Constant exchange rate growth: Growth adjusted to remove currency movements.
- RCF: Revolving credit facility – a flexible loan that can be drawn down and repaid as needed.
Bottom line
Strix is tightening the screws on cash and gearing while nudging the Controls engine back towards growth and letting Billi do the heavy lifting. The dividend cut stings, but the payoff could be a stronger balance sheet and lower financing costs. Execution over the next two quarters – especially in Controls and working capital – will decide how quickly that 1.5x leverage target comes into view.
