Building a global future Strix

building a global future

2019 has been a watershed year for Strix, with a key US acquisition and ground broken on a major new factory in China

Strix, the world’s leading manufacturer of kettle controls, is taking a major new step in its expansion in the huge Chinese market. This year it signed an Investment Agreement with the People’s Republic of China (PLC) Government for a new factory more than twice the size of Strix’s current premises near Hong Kong. The new factory has 50 years right-of-use granted for the land and it will increase the Company’s operations and provide efficiency improvements, additional automation capability and an opportunity to insource filtration products and processes.

The land for the new plant, at Zengchen, Guangzhou, has already been bought and design work has been finalised. Construction is scheduled for completion in January 2021 with completion of the entire project the following August.

Mark Bartlett, CEO of Strix Group plc commented, “Strix has made significant progress in recent years. This has been reflected in our increasing demand around the world and the consequent need for a new factory which is more than twice the size of Strix’s current premises. Our brand-new facility will be the future of Strix, where we will develop new and exciting technologies and products that provide environmental benefits and promote sustainability. These are exciting times and we are pleased with the generous support for our project we have received and want to extend our gratitude to our constructors and contractors.”

expanding in water filtration

The news of the go-ahead for the new China factory was not, however, the only major event for Strix in 2019. In February it entered into an asset purchase agreement with HaloSource, the Seattle based water purification company. The assets acquired included HaloSource’s HaloPure division and its Astrea product.

Strix sees this acquisition as an opportunity to acquire extensively developed technology, which is complementary to its Aqua Optima division as well as gaining access to skilled research and development resources in the USA. Strix will continue the process of commercialising the technology and products that it has acquired, leveraging its experience of operating in the water filtration sector and bringing to market new consumer products. And it sees clear potential for operational synergies in China, above all in its new and larger manufacturing facility

HaloSource has two primary patented technologies – a brominebased water treatment bead system proven to kill 99.99 per cent+

of bacteria and viruses, and a composite filter material certified to remove heavy metals from water, with its main differentiator being its lead removal performance.

HaloSource has also developed a consumer product (Astrea) using its filter technology. This product is a reusable portable water bottle with changeable filters that is certified to remove lead from tap water. Lead removal is a major differentiator in the USA in particular, where a number of health scares have occurred due to lead levels in drinking water.

Astrea allows consumers to obtain filtered drinking water at a much lower cost per litre than bottled water, whilst avoiding the negative environmental impact of plastic water bottle usage. Astrea was launched in late 2018 and is available via a number of distribution channels as a subscription product including the delivery of regular replacement filters.

Mark Bartlett commented: “We are very pleased to be adding to our technology and product portfolios through this acquisition of value adding assets. We maintain that the USA is a key geography for us, and this transaction offers us a stronger presence in this market. As well as bringing additional customer and supplier relationships, we see the opportunity to provide increased differentiation to further expand our filtration division.”

Driving thermostat technology

Strix Group Plc is a global leader in the design, manufacture and supply of kettle safety controls and other components and devices involving water heating and temperature control, steam management and water filtration.

To date, Strix has sold over 1.9 billion units, and management estimate that Strix safety controls are used over 1 billion times per day by consumers, in more than 100 countries, and by over 10 per cent. of the world’s population.

The Isle-of-Man headquartered company was established in 1982 by John Taylor to carry on the pioneering work of Castletown Thermostats, the business his father Eric Taylor had founded to develop the revolutionary thermostat technology that he had invented during the Second World War to control the heated flying suits worn by bomber crews at high altitudes.

By 1998 Strix had become the world market leader for the supply of controls to the domestic water boiling appliances market and in 2009 it celebrated the production of one billion controls. In 2013 it launched its baby formula maker, a diversification that addressed what it saw as previously unmet consumer needs.

expanding the offer

Today enhancing its kettle control offering remains a key focus for Strix with the global kettle market currently valued at retail at around GBP3 billion and projected to expand by around 15 per cent over the next three years.

But Hot Water on Demand (HWoD) is now also a key element in the company’s offering. HWoD is a natural extension to the Strix

core business and is currently valued at retail at over GBP2.4 billion globally. The market is growing fast thanks to consumers’ increasing need for convenience, speed, and energy efficiency.

Strix has recently implemented a successful collaboration with the USA’s Mr Coffee in the launch for a quality coffee machine and has further expanded its business in China with Zwilling Brand’s launch of the patented IFH “true boil” technology.

Strix also plans to expand from a UK to an international footprint in the Baby Care category, focusing on solutions which offer enhanced convenience and safety. Agreement has already been reached with a leading Asian Baby care brand to launch a range of products in 2020. The Global Baby Care category is valued at retail at over GBP150 Billion

Strix’s Water Filtration business had up till this year been limited to the UK market but, with the acquisition of HaloSource, it now plans to leverage its existing technologies and new acquisitions to drive aggressive growth in key global markets. By the end of 2021 its aim is to launch 16 new products including filters, jugs, bottles and appliances. Strix has also secured a global partnership agreement enabling the Astrea product to be distributed under the Philips brand outside North America. n