XP Power

We like XP Power because it operates in growth markets such as semiconductor manufacturing and healthcare and it supplies major blue-chip original equipment manufacturers or OEMs. Once designed into a programme or piece of equipment, XP Power has a revenue annuity over the life cycle of the customer’s product which is typically five to seven years depending on the industry sector.

Group strategy is to focus on growth through product development, customer development, supply chain enhancement and industry leadership in sustainability. The company has worked hard to reduce costs and increase efficiencies, and these measures should help improve financial returns in the years ahead.

XP Power has taken steps to reduce its carbon footprint, though its most important Scope 3 emissions, linked to the use of the products it sells, remain dependent on sales volumes.

Manufacturing electrical equipment also poses environmental risks, including the generation of hazardous waste such as heavy metals and wastewater sludge. Product safety is also relevant given the critical nature of its components.

The company’s use of so-called 3TG minerals (tin, tungsten, tantalum and gold) presents risks due to potential sourcing from conflict-affected regions. While XP Power states it does not knowingly use conflict minerals, complex supply chains make full traceability hard to achieve. Its inclusion of cobalt and mica - minerals not yet regulated – demonstrates responsible sourcing and exceeds typical practices among smaller firms.