DCC sees strong growth in first half of the year

DCC, a fuel distribution-to-technology services group, said it saw strong growth in the first half of the year despite ongoing challenges from the global economy.

Operating profit rose by 13 per cent to £221.2 million (€253.5m) in the period ended September 30th, as DCC Energy showed strong organic growth and the acquisition of Almo boosted DCC Technology. Adjusted earnings per share were more than 9 per cent higher at 146.4 pence per share.

DCC said its interim dividend had increased 7.5 per cent to 60.04 pence per share.

The first half of the year is seasonally less significant for the group. However, DCC said the performance was strong despite the challenges presented by global commodity prices and the macroeconomic environment.

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The period under review saw a number of acquisitions, including the completion of the Medi-Globe deal by DCC Healthcare, its largest acquisition to date and one that significantly expands DCC Vital’s presence in medical devices. Other acquisitions include DCC Energy’s purchase of solar panel distributor PVO, renewable and heating solution provider Protech, and air source heat pump distributor Freedom Heat Pumps.

“DCC reported strong growth in the seasonally less significant first half of our financial year. The group continued to perform well in a volatile and challenging environment, reflecting our resilient business model and strong market positions,” said chief executive Donal Murphy.

“We made good progress in delivering our priorities for the allocation of capital. During the period we committed approximately £300 million to acquisitions in the healthcare and energy services and renewables sectors. The acquisitions in the period are consistent with our aim to build a material position in the European healthcare sector and ensuring we are leading the decarbonisation of our energy customers. Our priorities are consistent with the growth opportunities we see in our chosen sectors of energy, healthcare and technology, and we continue to see substantial opportunity in these sectors.”

Looking ahead, DCC expects that the full year, which ends March 31st, 2023, will be another year of profit growth.

“DCC’s strong results reflect positive trading in all of its divisions but also reflects a period of very active acquisitions and expansion across the energy, medical and technology sectors, which have supported the company’s progress in the last half year’s profits,” said Richard Flood, investment manager at wealth manager RBC Brewin Dolphin.