Energy and distribution group DCC has confirmed that it will cancel its stock exchange listing from the Irish Stock Exchange (ISE) in order to seek admission to the FTSE UK Index Series. It is expected that inclusion in this series will likely “increase awareness of DCC among the international investor community”.
The stock, which is currently traded on both the ISE and the London Stock Exchange (LSE), will cease its Irish listing on May 3rd, and after this date it will only be traded in sterling on the LSE. It is anticipated that DCC will be included in the FTSE All-Share Index and the FTSE 250 from June 24th.
The group is the latest in a line of Irish companies, which includes United Drug and Greencore, who have deserted the Irish exchange. Index heavyweight CRH, has also moved its primary listing to London.
According to DCC, the decision to stop trading in Ireland was taken for reasons including the increasing internationalisation of its operations, “with a majority of DCC's revenue and profit now derived from the UK and development activity focused on the UK and continental Europe, and the consequent reduction in the proportion of DCC's revenue and profit earned in Ireland”.
“These changes to our listing arrangements, index eligibility and reporting currency are a natural progression for DCC given the internationalisation of DCC's operations and shareholder base over the last number of years,” said Tommy Breen, chief executive, adding, “We also believe these changes will help increase awareness of DCC among the international investor community”.
In response, the ISE issued a statement this morning rejecting "any suggestion that trading and listing on the ISE limits a company's ability to attract international investment".
It said that DCC has achieved a 77 per cent international institutional investor base from its current listing arrangements and by having the majority of its trading on the ISE (83 per cent) compared to the LSE (17 per cent).
"Evidence also indicates that Irish companies with a dual listing arrangement have a more diverse international base than companies with a solo listing," the exchange said.
DCC will remain incorporated, headquartered and tax resident in Ireland, and according to Mr Breen, the change will have “no impact on the business operations of DCC”.
The move also means that the group will present its results in sterling as of its next financial year, which starts on April 1st. According to the board of the group, this will “help to provide a clearer understanding of DCC's financial performance by more closely reflecting the profile of its operations. Given the current composition of the group's activities, this change is expected to reduce the impact of currency movements on reported results”.
The group’s preliminary results for the year ending March 31st will be released on May 14th, and will be the last set of results reported in euro. The final dividend for the year ending March 31st will be declared in euro, and while subsequent dividends will be denominated in sterling, shareholders will have the option of receiving their dividends in either sterling or euro.
