DCC Reports Profit Growth in Recent Half, Announces Strategic Shift Towards Energy Sector

2 min read | November 12, 2024 08:47 AM PST | By Team Kalkine Media

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DCC Reports Profit Growth in Recent Half, Announces Strategic Shift Towards Energy Sector — Image source: shutterstock

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Highlights

Profit Growth: Group adjusted operating profit increased by 4.7%, supported by M&A activity.

Acquisition Focus: DCC commits £130 million to eight acquisitions, with emphasis on solar energy businesses in Germany and France.

Strategic Update: DCC to focus on energy, streamline operations, and enhance shareholder value.

DCC (LSE:DCC) has reported strong interim results for the six months ending 30 September 2024, alongside a new strategic shift toward the energy sector aimed at simplifying operations and maximizing shareholder value. For the period, group adjusted operating profit rose by 4.7% (6.0% at constant currency) despite currency translation challenges. Organic growth accounted for 0.5% of this increase, while mergers and acquisitions (net of divestments) contributed an additional 5.5%.

Adjusted earnings per share climbed by 6.2% (7.5% at constant currency), and the company announced an interim dividend increase of 5.0%, reaching 66.19 pence per share. The growth reflects the positive impact of recent acquisitions, particularly in the renewable energy sector.

Since its final results in May 2024, DCC has committed approximately £130 million to eight bolt-on acquisitions, with a significant portion allocated to expanding its energy footprint. The largest transactions include the acquisition of Wirsol, a solar photovoltaic (PV) and battery storage company in Germany, and Acteam ENR, a French solar PV business. These acquisitions bolster DCC’s renewable energy assets and align with its focus on sustainable growth. Additionally, DCC divested a majority stake in its liquid gas business in Hong Kong and Macau, marking a shift toward streamlining operations.

The company’s strategic update, also announced today, reveals plans to intensify its focus on the energy sector, particularly renewable energy, to drive future growth and enhance shareholder returns. DCC's CEO noted that the update reflects the company's response to evolving market demands and its ambition to lead in sustainable energy solutions.

Looking ahead, DCC remains optimistic for the fiscal year ending 31 March 2025, anticipating good operating profit growth and significant strides in executing its energy-focused strategy despite currency-related headwinds. The company’s proactive approach to acquisitions and divestments signals a strong commitment to repositioning as a leader in the energy sector, which is expected to create long-term value for shareholders.

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