DCC PLC Interim Management Statement (1641W)

TIDMDCC

RNS Number : 1641W

DCC PLC

07 February 2017

7 February 2017

DCC plc

Interim Management Statement

Strong Growth in Third Quarter Operating Profit and Acquisition of Esso's Retail Network in Norway

DCC plc, the international sales, marketing and business support services group, is issuing this Interim Management Statement for the third quarter ended 31 December 2016.

Third quarter ended 31 December 2016

Group operating profit for the third quarter ended 31 December 2016 was strongly ahead of the prior year and in line with expectations.

DCC Energy recorded strong growth in operating profit, benefitting from very strong organic volume growth in LPG and good organic volume growth in both Retail & Fuelcard and Oil. Heating-related volumes were in line with expectations, with the milder weather conditions in the UK offset by colder conditions elsewhere.

DCC Healthcare traded in line with expectations and the prior year, benefiting from a strong organic performance from DCC Health & Beauty Solutions, although DCC Vital was, as anticipated, impacted somewhat by the trading headwind of the weakness in sterling, particularly in pharma products.

Operating profit in DCC Technology was strongly ahead of the prior year, benefitting from the contribution from the CUC acquisition completed during the prior year and also from a strong performance from the UK and Irish business which saw good organic growth in the quarter.

DCC Environmental again delivered very strong year on year organic growth, in both Britain and Ireland.

Year to 31 March 2017

DCC continues to expect that both operating profit and adjusted earnings per share will be significantly ahead of the prior year and in line with current market consensus.

Development Activity

The year to date has been another active development period for DCC. Including the acquisition of Esso Retail Norway(1) , announced separately this morning, the Group has committed to acquisition expenditure of c. GBP430 million.

Today's announcement of DCC Energy's acquisition of Esso Retail Norway is another material step for DCC in building its retail petrol station business in Europe. The national network sells c. 600 million litres of fuel annually and is the third largest in Norway with approximately 20%(2) of retail volumes. It comprises 142 company-operated sites (127 retail service stations and 15 unmanned stations) and has contracts to supply 108 Esso-branded dealer owned stations. The total consideration will be NOK 2.43 billion (c. GBP235 million), plus the value of stock in tank at the date of acquisition, all payable in cash on completion. The acquired business, which is substantially asset backed, is expected to generate a return on invested capital employed of approximately 15% in the first full year of ownership.

The transaction is subject to customary regulatory approvals and closing conditions, including competition clearance from the Norwegian Competition Authority, and is expected to complete in the final calendar quarter of 2017.

Since the announcement of DCC's half-year results on 14 November 2016, the Group has completed the previously announced acquisitions of Hammer, Medisource and, more recently Gaz Europeén, which completed on 31 January 2017.

DCC remains ambitious to continue the growth and development of its business in existing and new geographies and retains a strong, well-funded and liquid balance sheet.

Final Results

DCC expects to announce its results for the year to 31 March 2017 on 16 May 2017.

For reference:

Tommy Breen, Chief Executive

Fergal O'Dwyer, Chief Financial Officer

Kevin Lucey, Head of Group Finance & Investor Relations

Telephone: [phone]

Email: [e-mail]

Web: www.dcc.ie

Powerscourt (Media)

Lisa Kavanagh / Victoria Palmer-Moore

Telephone: [phone]

Email: [e-mail]

About DCC plc

DCC plc is an international sales, marketing and business support services group headquartered in Dublin with operations in Britain, Continental Europe and Ireland. DCC has four divisions - DCC Energy, DCC Healthcare, DCC Technology and DCC Environmental. In its last financial year ended 31 March 2016, DCC generated revenue of GBP10.6 billion and operating profit of GBP300 million and currently employs approximately 10,500 people in 15 countries. DCC's shares are listed on the London Stock Exchange and are included in the FTSE All-Share Index and the FTSE 100 Index.

Forward-looking statements

This announcement contains some forward-looking statements that represent DCC's expectations for its business, based on current expectations about future events, which by their nature involve risk and uncertainty. DCC believes that its expectations and assumptions with respect to these forward-looking statements are reasonable, however because they involve risk and uncertainty as to future circumstances, which are in many cases beyond DCC's control, actual results or performance may differ materially from those expressed in or implied by such forward-looking statements.

(1) The separate announcement this morning regarding Esso Retail Norway contains inside information for the purposes of Regulation (EU) No. 596/2014 on Market Abuse

   (2)    Estimate based on Wood MacKenzie market data 

This information is provided by RNS

The company news service from the London Stock Exchange

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February 07, 2017 02:00 ET (07:00 GMT)