Dcc Plc · LSE:DCC
Dcc — H1 FY2015 Earnings Presentation
37 slides from Dcc's earnings presentation, November 2014
Slide 1: Interim Results for the six months ended 30 September 2014
Interim Results for the six months Company Overview Presentation ended 30 September 2014
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an invitation to underwrite, subscribe for or otherwise acquire or dispose of any shares or other securities of DCC plc (“DCC”). This presentation contains some forward-looking statements that represent DCC’s expectations for its business, based on cu
Slide 3: Financial & Operational Highlights
Financial & Operational Highlights - Six months ended 30 September 2014 Interim results reflect the continued successful delivery of the strategy: Results for the period: • Operating profit up 6.4% to £73.2 million in the seasonally less significant first half • DCC Energy’s operating profit modestl
Slide 4: Highlights
Highlights - Six months ended 30 September 2014 2014 2013** % change £’m £’m Revenue 5,514.4 5,409.7 +1.9% Operating profit* 73.2 68.8 +6.4% Profit before net exceptional items, 60.3 58.4 +3.1% amortisation of intangibles and tax Adjusted EPS* 62.53 pence 58.34 pence +7.2% Dividend per share 28.73 p
Slide 5: Business Overview: divisional results
Business Overview: divisional results - Six months ended 30 September 2014 By Division 2014 2013 % change 10%4% £’m £’m 43% 22% Operating profit* 21% DCC Energy 31.9 33.5 -4.7% DCC Energy DCC Technology DCC Healthcare DCC Environmental DCC Technology 15.2 14.1 +7.7% DCC Food & Beverage DCC Healthcar
Slide 6: Acquisition & Capital Expenditure - £184.2m
Acquisition & Capital Expenditure - £184.2m - Six months ended 30 September 2014 Acquisitions Capex Total £’m £’m £’m DCC Energy 85.4 23.5 108.9 DCC Technology 15.5 5.3 20.8 DCC Healthcare 44.6 2.8 47.4 DCC Environmental - 4.4 4.4 DCC Food & Beverage 2.4 0.3 2.7 Total 147.9 36.3 184.2 6
Slide 7: DCC Energy
DCC Energy 2014 2013 % change Volume (Litres) 5.215bn 4.950bn +5.3% Revenue £4,077.0m £4,093.4m -0.4% Operating profit £31.9m £33.5m -4.7% 5.2 billion litres of product sold: volumes +5.3% driven by acquisitions – organically flat Operating profit was 4.7% behind the prior year - impacted by the ver
Slide 8: DCC Technology
DCC Technology 2014 2013 % change Revenue £1,037.9m £959.3m +8.2% Operating profit £15.2m £14.1m +7.7% Operating margin 1.5% 1.5% Operating profit growth of 7.7% in the first half - good growth across the business Revenue Split UK and Ireland • Maintained position as the leading distributor of IT, m
Slide 9: DCC Healthcare
DCC Healthcare 2014 2013* % change* Revenue £236.9m £189.1m +25.3% Operating profit £15.9m £11.7m +35.8% Operating margin 6.7% 6.2% * Adjusted to exclude Virtus Inc which was disposed of in March 2014 Operating profit growth of 35.8%, benefiting from acquisitions and strong organic profit growth in
Slide 10: DCC Environmental / DCC Food & Beverage
DCC Environmental / DCC Food & Beverage Revenue Split DCC Environmental 2014 2013 % change Revenue £73.6m £64.9m +13.3% Operating profit £7.1m £6.3m +11.7% 42% 58% Operating margin 9.6% 9.7% DCC Environmental: Operating profit increased by 11.7% on the prior year • Well positioned to benefit from im
Slide 11: Revenue/Gross Margin/Operating Costs
Revenue/Gross Margin/Operating Costs 2014 Change 2014 Change 2014 Revenue Gross Operating (£m) Margin costs (£m) DCC Energy 4,077 -0.4% 4.20ppl -0.20ppl 187 Group excl. DCC Energy 1,437 +9.2% 12.4% +0.3% 137 Total 5,514 +1.9% 324 • Energy volumes up 5.3% (flat organically) • Average selling price do
Slide 12: Summary Group P&L/ Operating Cash Flow
Summary Group P&L/ Operating Cash Flow 2014 2013 Change Change (£m) (£m) (£m) (%) Operating Profit 73 69 +4 +6.4% Finance Costs (13) (11) +3 Profit before net exceptional items, 60 58 +2 +3.1% amortisation of intangible assets and tax Effective Tax Rate 13% 16% Operating Cash Flow 18 110 (92) • Excl
Slide 13: DCC's Strategy
DCC’s Strategy Our Objective: To continue to build a growing, sustainable and cash generative business which consistently provides returns on total capital employed significantly ahead of its cost of capital Our strategic priorities: • Creating and sustaining leading positions in each of the markets
Slide 14: Outlook for year to 31 March 2015
Outlook for year to 31 March 2015 Following the particularly mild weather conditions in September and October, the Group now expects that the year to 31 March 2015 will show growth in operating profit and adjusted earnings per share in the range of 5% - 10% over the prior year (previously approximat
Slide 15: The strategy continues to deliver results for the long term
The strategy continues to deliver results for the long term Strong operating profit growth (£’m) Consistent dividend growth (pence) 76.9 208 69.9 187 187 63.5 20 year CAGR 60.5 20 year CAGR 157 55.0 13.6% 147 151 14.9% 10 year CAGR 136 10 year CAGR 50.8 11.8% 13.1% 46.2 5 year CAGR 5 year CAGR 7.8%
Slide 16: Appendix: Company Overview Presentation
Appendix: Company Overview Presentation 16
Slide 17: DCC
DCC DCC is an international sales, marketing, distribution and business support services group operating across five divisions Profit by division* Profit by geography* DCC Energy 4% 11% 6% DCC Technology UK 14% 13% Continental Europe DCC Healthcare 53% ROI 23% DCC Environmental 76% DCC Food & Bevera
Slide 18: Long History of EPS Growth
Long History of EPS Growth... EPS (£ pence) 191.2 20 year CAGR * 173.1 171.2 157.9 12.3% 139.7 142.0 10 year CAGR 10.0% 115.9 5 year CAGR 97.5 6.5% 78.4 84.5 73.6 64.9 58.3 50.4 41.9 37.7 29.9 32.3 25.9 18.8 22.1 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20
Slide 19: Strong Cash Flow Generation which Supports Development Activities
…with Strong Cash Flow Generation which Supports Development Activities 20 Year • Free cash flow of £2.0bn 1 April 1994 – 31 March 14 £m CAGR • Free cash flow* conversion of 100% and Operating profit 1,968 13.2% CAGR of 14.0% Decrease in working capital 112 Depreciation 554 • Revenue increased from
Slide 20: Consistent Dividend Growth
...along with Consistent Dividend Growth Dividend Growth (pence sterling) 76.9 69.9 20 year CAGR * 63.5 14.9% 60.5 55.0 10 year CAGR 50.8 13.1% 46.2 40.2 5 year CAGR 35.0 8.3% 30.4 26.4 23.0 20.0 17.2 14.4 12.0 9.9 7.2 8.3 5.2 6.4 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Slide 21: DCC's Strategy
DCC’s Strategy Our Objective: To continue to build a growing, sustainable and cash generative business which consistently provides returns on total capital employed significantly ahead of its cost of capital Our strategic priorities: • Creating and sustaining leading positions in each of the markets
Slide 22: Leading Market Positions
Leading Market Positions Division Market Positions • # 1 oil distributor in Britain with 18% of the market (the next largest competitor has c. 3%) • # 1 independent oil distributor in Sweden (18% market share) • # 2 oil distributor in Denmark (12% market share) and Austria (12% market share) DCC Ene
Slide 23: Acquisitions
Acquisitions Cash spent on acquisitions By Division 180 169 160 Energy, £658m 144 137 140 4% 7% Technology, £184m 120 109 15% 100 Healthcare, £166m 86 £m 83 80 72 58% 66 64 16% Environmental, £83m 60 50 48 45 40 31 Food & Beverage, 21 20 £45m 11 0 15 Year Total: £1.1 bn • Spent £1.3bn on acquisition
Slide 24: The Business: By Division
The Business: By Division 24
Slide 25: DCC Energy
DCC Energy (53% of FY 2014 Group Profit) DCC Energy is the leading oil and liquefied petroleum gas (“LPG”) sales, marketing and FY 2014 distribution business in Europe Revenue £8,243.7m • Oil for transport, heating and industrial / agricultural processes Operating profit £110.5m • LPG for heating, c
Slide 26: DCC Energy – Business of Scale
DCC Energy – Business of Scale Market Geography Volume Market Share Position Business Statistics (FY 2014) Britain – oil c. 6,350mL c. 18% – oil #1 Britain – LPG c. 260kT c. 28% – LPG #2 c. 12.5 billion Litres Volumes (pro forma annualised including Ireland – oil c. 900mL c. 11% – oil #5 acquisition
Slide 27: DCC Energy – vision & strategy
DCC Energy – vision & strategy DCC Energy’s vision is to be a global leader in the sales, marketing Volumes and distribution of fuels and related products and the provision of (Billion litres) services to energy consumers: 9.6 10.2 7.1 7.9 Oil 6.2 • Continue to consolidate existing markets to drive
Slide 28: DCC Technology
DCC Technology (23% of FY 2014 Group Profit) FY 2014 Leading route-to-market partner for global consumer Revenue £2,264m and SME technology brands Operating profit £48.1m ROCE 21.1% DCC Technology operates under the brand 12,000+ 350 industry In the home customers Consumer & leading SME In the offic
Slide 29: Technology Distribution – Integral part of the supply chain
Technology Distribution – Integral part of the supply chain Technology distribution represents c. 22% of the global ICT market Allows suppliers to concentrate on core activities including product development and end user marketing How delivers value for partners: – for Suppliers • Ability to m
Slide 30: DCC Technology – leading route to market partner
DCC Technology – leading route to market partner Products Market Computing (including PC's, servers, tablets) Market DCC Technology Geography Position Communications 17% 33% Britain No. 2 7% Printers, consumables Ireland No. 1 and IT peripherals • In the home France No. 7 11% • In the office Gaming
Slide 31: DCC Technology – vision & strategy
DCC Technology – vision & strategy Operating Profit (£m) DCC Technology’s vision is to be the leading European route 5 Yr. CAGR 10.6% to market and supply chain partner for global consumer and 48.1 SME technology brands 41.6 41.5 36.2 • Delivering an industry-leading service offering 32.7 • Generati
Slide 32: DCC Healthcare overview
DCC Healthcare overview (14% of FY 2014 Group Profit) FY 2014 Sales, marketing and distribution of Revenue £406.5m pharmaceuticals and medical devices Operating profit £30.4m and provision of services to health & beauty ROCE 14.2% brand owners Operating Profit (£m) 5 Yr. CAGR 19.1% • Well positioned
Slide 33: DCC Healthcare overview – Our Business
DCC Healthcare overview – Our Business Revenue Split • Most comprehensive sales & distribution FY 2014 network for pharmaceuticals and medical devices in Britain and Ireland, including • #1 in hospital supplies in Ireland 29% DCC Vital • #1 in GP supplies in Britain DCC H&BS 71% • One of Europe’s le
Slide 34: DCC Healthcare – vision & strategy
DCC Healthcare – vision & strategy DCC Healthcare’s vision is to build a substantial European healthcare business principally focused on sales, marketing and distribution of pharmaceuticals and medical devices and provision of services to health & beauty sector brand owners • With strong local marke
Slide 35: DCC Environmental – our business
DCC Environmental – our business (6% of FY 2014 Group Profit) FY 2014 Geography Market Position Revenue £130.6m # 1 hazardous waste management Operating profit £11.7m Ireland business ROCE 8.6% A leading recycling, waste management Revenue Split and resource recovery business – market leading positi
Slide 36: DCC Environmental – vision & strategy
DCC Environmental – vision & strategy DCC Environmental’s vision is to continue to build on its market position as one of the leading providers of recycling, Operating Profit (£m) waste management and resource recovery services in Britain 5 Yr. CAGR 6.6% and Ireland 12.3 11.7 Strategy 10.9 9.9 • Pos
Slide 37: DCC Food & Beverage – our business
DCC Food & Beverage* – our business (4% of FY 2014 Group Profit) Category Market Position FY 2014 Healthy Foods # 1 in ambient healthy foods in ROI Revenue £186.9m Operating profit £7.7m # 1 independent wine distributor in Ireland Wine ROCE Strong position in off trade in UK 11.8% Operating Profit L