Annual Report and Accounts 2014

 

Financial Review

Despite the challenge of a mild winter, the Group had a good year with revenue increasing by 6.2%, operating profits increasing 11.5%, adjusted earnings per share increasing by 11.7%, operating cash flow increasing to £349 million, free cash flow (before interest and tax payments) increasing to £278 million and a cash conversion ratio of 133%.

This Financial Review provides an overview of the Group’s financial performance for the year ended 31 March 2014 and of the Group’s financial position at that date.

Table 1: Performance Metrics

 

2014

2013

 

 

Growth:

 

Operating profit* growth (%)

11.5%

27.5%**

Volume growth - DCC Energy (%)

6.1%

21.8%

Revenue growth - excl. DCC Energy (%)

21.4%

19.4%**

Operating profit margin % - excl. DCC Energy (%)

3.3%

3.3%

Adjusted earnings per share growth (%)

11.7%

32.6%

 

 

Return:

 

Return on average capital employed (%)

16.3%

15.6%

Operating cash flow (£’m)

348.7

264.6

Working capital days (days)

(0.6)

2.2

Debtor days (days)

31.4

36.9

Free cash flow (before interest and tax payments)

278.1

207.1

Conversion of operating profits to free cash flow (%)

133.4%

110.9%

 

 

Financial Strength/Liquidity/Financial Capacity for Development

 

EBIT:net interest (times)

9.7

13.3

EBITDA:net interest (times)

12.4

17.1

Cash balances (net of overdrafts) (£’m)

814.6

431.1

Net debt (£’m)

86.3

186.0

Net debt as a % of total equity (%)

9.1%

20.8%

Net debt:EBITDA (times)

0.3

0.7

 

 

* Excluding exceptionals and amortisation of intangible assets

** Based on continuing activities i.e. excluding DCC Technology’s Enterprise distribution business which was disposed of in June 2012

Overview of Results+-

2014

2013

Change on prior year

 

£’m

£’m

%

 

 

 

 

Revenue

11,231.7

10,572.7

+6.2%

 

 

Operating profit

 

DCC Energy

110.5

106.2

+4.0%

DCC Technology

48.1

41.5

+15.9%

DCC Healthcare

30.4

22.2

+36.9%

DCC Environmental

11.7

10.9

+7.8%

DCC Food & Beverage

7.7

6.1

+25.9%

Group operating profit

208.4

186.9

+11.5%

Finance costs (net)

(21.4)

(14.1)

 

Profit before exceptional items, amortisation of intangible assets and tax

187.0

172.8

+8.2%

Amortisation of intangible assets

(20.4)

(14.4)

 

Exceptional charge (net)

(15.4)

(25.5)

 

Profit before tax

151.2

132.9

+13.7%

Taxation

(27.3)

(26.3)

 

Non-controlling interests

(2.7)

(0.3)

 

Net earnings

121.2

106.3

+14.1%

Adjusted earnings per share (pence)

191.2

171.2

+11.7%

 

 

Revenue+-

Revenue increased by 6.2% to £11.2 billion driven by acquisitions, particularly in DCC Energy, and excellent organic growth in DCC Technology. DCC Energy increased its sales volumes by 6.1% driven by acquisitions, with organic volumes decreasing by 3.0% primarily due to the impact of a very mild winter. Excluding DCC Energy, Group revenue was 21.4% ahead of the prior year. Most of this growth was organic and was driven by the growth in DCC Technology, particularly in Britain.

Operating Profit+-

Group operating profit increased by 11.5%. Approximately half of this growth was organic, primarily reflecting excellent growth in DCC Technology in Britain and in DCC Healthcare’s health and beauty activities.

Operating profit in DCC Energy, the Group’s largest division, was 4.0% ahead of the prior year. This growth reflected the successful integration of acquisitions completed in prior years and cost efficiency initiatives, offset to some extent by the impact on volumes and margins of the very mild weather conditions across Northern Europe, particularly in the months from December 2013 to February 2014 when average temperatures were well above the 10 year average.

Operating profit in DCC Technology, the Group’s second largest division, was strongly (15.9%) ahead of the prior year primarily based on very strong organic growth in mobile computing and communications products in Britain.

Table 2: Revenue

2014

2013

Change

H1

H2

FY

H1

H2

FY

H1

H2

FY

£’m

£’m

£’m

£’m

£’m

£’m

%

%

%

DCC Energy

4,093.4

4,150.3

8,243.7

3,827.6

4,284.6

8,112.2

+6.9%

-3.1%

+1.6%

DCC Technology

959.2

1,304.8

2,264.0

742.8

1,107.4

1,850.2

+29.1%

+17.8%

+22.4%

DCC Healthcare

195.1

211.4

406.5

150.7

169.9

320.6

+29.5%

+24.4%

+26.8%

DCC Environmental

64.9

65.7

130.6

58.2

57.9

116.1

+11.5%

+13.6%

+12.5%

DCC Food & Beverage

107.3

79.6

186.9

96.9

76.7

173.6

+10.8%

+3.8%

+7.7%

Total

5,419.9

5,811.8

11,231.7

4,876.2

5,696.5

10,572.7

+11.1%

+2.0%

+6.2%

Weighting %

48.3%

51.7%

100.0%

46.1%

53.9%

100.0%

Table 3: Operating Profit

 

2014

2013

Change

 

H1

H2

FY

H1

H2

FY

H1

H2

FY

 

£’m

£’m

£’m

£’m

£’m

£’m

%

%

%

 

 

 

 

DCC Energy

33.5

77.0

110.5

18.9

87.3

106.2

+77.8%

-11.9%

+4.0%

DCC Technology

14.1

34.0

48.1

12.7

28.8

41.5

+10.9%

+18.2%

+15.9%

DCC Healthcare

12.6

17.8

30.4

9.7

12.5

22.2

+29.3%

+42.9 %

+36.9%

DCC Environmental

6.3

5.4

11.7

6.3

4.6

10.9

+0.2%

+18.2%

+7.8%

DCC Food & Beverage

2.9

4.8

7.7

2.7

3.4

6.1

+7.0%

+40.6%

+25.9%

Total

69.4

139.0

208.4

50.3

136.6

186.9

+38.0%

+1.8%

+11.5%

Weighting %

33.3%

66.7%

100.0%

26.9%

73.1%

100.0%

 

 

 

 

 

 

 

Operating profit in DCC Healthcare was substantially (36.9%) ahead of the prior year, benefitting from the acquisition of Kent Pharma, which was completed in February 2013 and from a very strong performance in DCC Health & Beauty Solutions.

DCC Environmental and DCC Food & Beverage, DCC’s two smaller divisions, traded ahead of the prior year as early signs of economic recovery became evident in Britain and Ireland.

Although DCC’s operating margin on a continuing basis (excluding exceptionals) was 1.9%, compared to 1.8% in 2013, it is important to note that this measurement of the overall Group margin is of limited relevance due to the influence of changes in oil product costs on the percentage. While changes in oil product costs will change percentage operating margins, this has little relevance in the downstream energy market in which DCC Energy operates, where profitability is driven by absolute contribution per litre (or tonne) of product sold and not by a percentage margin. Excluding DCC Energy, the operating margin on a continuing basis (excluding exceptionals) for the Group’s other divisions was 3.3% (3.3% in 2013), with some of the sales growth in DCC Technology being at relatively lower margins.

An analysis of the performance for the first half, the second half and the full year ended 31 March 2014 is set out in Tables 2 and 3.

A detailed review of the operating performance of each of DCC’s divisions is set out on this page.

The compound growth rate in DCC’s operating profits over the last 20,15,10 and 5 years is as follows:

 

CAGR %

20 years (i.e. since 1994)

13.4%

15 years (i.e. since 1999)

12.3%

10 years (i.e. since 2004)

11.4%

5 years (i.e. since 2009)

6.9%

Reconciliation of Adjusted Earnings to Profit Attributable to Shareholders+-

 

2014

£’m

2013

£’m

Change on prior year

Adjusted earnings

160.2

143.1

+11.9%

Amortisation of intangible assets after tax

(16.3)

(11.3)

 

Non-trading items after tax and minority interests

(22.7)

(25.5)

 

Profit attributable to shareholders

121.2

106.3

+14.1%

 

pence

pence

 

Adjusted EPS

191.20

171.20

+11.7%

Amortisation of intangible assets after tax

(19.38)

(13.56)

 

Non-trading items after tax

(27.12)

(30.47)

 

Basic EPS

144.70

127.17

+13.8%

 

 

Finance Costs (net)+-

Net finance costs increased to £21.4 million (2013: £14.1 million) primarily as a result of the incremental interest cost of the US Private Placement debt drawn down in April 2013 and higher average net debt during the year of £366 million compared to £279 million in the prior year. The increase in average net debt arose primarily from seasonal increases in working capital in DCC Technology, as a result of the significant organic increase in its revenue. Interest was covered 12.4 times by Group operating profit before depreciation and amortisation of intangible assets (17.1 times in 2013).

Profit before Net Exceptional Items, Amortisation of Intangible Assets
and Tax+-

Profit before net exceptional items, amortisation of intangible assets and tax increased by 8.2% to £187.0 million.

Net Exceptional Charge and Amortisation of Intangible Assets+-

The Group incurred a net exceptional charge before tax and non-controlling interests of £15.4 million as follows:

 

£’m

 

Restructuring costs

19.7

Acquisition and related costs

5.6

Mark to market loss

2.1

Gain arising from legal claim

(7.0)

Gain on disposal of non core activities

(5.3)

Write back of deferred and

contingent acquisition consideration

less asset impairments

(1.7)

Other (net)

2.0

Total

15.4

 

The Group incurred an exceptional charge of £19.7 million in relation to restructuring of acquired and existing businesses. Most of this related to the costs of integration of previously acquired oil and LPG businesses, the relocation of DCC Healthcare’s Swedish health and beauty manufacturing activities to Britain, which was planned for at the time of the acquisition of those assets, and the closure of DCC Technology’s Irish DVD business.

Acquisition and related costs include the professional and tax costs (such as stamp duty) relating to the evaluation and completion of acquisition opportunities. During the year, acquisition and related costs amounted to £5.6 million.

Most of the Group’s debt has been raised in the US Private Placement market and swapped, using long term interest, currency and cross currency derivatives, to both fixed and floating rate sterling and euro. The level of ineffectiveness calculated under IAS 39 on the fair value and cash flow hedge relationships relating to fixed rate debt, together with gains or losses arising from marking to market swaps not designated as hedges offset by foreign exchange translation gains or losses on the related fixed rate debt, is charged or credited as an exceptional item. In the year to 31 March 2014 this amounted to a total exceptional loss of £2.1 million.

In January 2004, the High Court in London awarded £12.2 million in damages and associated interim costs, together with interest, to DCC’s former British based mobility and rehabilitation subsidiary for breach of an exclusive supply agreement by a Taiwanese supplier. A further amount in respect of costs of £2.9 million was subsequently determined by the High Court to be payable. In order to enforce the High Court judgments, it has been necessary to pursue the collection of all outstanding amounts through the Taiwanese courts. In March 2012, DCC received the initial £12.2 million referred to above which was accounted for in DCC’s financial year ended 31 March 2012. In December 2013 and January 2014 a further aggregate amount of £7.0 million was recovered in respect of the accumulated interest on the £12.2 million from which there was a deduction of £5.3 million for Taiwanese withholding tax which is being challenged by DCC. The recovery of the £2.9 million, plus interest, continues to be pursued through the Taiwanese courts. DCC has not accrued the amount of this outstanding claim.

In March 2014, DCC Healthcare disposed of a small US based subsidiary which contract manufactures a range of mattress covers for hospital beds and stretchers and in February 2014 DCC Food & Beverage disposed of part of its chilled and frozen food distribution activities. The business activities disposed of accounted for less than 1% of DCC’s operating profit for the year ended 31 March 2014. The net cash inflow from these transactions was £11.1 million and resulted in a gain on disposal (before a non-controlling interest charge) on their book carrying values of £5.3 million.

There was a non cash credit of £16.2 million for deferred and contingent acquisition consideration over provided in previous years. This non-cash credit was offset by a non-cash charge of £14.5 million for the impairment of subsidiary goodwill and a property asset.

There was a tax charge of £5.3 million, as referred to above, for Taiwanese withholding tax, which is being challenged by DCC and a non-controlling interest charge of £2.1 million relating to these exceptional items. The cash impact in the year of exceptional charges relating to the year to 31 March 2014 and the prior year was £21.1 million.

Profit Before Tax+-

Profit before tax increased by 13.7% to £151.2 million.

Taxation+-

The effective tax rate for the Group was 14% compared to 17% in the prior year.

Adjusted Earnings Per Share+-

Adjusted earnings per share increased by 11.7% to 191.20 pence. The compound annual growth rate in DCC’s adjusted earnings per share over the last 20,15,10 and 5 years is as follows:

 

CAGR %

 

20 years (i.e. since 1994)

12.3%

15 years (i.e. since 1999)

11.4%

10 years (i.e. since 2004)

10.0%

5 years (i.e. since 2009)

6.5%

 

 

Dividend+-

The Board is recommending a final dividend of 50.73 pence per share, which when added to the interim dividend of 26.12 pence per share, gives a total dividend for the year of 76.85 pence per share. This represents a 10% increase over the total prior year dividend of 69.86 pence per share (85.68 cent per share translated at the average euro/sterling exchange rate for the year ended 31 March 2013 of £0.815 = €1). The dividend is covered 2.5 times by adjusted earnings per share (2.5 times in 2013). It is proposed to pay the final dividend on 24 July 2014 to shareholders on the register at the close of business on 30 May 2014. Over the last 20 years, DCC has an unbroken record of dividend growth at a compound annual growth rate of 14.9%.

Return on Capital Employed+-

The creation of shareholder value through the delivery of consistent, long term returns well in excess of the cost of capital is one of DCC’s core strategic aims. Return on capital employed increased from 15.6% to 16.3% driven primarily by the increase in the Group’s operating profit and strong working capital management. The reduction in return on capital employed in DCC Energy arose as a result of the impact on operating profit of the mild winter.

Table 4: Return on Capital Employed

 

2014

ROCE

2013

ROCE

 

 

DCC Energy

17.5%

18.5%

DCC Technology

21.1%

16.4%

DCC Healthcare

14.2%

13.1%

DCC Environmental

8.6%

8.3%

DCC Food & Beverage

11.8%

9.5%

Group

16.3%

15.6%

 

 

Cash Flow+-

The Group generated excellent operating and free cash flow during the year, as summarised in Table 5.

Table 5: Summary of Cash Flows

 

2014

2013

 

£’m

£’m

 

 

 

Operating profit

208.4

186.9

Decrease in working capital

86.9

28.2

Depreciation and other

53.4

49.5

 

Operating cash flow

348.7

264.6

Capital expenditure (net)

(70.6)

(57.5)

 

Free cash flow (before interest and tax payments)

278.1

207.1

Interest and tax paid

(53.0)

(45.6)

 

Free cash flow

225.1

161.5

Acquisitions

(50.1)

(168.2)

Disposals

11.1

11.7

Dividends

(62.1)

(54.7)

Exceptional items

(21.1)

(25.2)

Share issues

2.0

1.7

 

Net outflow

104.9

(73.2)

Opening net debt

(186.0)

(106.9)

Translation

(5.2)

(5.9)

 

Closing net debt

(86.3)

(186.0)

 

Operating cash flow in 2014 was £348.7 million compared to £264.6 million in 2013. Working capital was reduced by £86.9 million with overall working capital days improving by 2.8 days. Working capital improvements were achieved across all of the Group’s divisions with overall Group debtor days reducing from 36.9 days to 31.4 days. The primary driver of the improvement was a reduction in debtor days in DCC Energy and DCC Technology. DCC Technology selectively uses supply chain financing solutions to sell on a non-recourse basis, a portion of the receivables relating to certain larger supply chain/sales and marketing activities, thereby mitigating the impact of the higher levels of inventories that are required to affect this business. This accounted for 3.3 days of the reduction in Group debtor days and having regard to the related higher inventory levels, the net impact on the Group net working capital days was a reduction of 1.0 day (or £30 million).

After capital expenditure of £70.6 million (2013: £57.5 million) free cash flow before interest and tax payments amounted to £278.1 million compared to £207.1 million in the prior year. After interest and tax payments of £53.0 million (2013: £45.6 million) the net cash generated by the Group was £225.1 million compared to £161.5 million in the prior year.

Net capital expenditure in the year of £70.6 million (2013: £57.5 million) compares to a depreciation charge of £56.1 million (2013: £54.2 million).

The increase in capital expenditure over the prior year was driven primarily by ongoing investment in upgrading truck and depot infrastructure in DCC Energy, particularly in the oil business in Britain.

With a cash impact of acquisitions in the year of £50.1 million and dividend payments of £62.1 million, there was an overall net inflow of £104.9 million in the year, leaving net debt at 31 March 2014 at £86.3 million (31 March 2013: £186.0 million).

The conversion rate of operating profits to free cash flow (i.e. operating cash flow less capital expenditure but before interest and tax payments) is an important measure as to how the

Group’s operating profits translate into cash flow.

The Group has a high conversion rate which is summarised on a 1, 5, 10 and 20 year basis as follows:

 

1 Year

5 Years

10 Years

20 Years

 

£‘m

£‘m

£‘m

£‘m

 

 

 

 

 

Operating profit

208

891

1,476

1,968

Operating cash flow

349

1,302

1,968

2,595

Free cash flow*

278

1,029

1,510

1,959

Cash conversion %

133%

116%

102%

100%

*Operating cash flow less capital expenditure



Balance Sheet and Group Financing+-

DCC’s financial position remains very strong, well-funded and highly liquid. At 31 March 2014 the Group had net debt of £86 million and total equity of £946 million. In late March 2014, the Group arranged committed US Private Placement market funding of $750 million (£451 million) with maturity terms of seven, ten, twelve and fifteen years (average maturity of ten years) which will be drawn down in May 2014 (£403.4 million) and September 2014 (£48 million). This committed funding, together with available cash resources and committed bank term facilities, ensures that the Group retains significant financial capacity to support its future growth. Pending deployment of these funds on acquisitions and future debt repayments, the funds raised add to DCC’s cash resources and increase the average maturity on the Group’s debt to nearly eight years with an average credit spread over euribor/libor of 1.66%. The Group will incur an annual interest holding cost on this incremental debt until it is deployed on scheduled debt repayments and acquisition and development opportunities.

The Group’s pro-forma funding and liquidity position at 31 March 2014 is summarised in Table 6. This table adjusts the Group’s net debt at 31 March 2014 for the above fund raising of £451.4 million, US Private Placement debt maturing in the year to 31 March 2015 of £181.9 million and the acquisition of Qstar for £40 million which was completed in early May 2014.

Key financial ratios as of 31 March 2014, including the principal financial covenants included in the Group’s various lending agreements, are as follows:

 

2014

Actual

2013

Actual

Lender

Covenants

 

 

 

 

Net debt: EBITDA

0.3

0.7

3.5

EBITDA:net interest

12.4

17.1

3.0

EBIT:net interest

9.7

13.3

3.0

Total equity (£’m)

946.3

892.3

425.0

 

 

 

The recent debt fundraising, together with available cash resources and committed bank term loan facilities, ensures that the Group retains significant financial capacity to support its future growth and development plans.

Table 6: Summary of Net Debt at 31 March 2014

 

At

31 March 2014

Committed net fundraising & acquisitions

Pro-forma

 

£’m

£’m

£’m

 

 

 

 

Cash and short term bank deposits

963.1

229.5

1,192.6

Overdrafts

(148.6)

-

(148.6)

Cash and cash equivalents

814.5

229.5

1,044.0

 

Bank debt repayable within 1 year

(0.5)

-

(0.5)

US Private Placement debt repayable:

Y/e 31/3/2015

(181.9)

181.9

-

Y/e 31/3/2016

(12.9)

-

(12.9)

Y/e 31/3/2017

(93.9)

-

(93.9)

Y/e 31/3/2018

(47.0)

-

(47.0)

Y/e 31/3/2020

(180.2)

-

(180.2)

Y/e 31/3/2021

(50.1)

-

(50.1)

Y/e 31/3/2022

(37.4)

(93.0)

(130.4)

Y/e 31/3/2024

(218.2)

-

(218.2)

Y/e 31/3/2025

-

(257.6)

(257.6)

Y/e 31/3/2026

(74.5)

-

(74.5)

Y/e 31/3/2027

-

(84.2)

(84.2)

Y/e 31/3/2030

-

(16.9)

(16.9)

Other miscellaneous debt

(4.2)

0.3

(3.9)

Debt

(900.8)

(269.5)

(1,170.3)

 

Net debt

(86.3)

(40.0)

(126.3)

 

Further analysis of DCC’s cash, debt and financial instrument balances at 31 March 2014 is set out in notes 27 to 30 in the financial statements.

Financial Risk Management+-

Group financial risk management is governed by policies and guidelines which are reviewed and approved annually by the Board of Directors. These policies and guidelines primarily cover foreign exchange risk, commodity price risk, credit risk, liquidity risk and interest rate risk. The principal objective of these policies and guidelines is the minimisation of financial risk at reasonable cost. The Group does not trade in financial instruments nor does it enter into any leveraged derivative transactions. DCC’s Group Treasury function centrally manages the Group’s funding and liquidity requirements. Divisional and subsidiary management, in conjunction with Group Treasury, manage foreign exchange and commodity price exposures within approved policies and guidelines. Further detail in relation to the Group’s financial risk management and its derivative financial instrument position is contained in note 46 to the financial statements.

Foreign Exchange Risk Management+-

DCC’s presentation currency is sterling. Exposures to other currencies, principally euro and the US dollar, arise in the course of ordinary trading.

A proportion of the Group’s profits and net assets are denominated in euro. The sterling/euro exchange rate strengthened by 2.1% from 0.8456 at 31 March 2013 to 0.8282 at 31 March 2014. However the average sterling/euro exchange rate at which the Group translates its euro denominated operating profits weakened by 3.5% from 0.8154 in 2013 to 0.8441 in 2014.

Approximately 14% of the Group’s operating profit for the year ended 31 March 2014 was denominated in currencies other than sterling, primarily the euro. DCC does not hedge the translation exposure on the profits of non-sterling subsidiaries on the basis and to the extent that they are not intended to be repatriated. The 3.5% weakening in the average translation rate of sterling, referred to above, positively impacted the Group’s reported operating profit in a very modest way (£0.9 million) in the year ended 31 March 2014.

DCC has investments in non-sterling, primarily euro denominated, operations which are cash generative and cash generated from these operations is reinvested in development activities rather than being repatriated into sterling. The Group seeks to manage the resultant foreign currency translation risk through borrowings denominated in or swapped (utilising currency swaps or cross currency interest rate swaps) into the relevant currency, although this hedge is offset by the strong ongoing cash flow generated from the Group’s non-sterling operations, leaving DCC with a net investment in non-sterling assets. The 2.1% strengthening in the value of sterling against the euro during the year ended 31 March 2014, referred to above, was the main element of the translation loss of £7.6 million arising on the translation of DCC’s non-sterling denominated net asset position at 31 March 2014 as set out in the Group Statement of Comprehensive Income in the financial statements.

Where sales or purchases are invoiced in other than the local currency and there is not a natural hedge with other activities within the Group, DCC generally hedges between 50% and 90% of those transactions for the subsequent two months.

Commodity Price Risk Management+-

The Group is exposed to commodity cost price risk in its oil distribution and LPG businesses. Market dynamics are such that these commodity cost price movements are immediately reflected in oil commodity sales prices and, within a short period, in LPG commodity sales prices and in the resale prices of recycled oil products. Fixed price oil supply contracts are occasionally provided to certain customers for periods of less than one year. To manage this exposure, the Group enters into matching forward commodity contracts which are designated as hedges under IAS 39. The Group hedges a proportion of its anticipated LPG commodity exposure, with such transactions qualifying as ‘highly probable’ forecast transactions for IAS 39 hedge accounting purposes. In addition, to cover certain customer segments for which it is commercially beneficial to avoid price increases, a proportion of LPG commodity price and related foreign exchange exposure is hedged. All commodity hedging counterparties are approved by the Chief Executive and Chief Financial Officer and reviewed by the Board.

Credit Risk Management+-

DCC transacts with a variety of high credit rated financial institutions for the purpose of placing deposits and entering into derivative contracts. The Group actively monitors its credit exposure to each counterparty to ensure compliance with limits approved by the Board.

Interest Rate Risk and Debt/Liquidity Management+-

DCC maintains a strong balance sheet with long-term debt funding and cash balances with deposit maturities up to three months. In addition, the Group maintains both committed and uncommitted credit lines with its relationship banks. DCC borrows at both fixed and floating rates of interest. At 31 March 2014, 91% of the Group’s drawn fixed rate borrowings were swapped to floating interest rates, using interest rate and cross currency interest rate swaps which qualify for fair value hedge accounting under IAS 39. 75% of the fixed rate US Private Placement debt which was committed in March 2014 was similarly swapped to floating interest rates. The Group mitigates interest rate risk on its borrowings by matching, to the extent possible, the maturity of its cash balances with the interest rate reset periods on the swaps related to its borrowings.

Investor Relations+-

DCC’s senior management team are committed to interacting with the international financial community to ensure a full understanding of DCC’s strategic plans and its performance against those plans. With the cancellation of DCC’s listing on the Irish Stock Exchange, and its inclusion in the FTSE All-Share Index and the FTSE 250 in June 2013, DCC stepped up its investor relations efforts in order to increase the awareness of DCC among the international equity investor community. In particular DCC commenced a process to attract additional broker analyst coverage in the UK and there are now 12 analysts covering DCC, including eight in the UK and four in Ireland. During the year, the executive management presented at six capital market conferences, conducted 176 institutional investor one-on-one and group meetings and presented to 16 broking firms.

For the Group’s debt investors, in February 2014 the executive management presented a 'Deal' road show in London, Continental Europe and the US to 53 of its existing and potential debt holders, which culminated in the successful £451 million ($750 million) fundraising referred to above.

Share Price and Market Capitalisation+-

The Company’s shares traded in the range £22.45 to £32.89 during the year. The share price at 31 March 2014 was £32.60 (28 March 2013: £22.70) giving a market capitalisation of £2.73 billion (2013: £1.90 billion). Based on the Company’s share price at 31 March 2014, total shareholder return since the Group’s flotation in May 1994 was 2,970%.