Annual Report and Accounts 2014



Our Objective

To build a growing, sustainable and cash generative business which consistently provides returns on capital employed significantly ahead of its cost of capital.

Successful delivery of this objective will result in:

  • the creation of shareholder value through cash generation and share price growth;
  • enhanced levels of customer service;
  • strengthening of the relationship with our suppliers;
  • increased employment and development opportunities for all our employees; and
  • positively impacting on the wider communities in which we operate.




How we
did in 2014

Creating and sustaining leading positions in each of the markets in which we operate.

DCC aims to be the number 1 or 2 operator in each of its markets. This is achieved through a consistent focus on increasing market shares organically and via value enhancing acquisitions. DCC has a long and successful track record of bolt-on acquisitions which have strengthened our market positions and generated attractive returns on capital invested.

The Group continued to either maintain or increase market shares in the primary markets within which it operates. This was achieved through good organic growth, contributions from acquisitions in the current year and the successful integration of acquisitions completed in prior years.

Continuously benchmarking and improving the efficiency of our operating model in each of our businesses.

DCC strives to be the most efficient business in each of the sectors in which it operates. We continuously benchmark our businesses against those specific KPIs which we judge are important indicators in our drive for superior returns on capital in the short, medium and longer term.

During the year the Group successfully completed the integration of acquisitions made in prior years, the most significant of which were the integration of the former Total and BP LPG businesses in DCC Energy and Kent Pharma in DCC Healthcare.

Following the rebranding of all the businesses under the ‘Exertis’ brand, DCC Technology is planning to further integrate its operations and service offering including an upgrade of its logistics and IT infrastructure.

The Group successfully implemented a number of cost efficiency initiatives during the year including DCC Energy’s logistics efficiency programme.


Carefully extending our geographic footprint, thereby providing new horizons for growth.

In the year ended 31 March 2014, 76% of DCC’s operating profits were derived from the UK, 13% from Continental Europe and the rest of the world and 11% from Ireland. In recent years we have been expanding certain of the Group’s businesses into Continental European markets which we believe will provide good opportunity for future growth. We will look to further extend our business in these markets and to enter new geographic markets in the coming years.

Following a record year of acquisition expenditure in FY13, the current year saw more modest expenditure. DCC Energy completed its first significant investment into the transport fuels market in Europe through the acquisition of Qstar, the fifth largest petrol retailer in Sweden. DCC Energy also completed the acquisition of Bronberger & Kessler, a leading oil distribution business based in southern Germany.

Despite the lower levels of expenditure in the current year, the Group remains disciplined in its approach to acquisition spend and the development strategy remains unchanged.


Maintaining financial strength through a disciplined approach to balance sheet management.

In pursuing our strategic objective, we will only do so in the context of maintaining relatively low levels of financial risk in the Group. We believe that this not only provides the greatest likelihood of generating value for shareholders in the long term but also leaves the Group best placed to react quickly to commercial opportunities as they arise.

The Group’s financial position remains very strong, well funded and highly liquid. The Group ended the current year with a strengthened net debt:EBITDA ratio of 0.3 times (2013: 0.7 times).

In March 2014 the Group arranged committed US Private Placement market funding of $750m with an average maturity of 10 years. This committed funding, together with available cash resources and committed bank term facilities, ensures that the Group retains significant financial capacity to support future growth.


Attracting and empowering entrepreneurial leadership teams, capable of delivering outstanding performance, through the deployment of a devolved management structure.

DCC strives to attract, motivate and empower entrepreneurial leadership teams across the Group. Given the diverse market sectors which we operate in, we believe that providing appropriate short and long term incentives to these leaders, based on the performance of the businesses which they manage, is the best way to drive returns for shareholders. Very often post-acquisition, we retain entrepreneurial managers who have sold their businesses to DCC and through our devolved management structure we ensure they are empowered to continue to develop those businesses.


Some of the key acquisitions completed during the year saw the Group retain and incentivise key management teams who are capable of contributing to the further success of the Group.

In addition, the Group continues to invest in its talent programme and processes which will be important to support the continued development and retention of high performing employees at Group, divisional and subsidiary levels.