REG - DCC PLC - Interim Report <Origin Href="QuoteRef">DCC.L</Origin> - Part 2
04/11/2014 08:06
- Part 2: For the preceding part double click ID:nRSD0473Wa
Non-current assets
Property, plant and equipment 483,919 439,368 464,864
Intangible assets 784,608 754,217 742,516
Equity accounted investments 5,305 6,294 6,124
Deferred income tax assets 10,431 9,376 11,251
Derivative financial instruments 95,709 73,548 56,240
1,379,972 1,282,803 1,280,995
Current assets
Inventories 399,395 474,477 501,408
Trade and other receivables 938,228 1,033,283 957,821
Derivative financial instruments 5,747 8,846 1,221
Cash and cash equivalents 1,075,909 875,152 962,139
2,419,279 2,391,758 2,422,589
Assets classified as held for sale 16 57,624 - -
2,476,903 2,391,758 2,422,589
Total assets 3,856,875 3,674,561 3,703,584
EQUITY
Capital and reserves attributable to owners of the Parent
Share capital 14,688 14,688 14,688
Share premium 83,032 83,032 83,032
Share based payment reserve 11 11,649 10,116 10,630
Cash flow hedge reserve 11 (7,828) (3,245) (3,844)
Foreign currency translation reserve 11 42,216 53,016 49,822
Other reserves 11 932 932 932
Retained earnings 776,509 720,347 786,158
921,198 878,886 941,418
Non-controlling interests 4,525 2,414 4,837
Total equity 925,723 881,300 946,255
LIABILITIES
Non-current liabilities
Borrowings 1,209,269 796,322 725,831
Derivative financial instruments 16,177 41,236 45,636
Deferred income tax liabilities 26,892 30,136 27,518
Retirement benefit obligations 13 15,053 18,067 16,033
Provisions for liabilities and charges 36,213 17,859 24,157
Deferred and contingent acquisition consideration 40,285 51,149 36,949
Government grants 1,461 1,394 1,323
1,345,350 956,163 877,447
Current liabilities
Trade and other payables 1,287,277 1,456,506 1,489,054
Current income tax liabilities 25,057 23,566 32,244
Borrowings 218,222 321,193 316,726
Derivative financial instruments 7,992 14,918 18,699
Provisions for liabilities and charges 5,335 4,330 6,785
Deferred and contingent acquisition consideration 10,389 16,585 16,374
1,554,272 1,837,098 1,879,882
Liabilities associated with assets classified as held for sale 16 31,530 - -
1,585,802 1,837,098 1,879,882
Total liabilities 2,931,152 2,793,261 2,757,329
Total equity and liabilities 3,856,875 3,674,561 3,703,584
Net debt included above (including cash attributable to assets held for sale) 12 (272,828) (216,123) (87,292)
Group Statement of Changes in Equity
For the six months ended 30 September 2014 Attributable to owners of the Parent
Other Non-
Share Share Retained reserves controlling Total
capital premium earnings (note 11) Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At beginning of period 14,688 83,032 786,158 57,540 941,418 4,837 946,255
Profit for the period - - 42,310 - 42,310 (15) 42,295
Currency translation - - - (7,606) (7,606) (297) (7,903)
Group defined benefit pension obligations:
- actuarial loss - - (12,129) - (12,129) - (12,129)
- movement in deferred tax asset - - 1,443 - 1,443 - 1,443
Movements relating to cash flow hedges - - - (4,004) (4,004) - (4,004)
Movement in deferred tax liability on cash flow hedges - - - 20 20 - 20
Total comprehensive income - - 31,624 (11,590) 20,034 (312) 19,722
Re-issue of treasury shares - - 1,717 - 1,717 - 1,717
Share based payment - - - 1,019 ,019 - 1,019
Dividends - - (42,990) - (42,990) - (42,990)
At end of period 14,688 83,032 776,509 46,969 921,198 4,525 925,723
For the six months ended 30 September 2013 Attributable to owners of the Parent
Other Non-
Share Share Retained reserves controlling Total
capital premium earnings (note 11) Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At beginning of period 14,688 83,032 725,514 66,717 889,951 2,391 892,342
Profit for the period - - 35,019 - 35,019 250 35,269
Currency translation - - - (4,001) (4,001) (18) (4,019)
Group defined benefit pension obligations:
- actuarial loss - - (1,309) - (1,309) - (1,309)
- movement in deferred tax asset - - 164 - 164 - 164
Movements relating to cash flow hedges - - - (2,766) (2,766) - (2,766)
Movement in deferred tax liability on cash flow hedges - - - 198 198 - 198
Total comprehensive income - - 33,874 (6,569) 27,305 232 27,537
Re-issue of treasury shares - - 1,179 - 1,179 - 1,179
Share based payment - - - 671 671 - 671
Dividends - - (40,220) - (40,220) (209) (40,429)
At end of period 14,688 83,032 720,347 60,819 878,886 2,414 881,300
For the year ended 31 March 2014 Attributable to owners of the Parent
Other Non-
Share Share Retained reserves controlling Total
capital premium earnings (note 11) Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At beginning of period 14,688 83,032 725,514 66,717 889,951 2,391 892,342
Profit for the period - - 121,234 - 121,234 2,709 123,943
Currency translation:
- arising in the period - - - (7,519) (7,519) (56) (7,575)
- recycled to the Income Statement on disposal of subsidiary - - - 324 324 - 324
Group defined benefit pension obligations:
- actuarial loss - - (835) - (835) - (835)
- movement in deferred tax asset - - 152 - 152 - 152
Movements relating to cash flow hedges - - - (3,455) (3,455) - (3,455)
Movement in deferred tax liability on cash flow hedges - - - 288 288 - 288
Total comprehensive income - - 120,551 (10,362) 110,189 2,653 112,842
Re-issue of treasury shares - - 1,981 - 1,981 - 1,981
Share based payment - - 1,185 1,185 - 1,185
Dividends - - (61,888) - (61,888) (207) (62,095)
At end of period 14,688 83,032 786,158 57,540 941,418 4,837 946,255
Group Cash Flow Statement
Restated Restated
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2014 2013 2014
£'000 £'000 £'000
Cash flows from operating activities
Profit for the period 42,295 35,269 123,943
Add back non-operating expenses
- tax 5,173 7,211 27,082
- share of equity accounted investments (401) (481) (997)
- net operating exceptionals 252 1,566 13,283
- net finance costs 12,915 15,242 23,539
Group operating profit before exceptionals 60,234 58,807 186,850
Share-based payment 1,019 671 1,185
Depreciation 30,222 30,097 55,402
Amortisation of intangible assets 13,009 10,038 20,416
Profit on disposal of property, plant and equipment (643) (432) (1,783)
Amortisation of government grants (179) (194) (383)
Other (3,342) (782) (1,779)
(Increase)/decrease in working capital (82,462) 11,871 86,955
Cash generated from operations before exceptionals 17,858 110,076 346,863
Exceptionals (3,631) (12,625) (21,097)
Cash generated from operations 14,227 97,451 325,766
Interest paid (27,513) (24,828) (50,011)
Income tax paid (13,066) (16,197) (33,033)
Net cash flows from operating activities (26,352) 56,426 242,722
Investing activities
Inflows
Proceeds from disposal of property, plant and equipment 3,249 1,174 8,579
Government grants received 52 - 100
Dividends received from equity accounted investments 647 - 633
Disposal of subsidiaries - - 11,073
Interest received 14,383 16,462 30,210
18,331 17,636 50,595
Outflows
Purchase of property, plant and equipment (39,588) (34,374) (78,557)
Acquisition of subsidiaries (97,260) (15,720) (39,876)
Deferred and contingent acquisition consideration paid (8,215) (7,046) (10,196)
(145,063) (57,140) (128,629)
Net cash flows from investing activities (126,732) (39,504) (78,034)
Financing activities
Inflows
Re-issue of treasury shares 1,717 1,179 1,981
Increase in interest-bearing loans and borrowings 448,989 341,705 342,950
Net cash inflow on derivative financial instruments - - 4,554
Increase in finance lease liabilities - - 324
450,706 342,884 349,809
Outflows
Repayment of interest-bearing loans and borrowings (124,305) - (60,364)
Net cash outflow on derivative financial instruments (13,869) - -
Repayment of finance lease liabilities (551) (823) (499)
Dividends paid to owners of the Parent (42,990) (40,220) (61,888)
Dividends paid to non-controlling interests - (209) (207)
(181,715) (41,252) (122,958)
Net cash flows from financing activities 268,991 301,632 226,851
Change in cash and cash equivalents 115,907 318,554 391,539
Translation adjustment (26,222) (4,135) (8,355)
Cash and cash equivalents at beginning of period 813,561 430,377 430,377
Cash and cash equivalents at end of period 903,246 744,796 813,561
Cash and cash equivalents consists of:
Cash and short term bank deposits 1,075,909 875,152 962,139
Overdrafts (174,130) (130,356) (148,578)
Cash and short term deposits attributable to assets held for sale 1,467 - -
903,246 744,796 813,561
Notes to the Group Condensed Interim Financial Statements
for the six months ended 30 September 2014
1. Basis of Preparation
The Group Condensed Interim Financial Statements which should be read in conjunction with the annual financial statements
for the year ended 31 March 2014 have been prepared in accordance with the Transparency (Directive 2004/109/EC) Regulations
2007, the related Transparency rules of the Irish Financial Services Regulatory Authority and in accordance with
International Accounting Standard 34, Interim Financial Reporting (IAS 34) as adopted by the EU.
The preparation of the interim financial statements requires management to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of certain assets, liabilities, revenues and expenses together with
disclosure of contingent assets and liabilities. Estimates and underlying assumptions are reviewed on an ongoing basis.
These condensed interim financial statements for the six months ended 30 September 2014 and the comparative figures for the
six months ended 30 September 2013 are unaudited and have not been reviewed by the Auditors. The summary financial
statements for the year ended 31 March 2014 represent a restated (as detailed below), abbreviated version of the Group's
full accounts for that year, on which the Auditors issued an unqualified audit report and which have been filed with the
Registrar of Companies.
2. Accounting Policies
The accounting policies and methods of computation adopted in the preparation of the Group Condensed Interim Financial
Statements are consistent with those applied in the Annual Report for the financial year ended 31 March 2014 and are
described in those financial statements on pages 128 to 139.
The following standard was mandatory for the first time for the financial year beginning 1 April 2014:
· IFRS 11 Joint Arrangements. Under IAS 31 Interests in Joint Ventures, the Group's net interests in its joint
arrangements were classified as joint ventures and the Group's share of assets, liabilities, revenue, income and expense
were proportionately consolidated. IFRS 11 makes equity accounting mandatory for participants in joint ventures. The
change to equity accounting had no impact on the Group's profit after tax but impacted each line item in the Consolidated
Income Statement. Similarly, the Consolidated Balance Sheet was impacted on a line by line basis but net assets remained
unchanged.
As required by IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, the nature and effect of changes
arising as a result of the adoption of IFRS 11 on the Consolidated Income Statement, Consolidated Statement of Cash Flows
and Consolidated Balance Sheet are disclosed in note 4. Under the transitional provisions of IFRS 11 the Group is not
required to disclose the impact that the adoption of IFRS 11 has had on the current period.
There are a number of other amendments to existing standards that were effective for the Group for the first time from 1
April 2014. None of these had a material impact on the Group.
3. Going Concern
The Directors have a reasonable expectation that the Group and Company have adequate resources to continue in operational
existence for the foreseeable future, a period of not less than twelve months from the date of this report. For this
reason, the Directors continue to adopt the going concern basis in preparing the condensed interim financial statements.
4. Adoption of New Accounting Standards
As noted under Accounting Policies above, the Group adopted IFRS 11 Joint Arrangements on 1 April 2014. As required by IAS
8 Accounting Policies, Changes in Accounting Estimates and Errors, the financial impact of the adoption of this standard is
outlined below.
Impact on Group Income Statement
6 months ended 30 Sept. 2013 Year ended 31 March 2014
As Change in As Change in
reported accounting Restated reported accounting Restated
Unaudited policy Unaudited Audited policy Unaudited
£'000 £'000 £'000 £'000 £'000 £'000
Revenue 5,419,907 (10,231) 5,409,676 11,231,666 (20,834) 11,210,832
Operating profit before exceptional items and amortisation of intangible assets 69,355 (510) 68,845 208,403 (1,137) 207,266
Net operating exceptionals (1,566) - (1,566) (13,283) - (13,283)
Amortisation of intangible assets (10,038) - (10,038) (20,416) - (20,416)
Operating profit 57,751 (510) 57,241 174,704 (1,137) 173,567
Finance costs (net) (15,242) - (15,242) (23,539) - (23,539)
Share of equity accounted investments 4 477 481 33 964 997
Profit before tax 42,513 (33) 42,480 151,198 (173) 151,025
Income tax expense (7,244) 33 (7,211) (27,255) 173 (27,082)
Profit after tax for the period 35,269 - 35,269 123,943 - 123,943
Earnings per ordinary share
Basic 41.82p - 41.82p 144.70p - 144.70p
Diluted 41.59p - 41.59p 143.90p - 143.90p
Adjusted earnings per ordinary share
Basic 58.34p - 58.34p 191.20p - 191.20p
Diluted 58.02p - 58.02p 190.14p - 190.14p
Impact on Group Balance Sheet
As at 30 Sept. 2013 As at 31 March 2014
As Change in As Change in
reported accounting Restated reported accounting Restated
Unaudited policy Unaudited Audited policy Unaudited
£'000 £'000 £'000 £'000 £'000 £'000
ASSETS
Non-current assets 1,282,766 (6,257) 1,276,509 1,280,990 (6,119) 1,274,871
Equity accounted investments 802 5,492 6,294 824 5,300 6,124
Current assets 2,394,827 (3,069) 2,391,758 2,425,785 (3,196) 2,422,589
Total assets 3,678,395 (3,834) 3,674,561 3,707,599 (4,015) 3,703,584
EQUITY
Total equity 881,300 - 881,300 946,255 - 946,255
LIABILITIES
Non-current liabilities 956,171 (8) 956,163 877,455 (8) 877,447
Current liabilities 1,840,924 (3,826) 1,837,098 1,883,889 (4,007) 1,879,882
Total liabilities 2,797,095 (3,834) 2,793,261 2,761,344 (4,015) 2,757,329
Total equity and liabilities 3,678,395 (3,834) 3,674,561 3,707,599 (4,015) 3,703,584
Net debt included above (215,633) (490) (216,123) (86,287) (1,005) (87,292)
Impact on Group Cash Flow Statement
6 months ended 30 Sept. 2013 Year ended 31 March 2014
As Change in As Change in
reported accounting Restated reported accounting Restated
Unaudited policy Unaudited Audited policy Unaudited
£'000 £'000 £'000 £'000 £'000 £'000
Net cash flows from operating activities 56,622 (196) 56,426 244,363 (1,641) 242,722
Net cash flows from investing activities (39,904) 400 (39,504) (79,346) 1,312 (78,034)
Net cash flows from financing activities 301,632 - 301,632 226,851 - 226,851
Change in cash and cash equivalents 318,350 204 318,554 391,868 (329) 391,539
Translation adjustment (4,138) 3 (4,135) (8,376) 21 (8,355)
Opening cash and cash equivalents 431,074 (697) 430,377 431,074 (697) 430,377
Closing cash and cash equivalents 745,286 (490) 744,796 814,566 (1,005) 813,561
5. Reporting Currency
The Group's financial statements are prepared in sterling, denoted by the symbol £. The exchange rates used in translating
non-sterling Income Statement and Balance Sheet amounts into sterling were as follows:
Average rate Closing rate
6 months 6 months Year 6 months 6 months Year
ended Ended ended ended ended ended
30 Sept. 30 Sept. 31 March 30 Sept. 30 Sept. 31 March
2014 2013 2014 2014 2013 2014
Stg£1= Stg£1= Stg£1= Stg£1= Stg£1= Stg£1=
Euro 1.2361 1.1700 1.1847 1.2865 1.1960 1.2074
Danish Krone 9.2234 8.7251 8.8386 9.5756 8.9200 9.0146
Swedish Krona 11.2682 10.0853 10.3362 11.7670 10.3546 10.8045
Norwegian Krone 10.2270 9.0815 9.5103 10.4451 9.7046 9.9674
6. Segmental Reporting
DCC is an international sales, marketing, distribution and business support services group headquartered in Dublin,
Ireland. Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker has been identified as Mr. Tommy Breen, Chief Executive and
his executive management team. The Group is organised into five operating segments: DCC Energy, DCC Technology, DCC
Healthcare, DCC Environmental and DCC Food & Beverage.
DCC Energy markets and sells oil products and services for transport, commercial/industrial, marine, aviation and home
heating use in Britain, Ireland and Continental Europe. DCC Energy also owns, operates and supplies unmanned and manned
retail service stations in Britain, Ireland and Continental Europe. DCC Energy markets and sells liquefied petroleum gas
for similar uses in Britain, Ireland and Continental Europe.
DCC Technology sells, markets and distributes a broad range of consumer and SME focussed technology products in Europe.
DCC Healthcare sells, markets and distributes pharmaceutical and medical devices in British and Irish markets. DCC
Healthcare also provides outsourced product development, manufacturing, packaging and other services to health and beauty
brand owners in Europe.
DCC Environmental provides a broad range of waste management and recycling services to the industrial, commercial,
construction and public sectors in Britain and Ireland.
DCC Food & Beverage markets and sells food and beverages in Ireland and wine in Britain. DCC Food & Beverage is also a
provider of frozen food supply chain services in Ireland.
Net finance costs and income tax are managed on a centralised basis and therefore these items are not
allocated between operating segments for the purpose of presenting information to the chief operating
decision maker and accordingly are not included in the detailed segmental analysis below. The
consolidated total assets of the Group as at 30 September 2014 of £3.857 billion were not materially
different from the equivalent figure at 31 March 2014 and therefore the related segmental disclosure
note has been omitted in accordance with IAS 34 Interim Financial Reporting. Intersegment revenue is
not material and thus not subject to separate disclosure. An analysis of the Group's performance by
segment and geographic location is as follows:
(a) By operating segment
Unaudited six months ended 30 September 2014
DCC DCC DCC DCC DCC Food
Energy Technology Healthcare Environmental & Beverage Total
£'000 £'000 £'000 £'000 £'000 £'000
Segment revenue 4,076,971 1,037,877 236,922 73,562 89,024 5,514,356
Operating profit* 31,934 15,204 15,902 7,058 3,145 73,243
Amortisation of intangible assets (7,450) (1,402) (3,074) (394) (689) (13,009)
Net operating exceptionals (note 7) (1,788) (965) 308 (31) 2,224 (252)
Operating profit 22,696 12,837 13,136 6,633 4,680 59,982
Unaudited six months ended 30 September 2013 (restated)
DCC DCC DCC DCC DCC Food
Energy Technology Healthcare Environmental & Beverage Total
£'000 £'000 £'000 £'000 £'000 £'000
Segment revenue 4,093,358 959,257 195,088 64,908 97,065 5,409,676
Operating profit* 33,502 14,115 12,553 6,316 2,359 68,845
Amortisation of intangible assets (6,823) (990) (1,167) (673) (385) (10,038)
Net operating exceptionals (note 7) 455 (689) (1,332) - - (1,566)
Operating profit 27,134 12,436 10,054 5,643 1,974 57,241
Audited year ended 31 March 2014 (restated)
DCC DCC DCC DCC DCC Food
Energy Technology Healthcare Environmental & Beverage Total
£'000 £'000 £'000 £'000 £'000 £'000
Segment revenue 8,243,645 2,263,973 406,510 130,635 166,069 11,210,832
Operating profit* 110,467 48,092 30,392 11,746 6,569 207,266
Amortisation of intangible assets (13,686) (1,974) (2,711) (1,285) (760) (20,416)
Net operating exceptionals (note 7) (4,219) (11,371) 3,285 3,743 (4,721) (13,283)
Operating profit 92,562 34,747 30,966 14,204 1,088 173,567
* Operating profit before amortisation of intangible assets and net operating exceptionals
(b) By geography
Unaudited six months ended 30 September 2014
Republic of Rest of
UK Ireland the World Total
£'000 £'000 £'000 £'000
Segment revenue 4,108,866 394,232 1,011,258 5,514,356
Operating profit* 57,040 3,700 12,503 73,243
Amortisation of intangible assets (7,784) (1,279) (3,946) (13,009)
Net operating exceptionals (note 7) (1,487) 1,885 (650) (252)
Operating profit 47,769 4,306 7,907 59,982
Unaudited six months ended 30 September 2013 (restated)
Republic of Rest of
UK Ireland the World Total
£'000 £'000 £'000 £'000
Segment revenue 4,069,259 438,015 902,402 5,409,676
Operating profit* 56,243 4,122 8,480 68,845
Amortisation of intangible assets (5,674) (1,076) (3,288) (10,038)
Net operating exceptionals (note 7) (5,289) 556 3,167 (1,566)
Operating profit 45,280 3,602 8,359 57,241
Audited year ended 31 March 2014 (restated)
Republic of Rest of
UK Ireland the World Total
£'000 £'000 £'000 £'000
Segment revenue 8,386,565 889,804 1,934,463 11,210,832
Operating profit* 158,735 22,062 26,469 207,266
Amortisation of intangible assets (11,721) (2,075) (6,620) (20,416)
Net operating exceptionals (note 7) 2,812 (13,963) (2,132) (13,283)
Operating profit 149,826 6,024 17,717 173,567
* Operating profit before amortisation of intangible assets and net operating exceptionals
7. Exceptional Items
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2014 2013 2014
£'000 £'000 £'000
Restructuring costs (1,353) (4,514) (19,720)
Impairment of goodwill - - (13,923)
Acquisition and related costs (2,243) (2,182) (5,638)
Impairment of property, plant and equipment - - (550)
Adjustments to deferred and contingent acquisition consideration 202 4,274 16,165
Net profit on disposal of subsidiaries - - 5,294
Restructuring of Group defined benefit pension schemes 2,424 1,456 1,435
Litigation and other operating exceptional items 718 (600) 3,654
Operating exceptional items (252) (1,566) (13,283)
Mark to market gains (included in interest) 471 (4,336) (2,128)
Tax on Taiwanese legal claim - - (5,255)
Net exceptional items after taxation 219 (5,902) (20,666)
Non-controlling interest share of profit on disposal of subsidiary - - (2,055)
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