REG - DCC PLC - Results for the six months ended 30 September 2016 <Origin Href="QuoteRef">DCC.L</Origin> - Part 2
14/11/2016 07:07
- Part 2: For the preceding part double click ID:nRSN0347Pa
- remeasurements - - (8,014) - (8,014) - (8,014)
- movement in deferred tax asset - - 1,227 - 1,227 - 1,227
Movements relating to cash flow hedges - - - 9,409 9,409 - 9,409
Movement in deferred tax liability on cash flow hedges - - - (1,504) (1,504) - (1,504)
Total comprehensive income - - 58,801 43,877 102,678 4,460 107,138
Re-issue of treasury shares - - 2,065 - 2,065 - 2,065
Share based payment - - - 1,415 1,415 - 1,415
Dividends - - (55,720) - (55,720) (5,055) (60,775)
At 30 September 2016 15,455 277,211 953,462 123,953 1,370,081 30,238 1,400,319
For the six months ended 30 September 2015 Attributable to owners of the Parent
Other Non-
Share Share Retained reserves controlling Total
capital premium earnings (note 10) Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At 1 April 2015 14,688 83,032 849,119 35,909 982,748 4,245 986,993
Profit for the period - - 41,270 - 41,270 932 42,202
Currency translation - - - 6,361 6,361 595 6,956
Group defined benefit pension obligations:
- remeasurements - - 8,041 - 8,041 - 8,041
- movement in deferred tax asset - - (1,132) - (1,132) - (1,132)
Movements relating to cash flow hedges - - - (3,881) (3,881) - (3,881)
Movement in deferred tax liability on cash flow hedges - - - 1,337 1,337 - 1,337
Total comprehensive income - - 48,179 3,817 51,996 1,527 53,523
Issue of share capital (net of expenses) 755 191,307 - - 192,062 - 192,062
Re-issue of treasury shares - - 1,922 - 1,922 - 1,922
Share based payment - - - 867 867 - 867
Dividends - - (49,897) - (49,897) - (49,897)
Non-controlling interests arising on acquisition - - - - - 18,542 18,542
At 30 September 2015 15,443 274,339 849,323 40,593 1,179,698 24,314 1,204,012
For the year ended 31 March 2016 Attributable to owners of the Parent
Other Non-
Share Share Retained reserves controlling Total
capital premium earnings (note 10) Total interests equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At 1 April 2015 14,688 83,032 849,119 35,909 982,748 4,245 986,993
Profit for the financial year - - 178,031 - 178,031 3,012 181,043
Currency translation - - - 35,706 35,706 2,265 37,971
Group defined benefit pension obligations:
- remeasurements - - 4,894 - 4,894 - 4,894
- movement in deferred tax asset - - (570) - (570) - (570)
Movements relating to cash flow hedges - - - 2,230 2,230 - 2,230
Movement in deferred tax liability on cash flow hedges - - - 120 120 - 120
Total comprehensive income - - 182,355 38,056 220,411 5,277 225,688
Issue of share capital (net of expenses) 767 194,179 - - 194,946 - 194,946
Re-issue of treasury shares - - 2,781 - 2,781 - 2,781
Share based payment - - - 2,198 2,198 - 2,198
Dividends - - (80,938) - (80,938) - (80,938)
Non-controlling interests arising on acquisition - - (5,001) 2,498 (2,503) 21,311 18,808
At 31 March 2016 15,455 277,211 948,316 78,661 1,319,643 30,833 1,350,476
Group Cash Flow Statement
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Cash flows from operating activities
Profit for the period 67,567 42,202 181,043
Add back non-operating expenses/(income)
- tax 13,071 10,269 35,314
- share of equity accounted investments' profit (182) (279) (504)
- net operating exceptionals 4,416 5,863 14,640
- net finance costs 14,685 18,448 38,408
Group operating profit before exceptionals 99,557 76,503 268,901
Share-based payments expense 1,415 867 2,198
Depreciation 42,913 32,534 74,822
Amortisation of intangible assets 18,266 11,884 31,622
Loss on disposal of property, plant and equipment 369 208 415
Amortisation of government grants (101) (176) (419)
Other (4,334) 3,346 (3,412)
(Increase)/decrease in working capital (17,046) (4,427) 37,585
Cash generated from operations before exceptionals 141,039 120,739 411,712
Exceptionals (8,752) (10,386) (19,567)
Cash generated from operations 132,287 110,353 392,145
Interest paid (33,313) (31,348) (64,432)
Income tax paid (28,122) (15,927) (35,346)
Net cash flows from operating activities 70,852 63,078 292,367
Investing activities
Inflows:
Proceeds from disposal of property, plant and equipment 6,076 3,439 13,523
Dividends received from equity accounted investments 121 - 365
Disposal of subsidiaries and equity accounted investments - 2,296 4,173
Interest received 19,191 17,479 36,004
25,388 23,214 54,065
Outflows:
Purchase of property, plant and equipment (65,878) (54,695) (134,172)
Acquisition of subsidiaries (6,609) (43,315) (390,042)
Payment of accrued acquisition related liabilities (26,200) (1,059) (3,913)
(98,687) (99,069) (528,127)
Net cash flows from investing activities (73,299) (75,855) (474,062)
Financing activities
Inflows:
Proceeds from issue of shares 2,065 193,984 197,727
Net cash inflow on derivative financial instruments 1,002 - 1,953
Increase in finance lease liabilities - 68 59
3,067 194,052 199,739
Outflows:
Repayment of interest-bearing loans and borrowings (29,895) - (14,832)
Repayment of finance lease liabilities (79) (83) (151)
Dividends paid to owners of the Parent (55,720) (49,897) (80,938)
Dividends paid to non-controlling interests (5,055) - -
(90,749) (49,980) (95,921)
Net cash flows from financing activities (87,682) 144,072 103,818
Change in cash and cash equivalents (90,129) 131,295 (77,877)
Translation adjustment 43,894 13,322 38,249
Cash and cash equivalents at beginning of period 1,090,037 1,129,665 1,129,665
Cash and cash equivalents at end of period 1,043,802 1,274,282 1,090,037
Cash and cash equivalents consists of:
Cash and short term bank deposits 1,138,953 1,458,748 1,182,034
Overdrafts (95,151) (184,466) (91,997)
1,043,802 1,274,282 1,090,037
Notes to the Condensed Financial Statements
for the six months ended 30 September 2016
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 2016 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 European Union.
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 2016 and the comparative figures for the
six months ended 30 September 2015 are unaudited and have not been reviewed by the Auditors. The summary financial
statements for the year ended 31 March 2016 represent an 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 2016 and are
described in those financial statements on pages 185 to 192.
The Group has adopted the following amendments to existing standards during the period which did not result in a material
change to the Group's consolidated financial statements:
· Annual Improvements 2012-2014 Cycle;
· Amendments to IAS 1 Disclosure Initiative;
· Amendments to IFRS 11 Accounting for Acquisitions of Interests in Joint Operations; and
· Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortisation.
There were a number of other amendments to existing standards which became effective for the Group for the first time from
1 April 2016. None of these had a material impact on the Group.
3. Going Concern
Having reassessed the principal risks facing the Group (as detailed on pages 15 to 17 of the Annual Report for the year
ended 31 March 2016), the Directors believe that the Group is well placed to manage these risks successfully.
The Directors have a reasonable expectation that DCC plc, and the Group as a whole, has 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 of accounting in preparing the condensed interim
financial statements.
4. Reporting Currency
The Group's financial statements are presented in sterling, denoted by the symbol '£'. Results and cash flows of operations
based in non-sterling countries have been translated into sterling at average rates for the period, and the related balance
sheets have been translated at the rates of exchange ruling at the balance sheet date. The principal exchange rates used
for translation of results and balance sheets 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
2016 2015 2016 2016 2015 2016
Stg£1= Stg£1= Stg£1= Stg£1= Stg£1= Stg£1=
Euro 1.2364 1.3902 1.3697 1.1614 1.3541 1.2633
Swedish Krona 11.5928 13.0057 12.7937 11.1742 12.7397 11.6547
Danish Krone 9.2173 10.3763 10.2297 8.6542 10.1013 9.4134
Norwegian Krone 11.5655 12.2304 12.4995 10.4373 12.8971 11.8938
5. Segmental Reporting
DCC is a 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 four operating segments: DCC Energy, DCC Healthcare, DCC Technology and DCC
Environmental.
DCC Energy markets and sells liquefied petroleum gas products and services for commercial/industrial, home heating,
cooking/leisure and transport use in Europe. DCC Energy markets and sells oil products and services for similar uses, in
addition to marine and aviation uses in Europe. DCC Energy also owns, operates and supplies unmanned and manned retail
service stations in Europe.
DCC Healthcare sells, markets and distributes own and third party pharmaceuticals and medical products to healthcare
providers across all sectors of the British and Irish healthcare markets. DCC Healthcare also provides outsourced product
development, manufacturing, packaging and other services to health and beauty brand owners in Europe.
DCC Technology sells, markets and distributes a broad range of consumer and business technology products and services 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.
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 2016 of £5.053 billion were not materially different from the
equivalent figure at 31 March 2016 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 2016
DCC DCC DCC DCC
Energy Healthcare Technology Environmental Total
£'000 £'000 £'000 £'000 £'000
Segment revenue 4,118,774 244,283 1,144,229 89,258 5,596,544
Operating profit* 76,033 19,760 11,302 10,728 117,823
Amortisation of intangible assets (13,390) (3,307) (1,481) (88) (18,266)
Net operating exceptionals (note 6) (1,819) (1,361) (1,236) - (4,416)
Operating profit 60,824 15,092 8,585 10,640 95,141
Unaudited six months ended 30 September 2015
DCC DCC DCC DCC
Energy Healthcare Technology Environmental Total
£'000 £'000 £'000 £'000 £'000
Segment revenue 3,659,729 239,120 1,089,055 78,336 5,066,240
Operating profit* 52,885 18,465 8,570 8,467 88,387
Amortisation of intangible assets (7,246) (3,307) (1,092) (239) (11,884)
Net operating exceptionals (note 6) (6,221) 3,586 (2,503) (725) (5,863)
Operating profit 39,418 18,744 4,975 7,503 70,640
Audited year ended 31 March 2016
DCC DCC DCC DCC
Energy Healthcare Technology Environmental Total
£'000 £'000 £'000 £'000 £'000
Segment revenue 7,515,308 490,617 2,441,705 153,455 10,601,085
Operating profit* 205,181 45,039 35,125 15,178 300,523
Amortisation of intangible assets (21,381) (7,138) (2,627) (476) (31,622)
Net operating exceptionals (note 6) (9,057) 5,859 (10,454) (988) (14,640)
Operating profit 174,743 43,760 22,044 13,714 254,261
* Operating profit before amortisation of intangible assets and net operating exceptionals
(b) By geography
The Group has a presence in 15 countries worldwide. The following represents a geographical analysis about the country of
domicile (Republic of Ireland) and countries with material revenue.
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Republic of Ireland 339,219 318,768 659,723
United Kingdom 3,421,914 3,537,671 6,985,521
France 1,038,271 485,229 1,487,875
Other 797,140 724,572 1,467,966
5,596,544 5,066,240 10,601,085
6. Exceptionals
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Restructuring costs (2,280) (6,458) (16,517)
Acquisition and related costs (1,374) (4,633) (7,478)
Impairment of property, plant and equipment (684) - (947)
Adjustments to contingent acquisition consideration 73 - 6,290
Gain arising from legal case settlements - 5,201 4,291
Legal and other operating exceptional items (151) 27 (279)
Net operating exceptional items (4,416) (5,863) (14,640)
Mark to market of swaps and related debt 1,901 (3,819) (9,419)
Net exceptional items before taxation (2,515) (9,682) (24,059)
Tax attributable to net exceptional items (386) (1,037) 710
Net exceptional items after taxation (2,901) (10,719) (23,349)
Non-controlling interest share of net exceptional items after taxation - - (323)
Net exceptional items (2,901) (10,719) (23,672)
The analysis of the net operating exceptional items is as follows:
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Exceptional operating income 408 5,291 13,829
Exceptional operating expense (4,824) (11,154) (28,469)
(4,416) (5,863) (14,640)
Acquisition related costs amounted to £1.374 million and restructuring costs amounted to £2.280 million. Acquisition costs
include the professional fees and tax costs (such as stamp duty) relating to the evaluation and completion of acquisition
opportunities.
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 interest rate 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 six
months ended 30 September 2016 this amounted to an exceptional gain of £1.901 million. The exceptional gains and losses on
the Group's private placement debt and related hedging instruments will net to zero on a cumulative basis over their
lives.
There was a net tax charge of £0.386 million in relation to the above net exceptional items.
7. Taxation
The taxation expense for the interim period is based on management's best estimate of the weighted average tax rate that is
expected to be applicable for the full year. The Group's effective tax rate for the period was 17.5% (six months ended 30
September 2015: 16.0% and year ended 31 March 2016: 16.0%).
8. Earnings per Ordinary Share
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Profit attributable to owners of the Parent 65,588 41,270 178,031
Amortisation of intangible assets after tax 13,235 9,315 24,201
Exceptionals after tax (note 6) 2,901 10,719 23,672
Adjusted profit after taxation and non-controlling interests 81,724 61,304 225,904
Basic earnings per ordinary share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Parent by the weighted average
number of ordinary shares in issue during the period, excluding ordinary shares purchased by the Company and held as
treasury shares.
The adjusted figures for basic earnings per ordinary share (a non-IFRS financial measure) are intended to demonstrate the
results of the Group after eliminating the impact of amortisation of intangible assets and net exceptionals.
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
pence pence pence
Basic earnings per ordinary share 73.95p 47.32p 202.64p
Amortisation of intangible assets after tax 14.92p 10.68p 27.55p
Exceptionals after tax (note 6) 3.27p 12.29p 26.95p
Adjusted basic earnings per ordinary share 92.14p 70.29p 257.14p
Weighted average number of ordinary shares in issue (thousands) 88,691 87,216 87,854
Diluted earnings per ordinary share
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares. Share options and awards are the Company's only category of dilutive
potential ordinary shares.
Employee share options and awards, which are performance-based, are treated as contingently issuable shares because their
issue is contingent upon satisfaction of specified performance conditions in addition to the passage of time. These
contingently issuable shares are excluded from the computation of diluted earnings per ordinary share where the conditions
governing exercisability would not have been satisfied as at the end of the reporting period if that were the end of the
vesting period.
The adjusted figures for diluted earnings per ordinary share are intended to demonstrate the results of the Group after
eliminating the impact of amortisation of intangible assets and net exceptionals.
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
pence pence pence
Diluted earnings per ordinary share 73.42p 46.91p 201.02p
Amortisation of intangible assets after tax 14.81p 10.59p 27.32p
Exceptionals after tax (note 6) 3.25p 12.19p 26.73p
Adjusted diluted earnings per ordinary share 91.48p 69.69p 255.07p
Weighted average number of ordinary shares in issue (thousands) 89,332 87,968 88,564
The weighted average number of ordinary shares used in calculating the diluted earnings per share for the six months ended
30 September 2016 was 89.332 million (six months ended 30 September 2015: 87.968 million). A reconciliation of the
weighted average number of ordinary shares used for the purposes of calculating the diluted earnings per share amounts is
as follows:
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
'000 '000 '000
Weighted average number of ordinary shares in issue 88,691 87,216 87,854
Dilutive effect of options and awards 641 752 710
Weighted average number of ordinary shares in issue (thousands) 89,332 87,968 88,564
9. Dividends
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Interim - paid 33.04 pence per share on 7 December 2015 - - 30,292
Final - paid 64.18 pence per share on 21 July 2016 (paid 55.81 pence per share on 23 July 2015) 55,720 49,897 50,646
55,720 49,897 80,938
On 11 November 2016, the Board approved an interim dividend of 37.17 pence per share (£32.995 million). These condensed
interim financial statements do not reflect this dividend payable.
10. Other Reserves
For the six months ended 30 September 2016
Foreign
Share based Cash flow currency
payment hedge translation Other
reserve reserve reserve reserves Total
£'000 £'000 £'000 £'000 £'000
At 1 April 2016 14,954 (8,112) 70,887 932 78,661
Currency translation - - 35,972 - 35,972
Movements relating to cash flow hedges - 9,409 - - 9,409
Movement in deferred tax liability on cash flow hedges - (1,504) - - (1,504)
Share based payment 1,415 - - - 1,415
At 30 September 2016 16,369 (207) 106,859 932 123,953
For the six months ended 30 September 2015
Foreign
Share based Cash flow currency
payment hedge translation Other
reserve reserve reserve reserves Total
£'000 £'000 £'000 £'000 £'000
At 1 April 2015 12,756 (10,462) 32,683 932 35,909
Currency translation - - 6,361 - 6,361
Movements relating to cash flow hedges - (3,881) - - (3,881)
Movement in deferred tax liability on cash flow hedges - 1,337 - - 1,337
Share based payment 867 - - - 867
At 30 September 2015 13,623 (13,006) 39,044 932 40,593
For the year ended 31 March 2016
Foreign
Share based Cash flow currency
payment hedge translation Other
reserve reserve reserve reserves Total
£'000 £'000 £'000 £'000 £'000
At 1 April 2015 12,756 (10,462) 32,683 932 35,909
Currency translation - - 35,706 - 35,706
Movements relating to cash flow hedges - 2,230 - - 2,230
Movement in deferred tax liability on cash flow hedges - 120 - - 120
Transfer to non-controlling interests arising on acquisition - - 2,498 - 2,498
Share based payment 2,198 - - - 2,198
At 31 March 2016 14,954 (8,112) 70,887 932 78,661
11. Analysis of Net (Debt)/Cash
Unaudited Unaudited Audited
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Non-current assets:
Derivative financial instruments 271,609 194,133 209,518
Current assets:
Derivative financial instruments 37,132 5,900 15,915
Cash and cash equivalents 1,138,953 1,458,748 1,182,034
1,176,085 1,464,648 1,197,949
Non-current liabilities:
Finance leases (131) (199) (127)
Derivative financial instruments - (1,083) (343)
Unsecured Notes (1,384,880) (1,285,522) (1,260,294)
(1,385,011) (1,286,804) (1,260,764)
Current liabilities:
Bank borrowings (95,151) (184,466) (91,997)
Finance leases (322) (358) (379)
Derivative financial instruments (2,574) (18,891) (8,401)
Unsecured Notes (76,801) (14,833) (100,428)
(174,848) (218,548) (201,205)
Net (debt)/cash (112,165) 153,429 (54,502)
12. Post Employment Benefit Obligations
The Group's defined benefit pension schemes' assets were measured at fair value at 30 September 2016. The defined benefit
pension schemes' liabilities at 30 September 2016 were updated to reflect material movements in underlying assumptions.
The net deficit on the Group's post employment benefit obligations increased from £0.347 million at 31 March 2016 to £7.045
million at 30 September 2016. The increase in the deficit was primarily driven by an actuarial loss on liabilities arising
from a reduction in the discount rate used to value these liabilities. This actuarial loss was somewhat offset by
contributions in excess of the current service cost.
The following actuarial assumptions have been made in determining the Group's retirement benefit obligation for the six
months ended 30 September 2016:
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
Discount rate
- Republic of Ireland 1.50% 2.50% 2.00%
- UK 2.45% 4.00% 3.60%
13. Business Combinations
A key strategy of the Group is to create and sustain market leadership positions through acquisitions in markets it
currently operates in, together with extending the Group's footprint into new geographic markets. In line with this
strategy, there were a number of relatively small acquisitions completed by the Group during the period.
The acquisition data presented below reflects the fair value of the identifiable net assets acquired (excluding net
cash/debt acquired) in respect of acquisitions completed during the six months ended 30 September 2016, together with
measurement period adjustments made to the provisional fair values in respect of the acquisition of Butagaz S.A.S.
('Butagaz') which was completed during the year ended 31 March 2016. These measurement period adjustments primarily
comprised reclassifications between categories of assets and liabilities.
Butagaz
measurement
period
Acquisitions adjustments Total Total
6 months 6 months 6 months 6 months
ended ended ended ended
30 Sept. 30 Sept. 30 Sept. 30 Sept.
2016 2016 2016 2015
£'000 £'000 £'000 £'000
Assets
Non-current assets
Property, plant and equipment 68 (2,168) (2,100) 235,743
Intangible assets - other intangible assets - - - 120,453
Equity accounted investments - 1,762 1,762 42
Total non-current assets 68 (406) (338) 356,238
Current assets
Inventories 1,324 - 1,324 44,420
Trade and other receivables 3,252 472 3,724 88,896
Total current assets 4,576 472 5,048 133,316
Liabilities
Non-current liabilities
Deferred income tax liabilities (13) - (13) (44,441)
Provisions for liabilities and charges - - - (189,639)
Total non-current liabilities (13) - (13) (234,080)
Current liabilities
Trade and other payables (2,517) 4,962 2,445 (75,365)
Provisions for liabilities and charges - (5,043) (5,043) (18,328)
Current income tax liability (193) 8,672 8,479 (13,332)
Acquisition related liabilities - (9,717) (9,717) -
Total current liabilities (2,710) (1,126) (3,836) (107,025)
Identifiable net assets acquired 1,921 (1,060) 861 148,449
Non-controlling interest arising on acquisition - - - (18,542)
Intangible assets - goodwill 5,738 1,060 6,798 237,374
Total consideration 7,659 - 7,659 367,281
Satisfied by:
Cash 8,813 - 8,813 134,744
Cash and cash equivalents acquired (2,204) - (2,204) (91,429)
Net cash outflow 6,609 - 6,609 43,315
Acquisition related liabilities 1,050 - 1,050 323,966
Total consideration 7,659 - 7,659 367,281
None of the business combinations completed during the period were considered sufficiently material to warrant separate
disclosure of the fair values attributable to those combinations.
There were no adjustments made to the carrying amounts of assets and liabilities acquired in arriving at their fair values.
The initial assignment of fair values to identifiable net assets acquired has been performed on a provisional basis in
respect of a number of the business combinations above given the timing of closure of these transactions. Any amendments
to these fair values within the twelve month timeframe from the date of acquisition will be disclosable in the Group's
condensed interim financial statements for the six months ending 30 September 2017 as stipulated by IFRS 3.
The principal factors contributing to the recognition of goodwill on business combinations entered into by the Group are
the expected profitability of the acquired business and the realisation of cost savings and synergies with existing Group
entities.
Acquisition related costs included in other operating expenses in the Group Income Statement amounted to £1.374 million
(six months ended 30 September 2015: £4.633 million).
No contingent liabilities were recognised on the acquisitions completed during the financial period or the prior financial
years.
The gross contractual value of trade and other receivables as at the respective dates of acquisition amounted to £3.318
million. The fair value of these receivables is £3.252 million (all of which is expected to be recoverable) and is
inclusive of an aggregate allowance for impairment of £0.066 million.
The fair value of contingent consideration recognised at the date of acquisition is calculated by discounting the expected
future payment to present value at the acquisition date. In general, for contingent consideration to become payable,
pre-defined profit thresholds must be exceeded. On an undiscounted basis, the future payments for which the Group may be
liable for acquisitions completed during the period range from nil to £4.7 million.
The acquisitions during the period contributed £8.3 million to revenues and £0.7 million to profit after tax. The revenue
and profit of the Group determined in accordance with IFRS for the period ended 30 September 2016 would not have been
materially different than reported in the Income Statement if the acquisition date for all business combinations completed
during the period had been as of the beginning of the period.
14. Seasonality of Operations
The Group's operations are significantly second-half weighted primarily due to a portion of the demand for DCC Energy's
products being weather dependent and seasonal buying patterns in DCC Technology.
15. Related Party Transactions
There have been no related party transactions or changes in the nature and scale of the related party transactions
described in the Annual Report in respect of the year ended 31 March 2016 that could have had a material impact on the
financial position or performance of the Group in the six months ended 30 September 2016.
16. Events after the Balance Sheet Date
Dansk Fuels
On 23 March 2016 DCC announced it had reached agreement to acquire Dansk Fuels, a commercial, aviation and retail fuels
business in Denmark, formerly owned by Shell. Following receipt of competition clearance from the European Commission the
acquisition was completed on 31 October 2016. The transaction requires a total investment by DCC of approximately DKK300
million (£35 million). An initial assignment of fair values to identifiable net assets acquired has not been completed
given the timing of the closure of the transaction.
Hammer
As announced on 14 October 2016, DCC Technology has agreed to acquire 100% of the issued share capital of Hammer
Consolidated Holdings Limited ('Hammer'), a specialist distributor of server and storage solutions to resellers in the UK
and Continental Europe. The acquisition is based on an initial enterprise value of £38.3 million.
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