REG - DCC PLC - Results for the six months ended 30 September 2016 <Origin Href="QuoteRef">DCC.L</Origin> - Part 3
14/11/2016 07:07
- Part 3: For the preceding part double click ID:nRSN0347Pb
The consideration will
be paid entirely in cash and is structured as an initial payment at completion, followed by earn out payments over three
years based on Hammer's future trading results.
The acquisition, which is subject to competition clearance from the European Commission, is expected to complete by the end
of December 2016. As such, an initial assignment of fair values to identifiable net assets acquired has not yet been
performed.
Medium
In November 2016 DCC Technology acquired Medium (U.K.) Limited, a distributor of professional audio visual equipment to
resellers in the UK. The consideration for the acquisition was based on an enterprise valuation of £8.3 million and was
satisfied in cash at completion. An initial assignment of fair values to identifiable net assets acquired has not been
completed given the timing of the closure of the transaction.
Gaz Européen
DCC Energy has agreed to acquire Gaz Européen Holdings SAS ('Gaz Européen'), a natural gas retail and marketing business
which supplies business and public sector customers in France. DCC has agreed to acquire 97% of the share capital of Gaz
Européen on completion, based on an initial enterprise value of E110 million (£95.7 million). The remaining shares will be
acquired based on Gaz Européen's results for the three years ending 31 March 2021, 2022 and 2023. All of the consideration
will be satisfied in cash.
The acquisition is conditional, inter alia, on clearance from the French Competition Authority and is expected to complete
in the first calendar quarter of 2017. As such, an initial assignment of fair values to identifiable net assets acquired
has not yet been performed.
Medisource
In November 2016, DCC Healthcare agreed to acquire Medisource Ireland Limited, a specialist in the procurement and sale of
Exempt Medicinal Products, for an initial enterprise valuation of E31.5 million (£27.4 million). The acquisition, which is
subject to competition clearance, is expected to complete in the first calendar quarter of 2017. As such, an initial
assignment of fair values to identifiable net assets acquired has not yet been performed.
17. Board Approval
This report was approved by the Board of Directors of DCC plc on 11 November 2016.
18. Distribution of Interim Report
This report and further information on DCC is available at the Company's website www.dcc.ie. A printed copy is available
to the public at the Company's registered office at DCC House, Leopardstown Road, Foxrock, Dublin 18, Ireland.
Statement of Directors' Responsibilities
We confirm that to the best of our knowledge:
1. the condensed set of interim financial statements have been prepared in accordance with IAS 34 Interim Financial
Reporting as adopted by the EU;
2. the interim management report includes a fair review of the information required by:
Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that
have occurred during the first six months of the financial year and their impact on the condensed set of financial
statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have
taken place in the first six months of the current financial year and that have materially affected the financial position
or performance of the entity during that period; and any changes in the related party transactions described in the last
annual report that could do so.
On behalf of the Board
John Moloney Tommy Breen
Chairman Chief Executive
11 November 2016
Supplementary Financial Information
Alternative Performance Measures
The Group reports certain financial measures that are not required under International Financial Reporting Standards
('IFRS') which represent the accounting principles under which the Group reports. The Group believes that the presentation
of these non-IFRS measures provides useful supplemental information which, when viewed in conjunction with our IFRS
financial information, provides investors with a more meaningful understanding of the underlying financial and operating
performance of the Group and its divisions.
These non-IFRS financial measures are primarily used for the following purposes:
• to evaluate the historical and planned underlying results of our operations;
• to set director and management remuneration; and
• to discuss and explain the Group's performance with the investment analyst community.
None of the non-IFRS measures should be considered as an alternative to financial measures derived in accordance with IFRS.
The non-IFRS measures can have limitations as analytical tools and should not be considered in isolation or as a substitute
for an analysis of our results as reported under IFRS.
The principal non-IFRS measures used by the Group, together with reconciliations where the non-IFRS measures are not
readily identifiable from the financial statements, are as follows:
Operating profit before net exceptionals and amortisation of intangible assets ('EBITA')
Definition
This comprises operating profit as reported in the Group Income Statement before net operating exceptional items and
amortisation of intangible assets.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Operating profit 95,141 70,640 254,261
Net operating exceptional items 4,416 5,863 14,640
Amortisation of intangible assets 18,266 11,884 31,622
Operating profit before net exceptionals and amortisation of intangible assets ('EBITA') 117,823 88,387 300,523
Net interest
Definition
The Group defines net interest as the net total of finance costs and finance income before interest related exceptional
items as presented in the Group Income Statement.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Finance costs before exceptional items (35,751) (32,161) (64,970)
Finance income before exceptional items 19,165 17,532 35,981
Net interest (16,586) (14,629) (28,989)
Effective tax rate
Definition
The Group's effective tax rate expresses the income tax expense before exceptionals and deferred tax attaching to the
amortisation of intangible assets as a percentage of EBITA less net interest.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
EBITA 117,823 88,387 300,523
Net interest (16,586) (14,629) (28,989)
Earnings before taxation 101,237 73,758 271,534
Income tax expense 13,071 10,269 35,314
Income tax relating to exceptional items (386) (1,037) 710
Deferred tax attaching to amortisation of intangible assets 5,031 2,569 7,421
Income tax expense before exceptionals and deferred tax attaching to amortisation of intangible assets 17,716 11,801 43,445
Effective tax rate (%) 17.5% 16.0% 16.0%
Net capital expenditure
Definition
Net capital expenditure comprises purchases of property, plant and equipment, proceeds from the disposal of property, plant
and equipment and government grants received in relation to property, plant and equipment.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Purchase of property, plant and equipment 65,878 54,695 134,172
Proceeds from disposal of property, plant and equipment (6,076) (3,439) (13,523)
Net capital expenditure 59,802 51,256 120,649
Free cash flow
Definition
Free cash flow is defined by the Group as cash generated from operations before exceptional items as reported in the Group
Cash Flow Statement after interest paid, income tax paid, net capital expenditure, dividends received from equity accounted
investments and interest received.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Cash generated from operations before exceptionals 141,039 120,739 411,712
Interest paid (33,313) (31,348) (64,432)
Income tax paid (28,122) (15,927) (35,346)
Net capital expenditure (59,802) (51,256) (120,649)
Dividends received from equity accounted investments 121 - 365
Interest received 19,191 17,479 36,004
Free cash flow 39,114 39,687 227,654
Free cash flow (before interest and tax payments)
Definition
Free cash flow (before interest and tax payments) is defined by the Group as cash generated from operations before
exceptional items as reported in the Group Cash Flow Statement after net capital expenditure.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Cash generated from operations before exceptionals 141,039 120,739 411,712
Net capital expenditure (59,802) (51,256) (120,649)
Free cash flow (before interest and tax payments) 81,237 69,483 291,063
Committed acquisition expenditure
Definition
The Group defines committed acquisition expenditure as the total acquisition cost of subsidiaries as presented in the Group
Cash Flow Statement (excluding amounts related to acquisitions which were committed to in previous years) and future
acquisition related liabilities for acquisitions committed to during the year.
6 months ended 6 months ended Year ended
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Net cash outflow on acquisitions during the year 6,609 43,315 390,042
Acquisition related liabilities arising on acquisitions during the year 1,050 323,966 81,519
Net cash outflow on acquisitions committed to in the previous year (6,609) (24,425) (351,045)
Acquisition related liabilities committed to in the previous year (1,050) (322,866) (79,288)
Amounts committed in the current year 180,515 20,425 39,000
Committed acquisition expenditure 180,515 40,415 80,228
Net working capital
Definition
Net working capital represents the net total of inventories, trade and other receivables (excluding interest receivable),
and trade and other payables (excluding interest payable, amounts due in respect of property, plant and equipment and
current government grants).
As at As at As at
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Inventories 435,716 402,658 393,948
Trade and other receivables 997,017 898,780 916,069
Interest receivable included in trade and other receivables (151) (280) (230)
Trade and other payables (1,536,255) (1,383,587) (1,437,832)
Interest payable included in trade and other payables 5,342 5,252 3,967
Amounts due in respect of property, plant and equipment included in trade and other payables 228 752 2,967
Government grants included in trade and other payables 83 25 26
Net working capital (98,020) (76,400) (121,085)
Working capital (days)
Definition
Working capital days measures how long it takes in days for the Group to convert working capital into revenue.
As at As at As at
30 Sept. 30 Sept. 31 March
2016 2015 2016
£'000 £'000 £'000
Net working capital (98,020) (76,400) (121,085)
September/March revenue 1,014,498 988,134 967,014
Working capital (days) (2.9 days) (2.3 days) (3.9 days)
This information is provided by RNS
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