REG - DCC PLC - Results for the year ended 31 March 2015 <Origin Href="QuoteRef">DCC.L</Origin> - Part 2
15/07/2015 18:14
- Part 2: For the preceding part double click ID:nRSS5716Na
driven by integration synergies, margin improvement, good cost control
and also benefitted from a full year contribution from UPL, acquired in January 2014. The business is leveraging its
increased market presence in the beauty area and its enhanced capability in the manufacturing of creams and liquids. The
Swedish tablet manufacturing operations have now been fully integrated into the larger tablet manufacturing facility in
Britain with sales and regulatory personnel retained in Sweden to focus on business development in the Nordic region. DCC
Health & Beauty Solutions seeks to focus its resources on developing and manufacturing more complex, higher added value
products on behalf of its customers. The business made good progress in this regard during the year which enabled it to
improve its sales mix, particularly in nutritional soft gel capsules, and achieve higher margins.
DCC Healthcare remains well placed to continue the strong record of growth and development across its business.
DCC Environmental
2015 2014 % change
Revenue £143.6m £130.6m +9.9%
Operating profit £13.3m £11.7m +13.2%
Operating margin 9.3% 9.0%
Return on capital employed 9.7% 8.6%
DCC Environmental recorded a strong result, with operating profit increasing by 13.2% and an improvement in its return on
capital employed.
Despite the impact in the year of sustained weakness in commodity prices, the British business performed strongly. Volumes
grew by 18% primarily as a result of increased economic activity, particularly in the industrial and construction sectors,
and good new business development initiatives. Underlying margins also improved aided by an increase in the proportion of
waste diverted from landfill, the most expensive and least environmentally sustainable disposal outlet.
Operating profit also increased in Ireland. The business successfully expanded its range of services, particularly to the
waste water treatment sector. In addition, the business benefitted from good cost management and its continuing focus on
operational efficiency.
Annual Report and Annual General Meeting
DCC's 2015 Annual Report will be published in June 2015. The Company's Annual General Meeting will be held at 11.00 am on
Friday 17 July 2015 in The InterContinental Hotel, Simmonscourt Road, Ballsbridge, Dublin 4, Ireland.
Forward-looking statements
This announcement contains some forward-looking statements that represent DCC's expectations for its business, based on
current expectations about future events, which by their nature involve risk and uncertainty. DCC believes that its
expectations and assumptions with respect to these forward-looking statements are reasonable, however because they involve
risk and uncertainty as to future circumstances, which are in many cases beyond DCC's control, actual results or
performance may differ materially from those expressed in or implied by such forward-looking statements.
Presentation of results and dial-in facility
There will be a presentation of these results to analysts and investors/fund managers in London at 8.45 am today. The
slides for this presentation can be downloaded from DCC's website, www.dcc.ie.
A dial-in facility will be available for this meeting:
Ireland: +353 (0) 1 486 0914
UK / International: +44 (0) 20 3427 1903
Passcode: 7191600
This announcement and further information on DCC is available at www.dcc.ie
Group Income Statement
for the year ended 31 March 2015
2015 Restated 2014
Pre exceptionals Exceptionals(note 8) Total Pre exceptionals Exceptionals(note 8) Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Continuing operations
Revenue 7 10,606,080 - 10,606,080 11,044,763 - 11,044,763
Cost of sales (9,781,910) - (9,781,910) (10,283,389) - (10,283,389)
Gross profit 824,170 - 824,170 761,374 - 761,374
Administration expenses (262,923) - (262,923) (246,515) - (246,515)
Selling and distribution expenses (350,978) - (350,978) (330,582) - (330,582)
Other operating income 19,657 3,798 23,455 19,253 30,491 49,744
Other operating expenses (8,210) (23,602) (31,812) (2,833) (39,053) (41,886)
Operating profit before amortisation of intangible assets 221,716 (19,804) 201,912 200,697 (8,562) 192,135
Amortisation of intangible assets (24,057) - (24,057) (19,656) - (19,656)
Operating profit 7 197,659 (19,804) 177,855 181,041 (8,562) 172,479
Finance costs (60,216) (2,191) (62,407) (50,540) (2,128) (52,668)
Finance income 31,288 - 31,288 29,409 - 29,409
Equity accounted investments' profit after tax 402 - 402 520 - 520
Profit before tax from continuing operations 169,133 (21,995) 147,138 160,430 (10,690) 149,740
Profit for the financial year from discontinued operations 6 5,088 11,079 16,167 6,006 (4,721) 1,285
Profit before tax 174,221 (10,916) 163,305 166,436 (15,411) 151,025
Income tax expense (18,881) - (18,881) (21,827) (5,255) (27,082)
Profit after tax for the financial year 1 155,340 (10,916) 144,424 144,609 (20,666) 123,943
Profit attributable to:
Owners of the Parent 144,427 121,234
Non-controlling interests (3) 2,709
144,424 123,943
Profit after tax for the financial year comprises:
Profit after tax from continuing operations 128,661 123,369
Profit after tax from discontinued operations 15,763 574
144,424 123,943
Earnings per ordinary share
Basic - continuing operations 9 153.20p 144.02p
Basic - discontinued operations 9 18.77p 0.68p
Basic 9 171.97p 144.70p
Diluted - continuing operations 9 152.10p 143.22p
Diluted - discontinued operations 9 18.63p 0.68p
Diluted 9 170.73p 143.90p
Group Statement of Comprehensive Income
for the year ended 31 March 2015
2015 2014
£'000 £'000
Group profit for the financial year 144,424 123,943
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Currency translation:
- arising in the year (15,007) (7,575)
- recycled to the Income Statement on disposal (2,721) 324
Movements relating to cash flow hedges (6,942) (3,455)
Movement in deferred tax liability on cash flow hedges 324 288
(24,346) (10,418)
Items that will not be reclassified to profit or loss
Group defined benefit pension obligations:
- remeasurements (19,302) (835)
- movement in deferred tax asset 2,187 152
(17,115) (683)
Other comprehensive income for the financial year, net of tax (41,461) (11,101)
Total comprehensive income for the financial year 102,963 112,842
Attributable to:
Owners of the Parent 103,555 110,189
Non-controlling interests (592) 2,653
102,963 112,842
Attributable to:
Continuing operations 103,378 114,479
Discontinued operations (415) (1,637)
102,963 112,842
Group Balance Sheet
as at 31 March 2015
Restated
2015 2014
Note £'000 £'000
ASSETS
Non-current assets
Property, plant and equipment 464,689 464,864
Intangible assets 759,179 742,516
Equity accounted investments 4,963 6,124
Deferred income tax assets 9,380 11,251
Derivative financial instruments 233,150 56,240
1,471,361 1,280,995
Current assets
Inventories 320,655 501,408
Trade and other receivables 847,274 957,821
Derivative financial instruments 5,395 1,221
Cash and cash equivalents 1,260,942 962,139
2,434,266 2,422,589
Assets classified as held for sale 12,196 -
2,446,462 2,422,589
Total assets 3,917,823 3,703,584
EQUITY
Capital and reserves attributable to owners of the Parent
Share capital 14,688 14,688
Share premium 83,032 83,032
Share based payment reserve 11 12,756 10,630
Cash flow hedge reserve 11 (10,462) (3,844)
Foreign currency translation reserve 11 32,683 49,822
Other reserves 11 932 932
Retained earnings 849,119 786,158
Equity attributable to owners of the Parent 982,748 941,418
Non-controlling interests 4,245 4,837
Total equity 986,993 946,255
LIABILITIES
Non-current liabilities
Borrowings 1,314,386 725,831
Derivative financial instruments 92 45,636
Deferred income tax liabilities 30,533 27,518
Post employment benefit obligations 13 10,230 16,033
Provisions for liabilities and charges 29,016 24,157
Contingent acquisition consideration 40,149 36,949
Government grants 1,272 1,323
1,425,678 877,447
Current liabilities
Trade and other payables 1,312,136 1,489,054
Current income tax liabilities 16,095 32,244
Borrowings 149,472 316,726
Derivative financial instruments 7,902 18,699
Provisions for liabilities and charges 8,096 6,785
Contingent acquisition consideration 3,235 16,374
1,496,936 1,879,882
Liabilities associated with assets classified as held for sale 8,216 -
1,505,152 1,879,882
Total liabilities 2,930,830 2,757,329
Total equity and liabilities 3,917,823 3,703,584
Net cash/(debt) included above (including cash attributable to assets held for sale) 12 29,987 (87,292)
Group Statement of Changes in Equity
For the year ended 31 March 2015 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 1 April 2014 14,688 83,032 786,158 57,540 941,418 4,837 946,255
Profit for the financial year - - 144,427 - 144,427 (3) 144,424
Currency translation:
- arising in the year - - - (14,418) (14,418) (589) (15,007)
- recycled to the Income Statement on disposal - - - (2,721) (2,721) - (2,721)
Group defined benefit pension obligations:
- remeasurements - - (19,302) - (19,302) - (19,302)
- movement in deferred tax asset - - 2,187 - 2,187 - 2,187
Movements relating to cash flow hedges - - - (6,942) (6,942) - (6,942)
Movement in deferred tax liability on cash flow hedges - - - 324 324 - 324
Total comprehensive income - - 127,312 (23,757) 103,555 (592) 102,963
Re-issue of treasury shares - - 1,699 - 1,699 - 1,699
Share based payment - - - 2,126 2,126 - 2,126
Dividends - - (66,050) - (66,050) - (66,050)
At 31 March 2015 14,688 83,032 849,119 35,909 982,748 4,245 986,993
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 1 April 2013 14,688 83,032 725,514 66,717 889,951 2,391 892,342
Profit for the financial year - - 121,234 - 121,234 2,709 123,943
Currency translation:
- arising in the year - - - (7,519) (7,519) (56) (7,575)
- recycled to the Income Statement on disposal - - - 324 324 - 324
Group defined benefit pension obligations:
- remeasurements - - (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 31 March 2014 14,688 83,032 786,158 57,540 941,418 4,837 946,255
Group Cash Flow Statement
for the year ended 31 March 2015
Restated
2015 2014
Note £'000 £'000
Cash flows from operating activities
Profit for the financial year 144,424 123,943
Add back non-operating expenses
- tax 18,881 27,082
- share of equity accounted investments' profit (489) (997)
- net operating exceptionals 8,725 13,283
- net finance costs 31,313 23,539
Operating profit before exceptionals 202,854 186,850
Share-based payments expense 2,126 1,185
Depreciation 59,710 55,402
Amortisation of intangible assets 25,345 20,416
Profit on disposal of property, plant and equipment (3,256) (1,783)
Amortisation of government grants (358) (383)
Other (primarily pension payments) (11,159) (1,779)
Decrease in working capital 102,556 86,955
Cash generated from operations before exceptionals 377,818 346,863
Exceptionals (16,454) (21,097)
Cash generated from operations 361,364 325,766
Interest paid (59,678) (50,011)
Income tax paid (32,361) (33,033)
Net cash flows from operating activities 269,325 242,722
Investing activities
Inflows:
Proceeds from disposal of property, plant and equipment 16,054 8,579
Government grants received 52 100
Dividends received from equity accounted investments 828 633
Disposal of subsidiaries and equity accounted investments 6 55,090 11,073
Interest received 31,222 30,210
103,246 50,595
Outflows:
Purchase of property, plant and equipment (79,401) (78,557)
Acquisition of subsidiaries 14 (107,223) (39,876)
Contingent acquisition consideration paid (16,326) (10,196)
(202,950) (128,629)
Net cash flows from investing activities (99,704) (78,034)
Financing activities
Inflows:
Re-issue of treasury shares 1,699 1,981
Increase in interest-bearing loans and borrowings 448,989 342,950
Net cash inflow on derivative financial instruments - 4,554
Increase in finance lease liabilities - 324
450,688 349,809
Outflows:
Repayment of interest-bearing loans and borrowings (169,631) (60,364)
Repayment of finance lease liabilities (486) (499)
Net cash outflow on derivative financial instruments (9,832) -
Dividends paid to owners of the Parent 10 (66,050) (61,888)
Dividends paid to non-controlling interests - (207)
(245,999) (122,958)
Net cash flows from financing activities 204,689 226,851
Change in cash and cash equivalents 374,310 391,539
Translation adjustment (58,206) (8,355)
Cash and cash equivalents at beginning of year 813,561 430,377
Cash and cash equivalents at end of year 1,129,665 813,561
Cash and cash equivalents consists of:
Cash and short term bank deposits 1,260,942 962,139
Overdrafts (133,629) (148,578)
Cash and short term deposits attributable to assets held for sale 2,352 -
1,129,665 813,561
Notes to the Financial Statements
for the year ended 31 March 2015
1. Basis of Preparation
The financial information, from the Group Income Statement to note 18, contained in this preliminary results statement has
been derived from the Group financial statements for the year ended 31 March 2015 and is presented in sterling, rounded to
the nearest thousand. The financial information does not include all the information and disclosures required in the
annual financial statements. The Annual Report will be distributed to shareholders and made available on the Company's
website www.dcc.ie. It will also be filed with the Companies Registration Office. The auditors have reported on the
financial statements for the year ended 31 March 2015 and their report was unqualified. The financial information for the
year ended 31 March 2014 represents an abbreviated, restated version of the Group's statutory financial statements on which
an unqualified audit report was issued and which have been filed with the Companies Registration Office.
The financial information presented in this report has been prepared in accordance with the Listing Rules of the Financial
Services Authority and the accounting policies that the Group has adopted for 2015 which are consistent with those applied
in the prior year except as otherwise set out below.
2. Accounting Policies
The Group has adopted the following standards, interpretations and amendments to existing standards during the financial
year:
· IFRS 10 Consolidated Financial Statements. This standard replaces all of the guidance on control and consolidation
in IAS 27 and SIC 12. IFRS 10 changes the definition of control so that the same criteria are applied to all entities to
determine control. The core principle that a consolidated entity presents a parent and its subsidiaries as if they are a
single entity remains unchanged, as do the mechanics of consolidation. IAS 27 is renamed 'Separate Financial Statements'
and is now a standard dealing solely with separate financial statements. This standard and the amendment to IAS 27 did not
have a significant impact on the Group's financial statements;
· 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 3. 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;
· IFRS 12 Disclosure of Interests in Other Entities. This standard sets out the required disclosures for entities
reporting under IFRS 10 and IFRS 11. IFRS 12 requires entities to disclose information about the nature, risks and
financial effects associated with the entity's interests in subsidiaries, associates, joint arrangements and unconsolidated
structured entities. This standard did not have a significant impact on the Group's financial statements; and
· Amendment to IAS 32 Financial Instruments: Presentation. This amendment clarifies that the right of set-off within
financial assets and financial liabilities must not be contingent on a future event. It must also be legally enforceable
for all counterparties in the normal course of business, as well as in the event of default, insolvency or bankruptcy. This
amendment did not have a significant impact on the Group's financial statements.
There are a number of other amendments to existing standards which became effective for the Group during the financial year
but did not result in material changes to the Group's consolidated financial statements.
3. 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
Year ended 31 March 2014
Analysed as:
Change in Restated Restated
As Accounting Discontinued Continuing
Reported Policy Restated Operations Operations
£'000 £'000 £'000 £'000 £'000
Revenue 11,231,666 (20,834) 11,210,832 166,069 11,044,763
Operating profit before exceptional items and amortisation of intangible assets 208,403 (1,137) 207,266 6,569 200,697
Net operating exceptional items (13,283) - (13,283) (4,721) (8,562)
Amortisation of intangible assets (20,416) - (20,416) (760) (19,656)
Operating profit 174,704 (1,137) 173,567 1,088 172,479
Finance costs (net) (23,539) - (23,539) (280) (23,259)
Share of equity accounted investments 33 964 997 477 520
Profit before tax 151,198 (173) 151,025 1,285 149,740
Income tax expense (27,255) 173 (27,082) (711) (26,371)
Profit after tax for the financial year 123,943 - 123,943 574 123,369
Earnings per ordinary share
Basic 144.70p - 144.70p 0.68p 144.02p
Diluted 143.90p - 143.90p 0.68p 143.22p
Adjusted earnings per ordinary share
Basic 191.20p - 191.20p 7.11p 184.09p
Diluted 190.14p - 190.14p 7.08p 183.06p
Impact on Group Balance Sheet
As at 31 March 2014
Change in
As accounting
reported policy Restated
£'000 £'000 £'000
ASSETS
Non-current assets excluding equity accounted investments 1,280,990 (6,119) 1,274,871
Equity accounted investments 824 5,300 6,124
Current assets 2,425,785 (3,196) 2,422,589
Total assets 3,707,599 (4,015) 3,703,584
EQUITY
Total equity 946,255 - 946,255
LIABILITIES
Non-current liabilities 877,455 (8) 877,447
Current liabilities 1,883,889 (4,007) 1,879,882
Total liabilities 2,761,344 (4,015) 2,757,329
Total equity and liabilities 3,707,599 (4,015) 3,703,584
Net debt included above (86,287) (1,005) (87,292)
Impact on Group Cash Flow Statement
Year ended 31 March 2014
Change in
As accounting
reported policy Restated
£'000 £'000 £'000
Net cash flows from operating activities 244,363 (1,641) 242,722
Net cash flows from investing activities (79,346) 1,312 (78,034)
Net cash flows from financing activities 226,851 - 226,851
Change in cash and cash equivalents 391,868 (329) 391,539
Translation adjustment (8,376) 21 (8,355)
Opening cash and cash equivalents 431,074 (697) 430,377
Closing cash and cash equivalents 814,566 (1,005) 813,561
4. Statutory Accounts
The financial information included in this report does not constitute full statutory financial statements but has been
derived from the Group financial statements for the year ended 31 March 2015 which were approved by the Board of Directors
on 18 May 2015.
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
2015 2014 2015 2014
Stg£1= Stg£1= Stg£1= Stg£1=
Euro 1.2674 1.1847 1.3749 1.2074
Danish Krone 9.4577 8.8386 10.2705 9.0146
Swedish Krona 11.6866 10.3362 12.7734 10.8045
Norwegian Krone 10.7266 9.5103 11.9669 9.9674
6. Net Result from Discontinued Operations and Assets Classified as Held for Sale
Net Result from Discontinued Operations
As announced on 23 February 2015 the Group completed the disposal of the Roberts Roberts (including Findlater Wine &
Spirits) and Kelkin businesses. In addition, the Group disposed of the trade and assets of Allied Foods as announced on 4
November 2014 and the disposal of Bottle Green Limited was completed on 28 April 2015. These businesses represented the
Group's Food & Beverage division.
The following table summarises the consideration received, the profit on disposal of discontinued operations and the net
cash flow arising on the disposal of these businesses:
£'000
Net consideration:
Proceeds received 55,090
Costs of disposal (4,326)
Total net consideration 50,764
Assets and liabilities disposed of:
Non-current assets 35,597
Current assets 37,631
Non-current liabilities (9,138)
Current liabilities (19,569)
Net identifiable assets and liabilities disposed of 44,521
Recycling of foreign exchange gain previously recognised in foreign currency translation reserve (2,721)
Non-cash impairment loss arising on assets held for sale 750
42,550
Profit on disposal of discontinued operations after tax 8,214
Net cash flow from disposal of discontinued operations:
Total proceeds received 55,176
Cash and cash equivalents disposed of (86)
Net cash inflow from disposal of discontinued operations 55,090
Disposal costs paid (2,431)
52,659
The conditions for the businesses disposed of during the year (Robert Roberts, Kelkin and the trade and assets of Allied
Foods) and after year end (Bottle Green Limited) to be classified as discontinued operations were fulfilled in the second
half of the current financial year and, consequently, the results of these businesses which represented the Group's Food &
Beverage division are presented separately as discontinued operations in the Group Income Statement and Group Cash Flow
Statement.
The following table details the results of discontinued operations included in the Group Income Statement:
2015 2014
£'000 £'000
Revenue 143,360 166,069
Cost of sales (111,314) (128,849)
Gross profit 32,046 37,220
Expenses (25,563) (30,651)
Operating profit before amortisation of intangible assets and exceptional items 6,483 6,569
Amortisation of intangible assets (1,288) (760)
Operating profit 5,195 5,809
Net finance costs (194)
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