Business support services company DCC has today raised its dividend after reporting annual profit ahead of market expectations.
This was thanks to robust growth in its healthcare and technology businesses during the pandemic.
It said that all of its divisions recorded operating profit growth in the 12 months to the end of March despite the "challenging" trading environment.
DCC sells technology brands such as Samsung and Apple and counts Amazon as its largest customer in its technology division.
The company, which sells LPG, operates service stations and electric vehicle (EV) fast-charging networks, and distributes medical and electronic products, said adjusted operating profit rose 7.3% to £530.2m the year ended March 31.
But revenues for the year fell by 9.1% to £13.412 billion from £14.755 billion.
Over the past year, DCC has expanded its EV fast-charging infrastructure by 50%, at a time when the availability of EV charging networks poses a major challenge for car owners looking to switch over from petrol or diesel cars.
The company said a proposed 12.6% increase in the final dividend will see the total dividend for the year increase by 10% - DCC's 27th consecutive year of dividend growth.
During the year DCC committed about £375m to acquisitions, including further bolt-on acquisitions announced today of £55m.
It said that each of its division was acquisitive during the year, including the "significant expansion" of DCC LPG's business in the US with the acquisition of UPG and the initial entry by DCC Healthcare into the German and Swiss primary care markets through the acquisition of Wörner.
Donal Murphy, DCC's chief executive, said the company continued its excellent track record of growth and development, despite the unprecedented challenges during the year.
"A strong trading performance, excellent cash generation, very strong returns on capital employed and continued development activity are hallmarks of DCC's resilient business model," Mr Murphy said.
"We remain active from a development perspective and are ambitious to build DCC into a global leader in our chosen sectors. We continue to have the platforms, opportunities and capability to do so," the CEO said.
"The group is well placed to navigate the ongoing uncertainty, build on our momentum and continue DCC's growth and development into the future," he added.
DCC also today announced the appointment of Mark Breuer as Chairman Designate and will succeed John Moloney in July at the company's AGM.
John Moloney has been chairman of DCC since September 2014 and a non-executive Director since February 2009.
Mark Breuer joined the board of DCC in November 2018 and is an experienced business leader and corporate financier, with over 30 years experience in investment banking, most recently in JP Morgan.
Breaking down its divisions, DCC said its LPG unit performed "resiliently" during the year, despite the difficult conditions within the commercial and industrial sectors resulting from the Covid-19 pandemic.
It said that despite trading behind the previous year for the first half of the financial year, DCC LPG recovered well and delivered modest operating profit growth for the full year, benefiting from acquisitions in the US market and the gradual easing of Covid-19 restrictions.
Operating profit increased by 1.3% to £231.3m, while volumes increased by 3.8% driven by acquisition activity in the US and Ireland.
DCC Retail & Oil delivered good growth in operating profit and further improved its very strong return on capital employed, despite the disruption experienced across all economies during the year.
The company said that operating profit at the division rose to £144.8m, an increase of 3.3% - almost all of the growth was organic.
It sold 10.2 billion litres of product, a decline of 12.3% on the previous year, but after having been significantly adversely impacted in the first quarter by the Covid-19 restrictions,
commercial and transport volumes improved steadily thereafter.
DCC noted that the business experienced good demand in the domestic and agricultural sectors, particularly in Britain, Denmark, Austria and Ireland.
Meanwhile, DCC Healthcare delivered another strong performance, generating excellent operating profit growth of 45.9% on a continuing basis, more than half of which was organic.
DCC Health & Beauty Solutions generated very strong organic growth in nutritional products and also benefited from acquisitions in the US. DCC Vital also generated good growth, benefiting from its rapid response to changes in the product and service needs of the healthcare systems in Ireland and the UK.
DCC Technology also delivered very strong operating profit growth of 11%. It said that although the Covid-19 pandemic created significant uncertainty across both retail and B2B markets, DCC Technology responded well to this uncertainty and benefited from the breadth of its customer base and product and service offering.
Looking ahead, DCC said that although the uncertainty created by the Covid-19 pandemic continues, it expects that the year ending March 2022 will be another year of profit growth and development for it.
Shares in the company were lower in London trade today.
