DCC indicates further acquisitions likely this year

INDUSTRIAL HOLDING company DCC is hoping make further acquisitions this year to follow two purchases made over the last three months.

The company spent €36 million in the first quarter of its financial year purchasing Pearts, a medium-sized oil distributor in the north of England and an oil storage operation in Inverness, Scotland.

Last month, its healthcare division sold its mobility and rehabilitation business for €30 million. The firm accounted for less than 1 per cent of the operating profits that DCC earned in its last financial year.

After the company’s annual general meeting in Dublin yesterday, chief executive Tommy Breen said the group was looking at further opportunities.

However, he stressed that any purchase would have to generate a return on capital greater than the cost of capital.

DCC has several divisions – healthcare, food and drink, energy, environmental services and the distribution of consumer electronics goods.

The company told shareholders that it expected operating profits in its current financial year, which ends on March 31st, 2011, to increase by 5 per cent over last year and for earnings per share to be “modestly ahead” of 2010.

“Although it is still early in the group’s financial year, it is encouraging that in the first quarter ended June 30th, 2010, the group traded ahead of the prior year and modestly ahead of expectations,” the company said.

DCC’s operations made a profit of €192.8 million in the 12 months ended March 31st last. Sales were €6.7 billion.