DCC says operating profit ‘strongly ahead’ in third quarter

Sales, marketing and support services group DCC said operating profit for the third quarter was "strongly ahead" of the previous year despite the ongoing pandemic.

The group also said it expected results for the full year to beat market expectations, as the final three months of 2020 showed strong organic operating profit growth. Acquisitions also yielded some benefit for the group.

Its DCC LPG business and DCC Retail & Oil both delivered good operating profit growth, with lower volume demand attributed to the restrictions imposed to deal with the Covid-19 pandemic.

DCC LPG said cylinder and domestic demand remained robust, and the business also benefited from the acquisitions of NES Group in the US and Budget Energy in Ireland.

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DCC Retail & Oil, meanwhile, saw benefits from good procurement and cost control, as well as growth in non-fuel income, lubricants and roadside services.

Business-to-business sectors such as pro AV remained challenging for DCC Technology in the quarter, but the company benefited from the shift to working from home, with consumer and audio products also showing strong demand across Britain and Ireland.

International operations also benefited from the lockdown, through etail and non-traditional retail channels .

Nutritional products

Operating profit was well ahead of the prior year in DCC Healthcare, with DCC Health & Beauty Solutions continuing to see very strong demand for nutritional products across its markets.

DCC said it continued to expect good growth for the financial year ending March 31st, 2021, ahead of market expectations, assuming weather conditions remained normal in the final quarter. This was despite the uncertain outlook for all economies thanks to the increasing restrictions being imposed to control the spread of Covid-19.

The group has committed £230 million to new acquisitions across Europe and North America in the current financial year, with acquisitions including United Propane Gas and a bolt-on acquisition in Colorado for £106 million, the purchase of Campus Oil Ireland, and DCC Technology's acquisition of North American pro AV distributor JB&A.

DCC is set to announce its full-year results on May 18th.