DCC operating profits up, to raise dividend

A strong first-half performance from DCC’s energy division contributed to a 17 per cent rise in group operating profit to €60.6 million and led to company to increase its dividend.

In a statement this morning DCC said its dividend would rise by 10 per cent to 22.6 cent and this will be paid on December 5th. DCC shares opened over 4 per cent higher on the Dublin market at €13. Pre-tax profits for the period were €47.3 million, up from €40.8 million over the same period the previous year.

It said operating conditions were "increasingly challenging" and said the unpredictable economic environment was impacting on the business.

Despite this, the group is forecasting a 10 per cent earnings growth for the year on a constant currency basis.

DCC said it has ambitions to expand its business and would look at acquisitions and organic growth and its strong balance sheet and favourable liquidity position meant it was well placed to take advantage of opportunities.

DCC Energy reported a 56.5 per cent rise in operating profit to €22.8 million, boosted by synergies from recent acquisitions and cold weather in April.

Higher interest rates resulted in net finance costs rising to €10.2 million compared with €7.4 million over the same period in 2007.

DCC reported a €1.2 million net exceptional profit after exception charges following the sale of a small associate company for €5 million.

A strategy review to “maximise shareholder value on a consistent basis over the longer term” is ongoing and the company expects to complete it by the end of the financial year.