DCC PLC · LSE:DCC
DCC — Investor Presentation (August 2011)
32 slides from DCC's investor presentation, August 2011
Slide 1: Introductory Presentation
DCC Introductory Presentation
Slide 2: Agenda
Agenda Overview A History of Performance The Business Q&A 2
Slide 3: DCC
DCC DCC is a sales, marketing, distribution and business support services Group, operating across five divisions • DCC Energy • DCC SerCom (IT & entertainment products) • DCC Healthcare • DCC Environmental • DCC Food & Beverage Operating Profit Split By Geography – YE 31 Mar 2011 13% UK 15% ROI 72%
Slide 4: DCC - History
DCC - History 1976 - 90 Founded by Jim Flavin as a venture and development capital company, with clear focus on return on capital employed and operating profit. Generated a compound annual return on investment of 23% over this period. 1990 - 94 Transition to diversified group focused on 5 sectors –
Slide 5: DCC – Divisions
DCC – Divisions Y/E 31 March 2011 Sales, marketing & distribution Business support services % of (87% of profits) (13% of profits) profits DCC Energy • Oil • LPG 60% • Fuel cards DCC SerCom SerCom Distribution SerCom Solutions • IT & entertainment products to: • Outsourced procurement and 20% • Reta
Slide 6: Strategy
Strategy To grow a sustainable, diversified business through: • Focus on businesses with established or potential to establish leadership positions; • Organic growth and acquisitions to strengthen market positions and geographic footprint; • Continued deployment of a devolved management structure; •
Slide 7: A History of Performance
A History of Performance DCC
Slide 8: Year ended March 2011 – Highlights of the year
Year ended 31 March 2011 – Highlights of the year Change on prior year € Reported Const Currency† Revenue 8,680.6m +29.1% +25.4% Operating profit* 229.6m +19.1% +15.5% Profit before net exceptional items, 214.8m +18.0% +14.3% amortisation of intangibles and tax Adjusted EPS* 203.15 cent +14.1% +10.5
Slide 9: Operating Profit and ROCE - history since flotation
Operating Profit and ROCE - history since flotation Op Profit €m ROCE % 250.0 60.0% Operating profit* 229.6 €’m 17 year CAGR 50.0% 200.0 192.8 14.7% 180.4 10 year CAGR 167.2 10.7% 40.0% 150.0 5 year CAGR 140.1 13.7% 121.0 30.0% 109.3 101.6 97.2 100.0 91.1 83.3 20.0% 67.0 53.5 41.5 50.0 29.7 10.0% 22
Slide 10: EPS growth - history since flotation
EPS growth - history since flotation Cent per share Adjusted EPS* (cent) 203.2 17 year CAGR 13.2% 178.0 10 year CAGR 169.1 165.1 9.5% 5 year CAGR 143.5 10.4% 124.0 115.1 106.0 101.5 94.9 82.2 65.3 55.4 44.4 37.5 31.9 24.8 28.4 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 Years ended 31 Marc
Slide 11: Dividend growth - history since flotation
Dividend growth - history since flotation Cent per share Dividend (cent) 74.2 17 year CAGR 15.6% 67.4 10 year CAGR 62.3 13.4% 56.7 5 year CAGR 11.6% 49.3 42.9 37.3 32.4 28.2 24.5 21.1 17.6 14.7 12.2 7.8 8.8 10.2 6.4 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 Years ended 31 March 11
Slide 12: Cash Flow FY 2000 – FY 2011
Cash Flow FY 2000 – FY 2011 12 Year € m CAGR Operating profit 1,567 12.9% • Free cash flow (before interest and tax) of Increase in working capital (31) €1.4bn Depreciation 421 • Revenue increased from €0.8 billion to Other (31) €8.7 billion. CAGR of 22.1% Operating cash flow 1,926 12.8% Capex (490)
Slide 13: Acquisitions
Acquisitions Cash spent on acquisitions By Division 200 177 Food & 180 Beverage, €53m, 6% Environmental, 160 €76m, 8% 140 134 Healthcare, 120 105 €114m, 12% 102 €‘m 100 88 81 78 80 Energy, €538m, 56% 59 60 55 38 Sercom, 40 €176m, 18% 26 20 14 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Slide 14: The Business
The Business DCC
Slide 15: DCC Energy
DCC Energy Marketing and selling oil and liquefied petroleum gas (LPG) • Leading oil and LPG distribution business in Britain and Ireland and developing oil business in continental Europe • Oil for transport, heating and industrial / 2011 agricultural processes Revenue €6,129.8m • LPG for heating, c
Slide 16: DCC Energy
DCC Energy Oil – Britain & Ireland LPG - Britain & Ireland • No. 1 Britain • No. 2 Britain 14% share 20% share 460,000 customers 125,000 customers 161 facilities 45 facilities c. 4.4 Bn. Lts. • No. 5 Ireland • No. 2 Ireland c. 9% share 37% share 80,000 customers 18,000 customers 23 facilities 5 faci
Slide 17: DCC Energy – Volume splits
DCC Energy – Volume splits Agricultural Fuel Oil 4% Other 3% Other 1% 5% Petrol 6% Retail 11% Propane 7% Diesel 37% Industrial 12% Commercial 55% Kerosene 18% Domestic 14% Gas Oil 27% Customer Split Product Split 17
Slide 18: DCC Energy - Sales Volumes & Operating Profit
DCC Energy - Sales Volumes & Operating Profit year ended 31 March Litres (billions) Operating Profit (€m) 8 137.3 140 7 113.1 7.1 120 6 100.7 6.2 100 5 74.3 5.3 80 4 59.5 4.3 54.8 60 50.7 3 45.2 3.2 41.2 2.9 32.8 2.5 40 2 2.0 2.1 1.7 20 1 0 0 02 03 04 05 06 07 08 09 10 11 Volume - 10 Year CAGR 17.6%
Slide 19: Strategy
Strategy • Drive organic profit growth through leveraging the scale of the business – Prioritise growth in the transport fuels segment • Retail petrol stations (supply) • Marine • Aviation – Expand sales of differentiated products e.g. fuel economy diesel, premium heating oil – Cross sell “add-on” p
Slide 20: DCC SerCom
DCC SerCom SerCom Distribution Marketing and selling IT and entertainment products to: • the Retail market - No 1 specialist distributor of consumer IT and entertainment products in Britain, Ireland and France to retailers, e-tailers and catalogue retailers • the Reseller market - Leading distributo
Slide 21: Structure of European IT Distribution
Structure of European IT Distribution Western European IT Market - €300bn IT Distribution - €65bn Indirect Tier 1: VARs Sales Tier 2 : Distribution IT Vendors Systems integrators VAR / ISV Corporate reseller Direct Sales Dealers Internet / mail order Source IDC & management estimates Retail 21
Slide 22: SerCom Distribution Full end to end service model
SerCom Distribution SUPPLIERS PRODUCTS SERCOM CUSTOMERS END-USERS Home entertainment, Etail, retail, RETAIL (41%) CONSUMERS peripherals, catalogue accessories, CE Desktop and VAR, Reseller, Vendors consumer IT RESELLER (39%) SME / SOHO Dealer products Datacentre ENTERPRISE VARs, LARs, Sis BUSINESS p
Slide 23: DCC SerCom
DCC SerCom Sector/Category Significant brands Retail Business Microsoft, Symantec, McAfee, Entertainment Microsoft (incl. Xbox), Nintendo, Take Two, THQ, Electronic Arts, Eidos, Vivendi, Universal, Ubisoft Consumer electronics & Logitech, Creative Labs, Seagate, Linx, TomTom, peripherals Phili
Slide 24: Strategy
Strategy • Retail: – Build the leading specialist retail distribution business in Western Europe • Vendor portfolio expansion • Service expansion • Establish the business as the obvious partner for a new vendor to access European retail – Acquisition and organic expansion to Germany, Benelux and Nor
Slide 25: DCC Healthcare
DCC Healthcare Broadly based service provider to international brand owners in the medical, pharmaceutical and health & beauty sectors and healthcare providers Areas of activity 2011 Hospital Supplies & Services - Provision of sales, marketing, distribution Revenue €311.1m* and other services in Ire
Slide 26: DCC Healthcare
DCC Healthcare Medical Pharma Health & Beauty Solutions Services • Sales, marketing & distribution • Registration and regulatory services • Product development and formulation services • Product licensing, QA/QC, PV • Regulatory and technical services • Single use medical devices and • Sales, market
Slide 27: DCC Healthcare - Strategy
DCC Healthcare - Strategy Organic Acquisitions Hospital Supplies • Medical • Medical • Expansion of product portfolio and service • Bolt on in Ireland & specialist & Services offerings distributors/related service providers in Britain • Pharma • Pharma • Expansion of product portfolio and service •
Slide 28: DCC Environmental
DCC Environmental Waste management and recycling services to the industrial, commercial, construction and public sectors in Britain and Ireland • Britain William Tracey, Scotland’s leading recycling and waste management business – materials recycling, hazardous waste treatment, landfill and renewabl
Slide 29: DCC Environmental
DCC Environmental Activities Non hazardous – Britain - Waste collection - Segregation - Recycling of aggregates, timber, plasterboard, glass, plastic, paper, metals - Composting of biodegradable waste - Disposal - Generation of electricity from landfill gas Hazardous – Britain and Ireland - Waste co
Slide 30: DCC Food & Beverage
DCC Food & Beverage Marketing and selling own and 3rd party brands to retail and foodservice sectors in Ireland and UK • Segment focus: health, indulgence, frozen/chilled logistics • Strong market positions in Ireland: 2011 No.1 in ambient healthy foods and in freshly ground coffee in retail and N
Slide 31: DCC Food & Beverage
DCC Food & Beverage Product Selected Customer Market Categories Brands Segments Positions Healthfoods Kelkin*, Alpro, BioFreeze, Dorset Grocery, No 1 in ambient healthy (foods, bevs & Cereals, Filippo Berio, Hipp, Lanes, Pharmacy foods in ROI VMS) Olbas, Ortis, Vitabiotics. Indulgence Wine Foods – R
Slide 32: Shareholder base
Shareholder base March 2011 Institutions Lending / Market Makers UK 32.6% 6.7% Management 2.9% North America 29.6% UK 32.6% Cont Europe + Asia 8.0% Retail 10.9% 70.2% Irish 9.3% 79.5% Irish 9.3% Retail 10.9% Management 2.9% Lending/Market makers 6.7% Cont. Europe / Asia 100.0% 8.0% Nth America 29.6%