DCC reports operating profit growth as it focuses on energy

(Sharecast News) - DCC reported a 4.9% rise in total adjusted operating profit to £703.6m on a constant currency basis for the year to 31 March on Tuesday, driven by 8.5% growth in its energy division. The FTSE 100 group announced plans to return £800m to shareholders following the agreed sale of DCC Healthcare for £1.05bn, starting with a £100m share buyback programme.

Free cash flow stood at £588.8m with a conversion rate of 84%, while adjusted earnings per share rose 5.2% on a constant currency basis to 470.2p.

The annual dividend was raised by 5% to 206.4p, marking the company's 31st consecutive year of dividend growth.

DCC said it was simplifying its structure to focus on energy, having exited lower-returning operations in Hong Kong and Macau and made targeted acquisitions in Europe aligned with its cleaner energy strategy.

It said it expected good profit growth in the year ahead from continuing operations, supported by further strategic and development progress.

"We are pleased to report that we delivered another year of good growth, while making strategic progress to simplify the group to focus on our opportunity in energy," said chief executive officer Donal Murphy.

"Our sale of DCC Healthcare enables a material return of capital to shareholders.

"We will focus our efforts on energy, our largest and highest-returning business; we are energised about the future."

Reporting by Josh White for Sharecast.com.