DCC Faces Profit Dip, Reaffirms Optimistic Full-Year Outlook

DCC (LON: DCC) released interim results for the six months ended September 30, 2025, revealing a 5.4% decline in adjusted operating profit from continuing operations.

Despite the profit decrease, the company reiterated its full-year guidance, anticipating good operating profit growth.

Revenue for the period decreased by 7.1% to £7.38 billion. The drop was attributed to lower revenue in DCC Energy, stemming from reduced commodity prices and decreased volumes.

Adjusted earnings per share from continuing operations also declined by 4.2% to 120.8 pence.

Despite the headwinds, DCC increased its interim dividend by 5.0% to 69.50 pence per share, signaling confidence in its prospects for the remainder of the fiscal year. This marks the a further consecutive year of dividend growth for the company, averaging a compound annual growth rate of 12.9%.

The company has been actively reshaping its portfolio, completing the sales of DCC Healthcare and DCC Technology's Info Tech business. DCC returned £100 million to shareholders and intends to launch a £600 million tender offer shortly, expected to be completed in December 2025.

The company is streamlining operations to focus on DCC Energy. “It has been a period of significant strategic progress,” commented Donal Murphy, Chief Executive.

“We completed the sale of our Healthcare business, the sale of our Info Tech business, and our £100 million share buyback programme. We expanded our liquid gas activities in Europe, a priority for growth where we have a good pipeline of further development opportunities. We continue to expect good profit growth for the full year in line with market expectations, demonstrating our resilient business model. We are excited about our growth opportunities as a simpler, stronger DCC Energy. We're on track to deliver our 2030 ambition.”

Driver Breakdown:

• Strategic Realignment: Sales of Healthcare and Info Tech businesses simplify operations.
• Mobility Growth: Organic growth in Mobility partially offset lower profits in Energy Products.
• European Expansion: Approximately £50 million committed to liquid gas acquisitions in Europe.

While adjusted operating profit declined by 5.4%, trading improved in the second quarter, leading to modest operating profit growth in that quarter. This suggests a potential turnaround in performance as the year progresses. Organic growth in Mobility and Energy Services also provided some offset to lower profits in Energy Products.

Net debt (excluding lease creditors) decreased significantly to £522.3 million, compared to £1,092.1 million in the prior year, benefiting from the cash proceeds received from the sale of DCC Healthcare. This improved financial position provides DCC with increased flexibility for future acquisitions and investments.

The company recorded a net exceptional charge after tax of £267.2 million, primarily related to DCC Technology's Info Tech business in the UK and Ireland. This charge reflects an impairment loss expected from the disposal of the business.