DCC plans more acquisitions and expansion of British oil business

DCC plan to continue with acquisitions in the current financial year, and double its British oil distribution business over the next few years.

At the sales, marketing and business support services group’s annual general meeting in Dublin yesterday, chief executive Jim Flavin said he was satisfied with trading results in the first quarter, as well as the increasingly positive results of DCC SerCom.

“We expect to make further acquisitions within the current financial year, and are continually looking into various opportunities.

“We believe the acquisition of 50% of the William Tracey group of companies (Scotland’s leading recycling and waste management business) and the acquisition announced last Friday of Carlton Fuels — the fast growing north of England-based oil distribution business — will prove rewarding.

“We are now the largest supplier of oil for homes, industry and commerce in the UK, with a market share of 10%, and our ambition would be to get that up to 20% in the coming few years.”

He also highlighted room for expansion in the area of LPG (Liquid Petroleum Gas) and Flogas — where the company has a 21% share of the British market.

As much of DCC’s energy business is significantly second-weighted, only 30% of profits are recorded in the first half of the year.

While these were not released at yesterday’s AGM, the company believe they will reach market expectations this year, and are happy with the performance of the Limerick-based IT firm SerCom.

Last Friday the company announced the acquisition of Carlton Fuels for an initial cash consideration of £9.2 million (€13.3m), excluding net debt acquired.

Carlton sells approximately 500m litres of fuel per annum — principally diesel and gas oil — to a range of commercial, transport and local government customers.

Carlton is expected to report an adjusted operating profit of about £3.2m (€4.6m) on sales of approximately £280m (€404m).