MILD WINTER weather and high oil prices hit profits at industrial holding group DCC, whose heating oil supply business suffered as demand for its products fell during a key part of the year.
DCC’s revenues grew almost 25 per cent in the 12 months ended March 31st to €10.7 billion, up from €8.7 billion in its 2011 financial year, partly on the back of growth in its electrical goods distribution business.
However, operating profits fell 19 per cent to €185 million. Pre-tax profits were down 30 per cent at €133 million, from €190 million.
The fall in profits was largely down to the mild winter’s impact on its biggest business, DCC Energy, whose main focus is on distributing and selling home heating oil.
The energy division accounts for around three-quarters of DCC’s revenues. Figures for the 2012 financial year show that sales grew 27 per cent to €7.8 million.
This was partly due to an 11 per cent increase in the volume of products sold, which was in turn down to the fact that the group bought a number of smaller rivals during the year.
On a like-for-like basis, volumes were down 6 per cent. The division’s operating profits slumped by 39 per cent to €85.5 million this year from €137.3 million in 2011.
The main reason for this was the mild winter weather, particularly in Britain, which accounted for 74 per cent of sales during the year.
Average temperatures in Britain during the quarter ended December 31st were the mildest on record.
During the subsequent three-month period to the end of March, they were “significantly” warmer than the previous year , DCC said yesterday.
DCC Sercom, which distributes IT, communications and home entertainment equipment to retailers, grew sales by almost 17 per cent to €2.2 billion.
Its operating profits increased by 15.7 per cent to €53.2 million from €46 million. The business grew across its three markets: Ireland, Britain and France.
DCC Environmental, which is involved in waste management in Ireland and Britain, turned in the strongest performance, although it is the smallest division in terms of actual sales. These increased 25 per cent to €132.7 million. Operating profits rose 22.6 per cent to €14.2 million.
Its healthcare division, which distributes and sells medical devices and pharmaceuticals, grew operating profits by 4 per cent to €23.4 million.
Operating profits in its food and drink distributor were down 7 per cent at €10.7 million.
