9 November 2021

DCC Delivers Strong Growth in First Half

DCC, the leading international sales, marketing and support services group, today announces its results for the six months ended 30 September 2021.

·    DCC delivered strong growth in the seasonally less significant first half of the year, a very good performance given the strong growth in the comparative period. Operating profit increased by 11.2% (15.5% on a constant currency basis) to £195.8 million and more than half of the constant currency growth was organic. Adjusted earnings per share increased 13.8% to 134.2 pence per share.

·    All divisions delivered growth, despite the global volatility in commodity pricing, supply chains and inflation.  

·    Interim dividend increased by 7.5% to 55.85 pence per share.

·    DCC's financial position remains very strong, with net debt (excluding lease creditors) at 30 September 2021 of £54.1 million.

·    DCC continues to grow and develop organically and through acquisition activity. Since the Group's prior year results announcement in May 2021, DCC has committed approximately £80 million to bolt-on acquisitions, with activity across each division. In the energy sector, acquisitions included the Irish marketing operations of Naturgy, a supplier of renewable power, natural gas and energy services to large commercial and industrial customers and a synergistic, convenience-led, retail mobility business in Luxembourg. DCC Healthcare also completed its first German primary care bolt-on, following its initial market entry through the acquisition of Wörner in April 2021.

·    Notwithstanding the adverse impact of currency translation and the significantly increased wholesale cost of energy products, DCC continues to expect that the year ending 31 March 2022 will be another year of strong operating profit growth and continued development activity, and in line with current market consensus expectations.

Sustainability:

·    Sustainability is embedded in DCC's strategy, business model and culture. DCC released its first standalone Sustainability Report in July 2021. Amongst other items, the report outlines the key metrics the Group will use to track progress against its sustainability objectives. DCC is rated AAA by MSCI.  

·    DCC is making good progress towards achieving a 20% reduction in its own carbon emissions by 2025 from a 2019 base.

·    Progress is being achieved through multiple proactive initiatives. For example, during the first half, DCC has scaled its biofuel usage in a number of businesses for its own truck fleet. DCC is also investing in renewable electricity generation on its sites. For example, DCC Healthcare's soft-gel facility in south Wales generates 50% of its electricity on-site though wind and solar power and utilises its leading sustainability position to attract new customers. 

Energy transition:

·    Leading energy consumers on their transition to renewable or low carbon energy products is central to DCC's purpose, sustainability objectives and strategy. DCC continues to introduce innovative energy solutions for its commercial and industrial, residential, and mobility customers. For example, since May 2021, DCC has:

-    Accelerated the growth of the recently-acquired solar offering in France, beginning to cross-sell other energy solutions to those customers;

-    Launched an energy management service for French B2B power customers, to help customers better understand, monitor and lower their energy usage and also launched an 'on-premise' electric vehicle ('EV') charging offering for office and apartment buildings;

-    Further increased the scale of renewable energy solutions provided in the Irish market through the recent acquisition of Naturgy. All of the electricity DCC sells to customers in Ireland is renewable;

-    Launched a new offering to trial a 100% biofuel solution for residential heating in Britain this winter, which can offer customers an c.85% reduction in carbon; and

-    Recently announced a new partnership with ENGIE to roll out EV fast-charging across DCC's French motorway network.

·    DCC is investing in its capability in new energy solutions. As a result, DCC has a strong pipeline of initiatives right across its energy activities. Together with existing offerings, these will provide energy consumers with further solutions to assist with the decarbonisation of their energy usage into the future.

Donal Murphy, Chief Executive, commented:

"I am pleased to report a strong performance in the seasonally less significant first half, which builds on the growth recorded during the first half of the prior year. Each of our four divisions has delivered good growth, underlining the resilience of our business model and our ability to adapt to the very volatile macro environment. Sustainability is core to how we do business, and we continue to make good progress across each of our four sustainability pillars, including within energy transition. During the period we have developed a number of new partnerships with energy suppliers, bringing innovative and lower-carbon solutions to our customers. DCC is well positioned to lead our customers through their energy transition.

With the strength of our market positions and an active acquisition pipeline, DCC has the capability and financial strength to continue the growth and development of the Group across the energy, healthcare and technology sectors."

Contact information

Investor enquiries:

Kevin Lucey, Chief Financial Officer                                                                                          Tel: +353 1 2799 400

Rossa White, Head of Group Investor Relations                                                  Email: investorrelations@dcc.ie

Media enquiries:

Powerscourt (Eavan Gannon/Victoria Palmer Moore)                                                         Tel: +44 20 7250 1446

          Email: DCC@powerscourt‐group.com

DCC website:                                                                                                                                                                  

www.dcc.ie                                                                                                                  

Presentation of results - audio webcast and conference call details:

DCC will host a live audio webcast and conference call of the presentation at 09.00 today. The slides for this presentation can be downloaded from DCC's website, www.dcc.ie. The access details for the live presentation are as follows:

Ireland:              +353 (0) 1 506 0650         

UK:                      +44 (0) 2071 928 338       

International:    +44 (0) 2071 928 338

Passcode:           7839245                               

Webcast Link:    https://edge.media-server.com/mmc/p/uihow8cz

This report, presentation slides and a replay of the audio will be made available at www.dcc.ie.

Divisional Performance Reviews

DCC LPG delivered strong operating profit growth in the seasonally less significant first half of the financial year, notwithstanding the substantial increase in the wholesale cost of product during the period. Operating profit increased by 6.2% (9.6% ahead on a constant currency basis) to £48.4 million and over half of the constant currency growth was organic.

As anticipated, volumes recovered across most markets during the first half of the year, driven by the reopening of economies and the corresponding increase in commercial activity. DCC LPG sold 918.4k tonnes of product in the first half, a 26.4% increase on the prior year. As expected, operating profit per tonne reduced due to the mix impact of the significant increase in lower margin commercial and industrial customer demand, the impact of the UPG acquisition in the US and the higher cost of product.  

The French business performed in line with expectations, benefiting from continued good cylinder and domestic demand. The recently acquired solar photovoltaic businesses have performed well since acquisition and experienced strong demand for their design, build and maintenance solutions. These acquisitions have continued to broaden the energy solutions the business offers to customers in France and are delivering strong returns on capital employed. The B2B gas and power business also expanded its customer base and the range of energy solutions it provides during the first half, although, as with the LPG sector, the higher cost of energy was a headwind throughout the period.

In Britain and Ireland, the business experienced a strong recovery in commercial volumes. The growth in commercial volumes was supported by momentum in Britain in oil to LPG conversions, relative to the pandemic-affected prior year. Oil to LPG customer volumes are well ahead of where they were prior to the pandemic, as commercial and industrial customers are increasingly attracted to solutions that significantly reduce their carbon footprint. In Ireland, similar to the experience in France, the on-grid gas and power business has faced significant volatility and increases in wholesale prices for natural gas and electricity. DCC LPG recently agreed to acquire Naturgy's power and gas marketing operations in Ireland, a business supplying renewable power, gas and energy services to large energy users. The acquisition enhances DCC's presence in the Irish electricity and gas markets and represents an important step in its strategy to expand its energy solutions offering across the island of Ireland.

In the US, the business recorded very strong volume growth, driven by the acquisitions of NES Group (September 2020) and UPG (January 2021). The integration of both businesses has progressed well, and they have traded in line with expectations. The business continued to build its market position during the period and recently acquired another small business in Denver, Colorado. DCC LPG now has a substantial business in the US, operating across 22 states. Overall, the business in the US performed in line with expectations during the first half.

In Benelux, the business completed the acquisition of Primagaz in June of this year, following receipt of competition authority approval. Integration is progressing well, and the acquisition significantly increases DCC LPG's position in the market, by adding over 10,000 customers. The business in Germany benefited from three small bolt-on acquisitions completed during the first half of the year, one in refrigerants and two in LPG, as it expands its footprint in the sizeable and fragmented German market.

Following a very strong performance in the first half of the prior year, DCC Retail & Oil again delivered strong growth. Operating profit increased by 7.4% (9.5% on a constant currency basis), almost all of which was organic, driven by the recovery in commercial and transport volumes. DCC Retail & Oil also made good progress in expanding the range of products and services it offers to its customers and continued to build capability in lower emissions fuels, EV fast-charging and related services.

DCC Retail & Oil sold 5.681 billion litres of product in the first half, a 16.5% increase on the prior year. Commercial, industrial and transport volumes increased significantly, particularly in the first quarter, as the easing of Covid-19 restrictions led to economic activity recovering, relative to the prior year. The business continues to broaden its product and service offering to customers, which has benefited operating margins generally in recent years. Operating profit per litre decreased modestly due to the mix impact of the recovery in lower-margin, higher-volume commercial activity.

The business in Britain and Ireland recorded very strong organic operating profit growth, in part due to the recovery in commercial activity, which drove fuel and fuel card usage. The business also delivered good growth in its expanded network of company operated retail sites and stores. The increased range of customer solutions is becoming more material, and in the first half of the year, good growth was achieved across lubricants, truck stop, roadside services and heating services. The business in Britain also recently completed the acquisitions of two small bolt-on acquisitions which will improve its digital capability and further expand the roadside services offerings. The business in Ireland delivered strong organic growth in the first half of the year and benefited from the integration of two modest acquisitions completed during the last twelve months.

The Scandinavian business performed robustly following an excellent performance in the prior year. The business in Denmark in particular performed well and generated good growth across the retail, agricultural and commercial sectors. In Scandinavia generally, the business continued to deploy capital into expanding its presence in lower emissions fuels and EV charging infrastructure, including winning a tender for a transport mobility hub in Norway. 

In France, the business recorded very strong growth, as restrictions lifted and retail mobility consumers were increasingly active. It has also made good progress in offering new products and solutions to mobility customers. The business has entered into a partnership with ENGIE to deploy EV chargers on 14 motorway sites, while rolling out the infrastructure to enable the sale of E85 fuel across its network. E85 offers a lower carbon alternative product for retail mobility customers. In September 2021, the business also acquired a synergistic network of 19 convenience-led retail forecourts in Luxembourg. The acquisition will be fully integrated into DCC Retail & Oil's existing mobility operating platform and, although modest, will add a good company-operated convenience retailing capability.

DCC Healthcare delivered another excellent performance in the first half of the financial year, generating operating profit growth of 26.0% (29.8% on a constant currency basis), approximately two-thirds of which was organic. DCC Vital generated excellent organic profit growth and benefited from the acquisition earlier in the year of Wörner, a leading primary care supplier in Germany and Switzerland. DCC Health & Beauty Solutions also performed well, growing its operating profit and building on the excellent growth in the first half of the prior year.

DCC Health & Beauty Solutions, which provides outsourced solutions to international nutrition and beauty brand owners, achieved good profit growth, driven by strong growth in Europe. The performance in Europe was driven by strong growth in sales of 'beauty from within' nutrition and premium skincare products. Sales growth in the US market was more modest, following excellent growth in the prior year, as consumer demand normalised towards longer-term growth trends. 

DCC Health & Beauty Solutions continued to invest in its management resources during the period, particularly in the US where a new divisional team has been established. It also expanded its capacity and capability across its manufacturing facilities, including recently adding nutritional gummy manufacturing in Britain.

DCC Vital, which is focused on the sales and marketing of medical products to healthcare providers, generated excellent revenue and operating profit growth. In the British and Irish markets DCC Vital is well positioned to benefit from an increase in routine hospital procedures and in-person GP consultations, which have yet to normalise as the pandemic continues to impact healthcare systems. The business continued to service the healthcare systems with the supply of pandemic-related PPE and related products.

DCC Vital also benefited from the first-time contribution of Wörner, acquired in April 2021. This acquisition establishes a continental European growth platform for DCC Vital in primary care and builds on DCC Vital's leadership position in this sector in Britain. Wörner performed ahead of expectations in the first half of the financial year, benefiting from the distribution of antigen tests into the nursing home sector. The business also completed a small bolt-on acquisition in the first quarter, further expanding its footprint in the German market.    

DCC Technology delivered good profit growth in the first half of the year, despite the well-documented global supply chain disruption being experienced by the technology industry and its impact on product availability. The business recorded operating profit growth of 6.5% (19.0% on a constant currency basis) in the seasonally less significant first half of the financial year and approximately one-third of the constant currency growth was organic. The business performed very strongly in North America across both the consumer and B2B sectors, where the economy reopened earlier than in Europe. This very strong performance more than compensated for a challenging environment for the UK business.

Overall, the business recorded modest revenue growth in the period. Trading conditions in higher-margin B2B sectors, such as Pro AV products, improved as economies re-opened. Demand for higher-volume, lower-margin consumer and working-from-home products generally remained relatively robust, although activity was somewhat constrained by supply disruption, particularly in the UK.

The North American business performed very strongly in the first half of the year and delivered very good organic revenue and profit growth across Pro Audio, Pro AV and consumer products. As expected, the B2B Pro AV sector recovered strongly as Covid-19 restrictions eased and activity in areas such as corporate hospitality, education and healthcare returned towards pre-pandemic levels. The business also benefited from the first-time contribution from the two modest bolt-on acquisitions completed in the prior year, both of which have performed well since acquisition.

In the UK, revenue and operating profit declined. The UK business is experiencing the most product supply disruption, with labour availability and logistics challenges also being most acute in this market. The business was also impacted by the planned implementation of a new warehouse management system in the second quarter. In Ireland, the business recorded good organic revenue and operating profit growth in the first half of the financial year. It also moved to a new, larger, warehouse and office facility during the period, which will facilitate the continued growth and development of the business in the Irish market.

In Continental Europe, DCC Technology generated good revenue and profit growth in the period. As in North America, the business has experienced a recovery in the demand environment for B2B products generally, although the rate of recovery has varied across markets. The business performed well in the Benelux region and delivered good growth in the Nordics, where it also recently acquired a modest bolt-on acquisition in the AV sector. The performance in the B2B sector benefited from the completion of the acquisition of Azenn during the period, a French distributor of structured cabling solutions and network devices to the French installation market. Azenn, which has performed well since acquisition, is complementary to the existing French B2B offering. 

Group Financial Review

A summary of the Group's results for the six months ended 30 September 2021 is as follows:

Income Statement Review

Reporting currency

The Group's financial statements are presented in sterling, denoted by the symbol '£'. The principal exchange rates used for the translation of results into sterling are set out in note 4, Reporting Currency, on page 23.

The net impact of currency translation on the Group income statement versus the prior period was relatively significant, accounting for a headwind of approximately 4% to the reported growth in operating profit. Average sterling exchange rates strengthened against most relevant currencies, including the US dollar and euro.

Revenue

Overall, Group revenue increased by 26.8% (29.7% increase on a constant currency basis) to £7.518 billion.

DCC LPG sold 918.4k tonnes of product in the first half of the year, a 26.4% increase versus the prior year. Volumes recovered across all markets, driven by the reopening of economies and the corresponding increase in commercial and industrial activity. 

DCC Retail & Oil sold 5.7 billion litres of product in the first half, a 16.5% increase versus the prior year driven by the recovery of commercial, industrial and transport volumes, particularly in the first quarter.

Combined revenue in DCC Healthcare and DCC Technology was £2.4 billion, an increase of 3.4% reflecting a strong revenue performance in DCC Healthcare and DCC Technology's North American businesses.

Group adjusted operating profit

Group adjusted operating profit increased by 11.2% to £195.8 million (15.5% ahead on a constant currency basis), in the seasonally less significant first half of the year. More than half of the constant currency growth was organic, a strong performance in the context of well-documented challenges in global commodity prices, supply chain shortages and labour availability.

DCC LPG traded strongly during the first half of the year, particularly given the significant increase in the cost of product. Operating profit increased by 6.2% (9.6% ahead on a constant currency basis) to £48.4 million, over half of which was organic.

Operating profit in DCC Retail & Oil was well ahead of the prior year driven by the anticipated recovery in commercial and transport volumes. Operating profit increased 7.4% to £70.0 million (9.5% ahead on a constant currency basis), almost all of which was organic.

DCC Healthcare delivered another excellent performance in the first half of the year, generating operating profit growth of 26.0% to £50.2 million (29.8% on a constant currency basis), approximately two-thirds of which was organic. DCC Vital generated very strong organic growth and benefited from the acquisition of Wörner in April 2021.  

DCC Technology traded strongly, and operating profit increased 6.5% to £27.2 million (19.0% ahead on a constant currency basis) and approximately one-third of the constant currency growth was organic. The growth was driven by the consumer and B2B sectors in North America, which performed very well.

Finance costs (net) and other

Net finance and other costs decreased to £26.9 million (2020: £30.2 million). The decrease primarily reflects a lower interest charge due to lower average gross debt balances, following a private placement debt repayment in May 2021. Average net debt, excluding lease creditors, in the period was £211 million, compared to an average net debt of £223 million in the prior year. The slight decrease in average net debt excluding lease creditors reflects lower levels of working capital across the first six months of the year.

Profit before net exceptional items, amortisation of intangible assets and tax

Profit before net exceptional items, amortisation of intangible assets and tax increased by 15.7% to £168.9 million. 

Net exceptional items and amortisation of intangible assets

The Group recorded a net exceptional charge after tax of £17.5 million in the first six months of the year as follows:

Adjustments to contingent acquisition consideration reflects an increase in the provision for deferred consideration likely payable in respect of two acquisitions in DCC Technology where the trading performance in North America has been very strong and ahead of expectations. In accordance with IFRS 3, this increase in the fair value of contingent consideration is recognised as a charge in the Income Statement.

Acquisition and related costs include the professional fees and tax costs relating to the evaluation and completion of acquisition opportunities and amounted to £5.8 million.

Restructuring and integration costs and other of £4.5 million relates to the restructuring and integration of operations across a number of businesses and acquisitions. The most material item relates to DCC LPG, where a project is underway in France to enhance the efficiency of its operating infrastructure.

The level of ineffectiveness calculated under IAS 39 on the hedging instruments related to the Group's US private placement debt is charged or credited as an exceptional item. In the six months ended 30 September 2021, this amounted to an exceptional non-cash gain of £1.0 million. The cumulative net exceptional credit taken in respect of IAS 39 ineffectiveness is £0.3 million. This, or any subsequent similar non-cash charges or gains, will net to zero over the remaining term of this debt and the related hedging instruments.

The charge for the amortisation of acquisition related intangible assets increased to £36.6 million from £30.5 million in the prior year, with the increase primarily reflecting acquisitions completed during the second half of the prior year.

Profit before tax

Profit before tax increased to £115.0 million.

Taxation

The effective tax rate for the Group in the first half of the year of 18.0% is based on the anticipated mix of profits for the full year and compares to a full year effective tax rate in the prior year of 17.0%.

Adjusted earnings per share

Adjusted earnings per share increased by 13.8% to 134.2 pence, reflecting the increase in profit before exceptional items and goodwill amortisation.

Dividend

The Board has decided to pay an interim dividend of 55.85 pence per share, which represents a 7.5% increase on the prior year interim dividend of 51.95 pence per share. This dividend will be paid on 10 December 2021 to shareholders on the register at the close of business on 19 November 2021.

Cash Flow, Development & Financial Position

Cash flow  

As with its operating profit, the Group's operating cash flow is significantly weighted towards the second half of the year. The cash flow of the Group for the six months ended 30 September 2021 can be summarised as follows:

The working capital performance of the Group continues to be strong, with the working capital position at 30 September 2021 comparing favourably to the prior year and in line with expectations. The absolute value of working capital at 30 September 2021 was a negative £25.2 million versus £1.0 million (positive) at 30 September 2020.

This good performance reflects a very strong underlying working capital performance in DCC Retail & Oil, which benefited from the increased activity levels. The uncertain supply chain environment saw both the Healthcare and Technology divisions invest in working capital versus the prior year to ensure service levels to customers. Overall working capital days at 30 September 2021 were negative 0.5 days sales, a slight improvement on the prior year (2020: 0.0 days sales). DCC Technology selectively uses supply chain financing solutions to sell, on a non-recourse basis, a portion of its receivables relating to certain larger supply chain/sales and marketing activities. As anticipated, the level of supply chain financing at 30 September 2021 was lower than the prior year at £125.9 million (2020: £223.4 million), with the decrease reflecting the lower volume throughput in in the UK business following the warehouse system upgrades and product supply disruption. Supply chain financing had a positive impact on Group working capital days of 2.0 days (30 September 2020: 5.2 days).

As expected, working capital increased by £183.2 million over the six-month period from 31 March 2021 due to the reversal of approximately £80 million of one-off timing benefits which were highlighted in the Results Announcement in May 2021, lower utilisation of supply chain financing and the investment in the Group's typical seasonal working capital requirements.

Net capital expenditure for the six months amounted to £67.0 million (2020: £87.6 million), was net of disposal proceeds of £11.1 million, and reflects continued investment in development initiatives across the Group.

Capital expenditure in DCC LPG primarily comprised development expenditure on tanks, cylinders and installations, supporting new business, the conversion of oil customers to LPG, and the continued rollout of bioLPG cylinders and 'Click and Collect' services. There was also continued development spend in relation to the Avonmouth LPG storage facility in the UK. In the Retail & Oil division, there was continued investment in new retail sites and site upgrades, including adding further lower emission product capability, EV fast charging and related services. It also included capital expenditure in relation to the ongoing project to optimise the depot network in the UK to bring greater network and capital efficiency over time. In DCC Healthcare, the capital expenditure primarily related to increased manufacturing capability across DCC Health & Beauty Solutions in both Europe and the US, to facilitate the strong growth in customer demand.  The majority of the capital expenditure in DCC Technology related to the new warehouse management system which is now live in the UK, along with development spend in Ireland to relocate to a new, larger, office and warehouse facility during the period.

Net capital expenditure was broadly in line with the depreciation charge of £68.9 million (excluding right-of-use leased assets) in the period. 

Free cash flow in the six months ended 30 September 2021 of £12.3 million compares to £120.7 million in the prior year, with the reduction substantially due to the reversal of the one-off timing benefits to working capital at 31 March 2021.

Total cash spend on acquisitions in the six months to 30 September 2021

The total cash spend on acquisitions in the six months ended 30 September 2021 was £162.4 million. This included the completion of the acquisition of Wörner in DCC Healthcare, Primagaz and Solewa in DCC LPG, Jones Ireland in DCC Retail & Oil and Azenn in DCC Technology which were announced in the prior year Results Announcement in May 2021. Payment of deferred and contingent acquisition consideration previously provided amounted to £21.1 million.

Committed acquisition and capital expenditure

Committed acquisition and capital expenditure in the period amounted to £144.8 million as follows:

Acquisition activity

The Group continues to be active from a development perspective. Acquisition expenditure committed by the Group since the prior year results announcement on 18 May 2021 amounted to £77.7 million and included:

DCC LPG

Naturgy Ireland

In November 2021, DCC LPG agreed to acquire Naturgy's Irish power and gas marketing operations, subject to competition approval in Ireland. The business is a service-led supplier of electricity and gas to large B2B energy customers and also provides a range of services including demand side management, lighting as a service, solar PV and PPA management. Founded in 2004, the business has a long track record of sourcing and supplying renewable power to industrial and commercial customers and was the first company in Ireland to supply 100% renewable electricity. The acquisition enhances DCC's presence in the Irish electricity and gas markets and represents an important step in its strategy to expand its energy solutions offering across the island of Ireland. The acquisition is expected to complete by the end of the calendar year.

DCC LPG recently completed a small bolt-on acquisition in the Denver region of Colorado, further expanding its presence in the US propane market and also completed a number of modest acquisitions in the German and Austrian markets.

DCC Retail & Oil

Luxembourg retail convenience network

DCC Retail & Oil acquired a network of 19 retail sites in Luxembourg in September 2021. The sites will be managed by DCC's existing French management team and the network and operations centre in Ireland. Most of the sites are Gulf branded, with established convenience retail operations under the leading Cactus Shoppi brand, which DCC will operate. The network contains well-located, urban sites, suitable for investment in EV fast charging infrastructure in the future.

In Britain, DCC Retail & Oil completed a number of complementary bolt-on acquisitions including a HGV service business, offering multiple services to hauliers including secure parking, fuel provision, truck washing facilities and accommodation.

DCC Retail & Oil also completed a small bolt-on acquisition in the bulk fuels and lubricants market in Norway.  

DCC Healthcare

In June 2021, DCC Healthcare completed its first primary care bolt-on acquisition in Germany following its initial market entry through the Wörner acquisition in April 2021.         

DCC Technology

DCC Technology recently acquired a small business in the Nordics which distributes AV and security camera equipment, further enhancing DCC Technology's service offering to its customers in the region.

Financial strength

An integral part of the Group's strategy is the maintenance of a strong and liquid balance sheet which, among other benefits, enables it to take advantage of development opportunities as they arise. The increasing scale and geographic diversity of DCC will enable the Group to evolve its approach somewhat into the future, leveraging a broader array of funding options and, over time, reducing relative levels of gross cash on the balance sheet. At 30 September 2021, the Group had net debt (excluding lease creditors) of £54.1 million, cash of approximately £1.3 billion and undrawn committed bank facilities of £400 million. Lease creditors at the same date amounted to £336.2 million.

The Group's outstanding term debt at 30 September 2021, which has been raised in the US private placement market, had an average maturity of 5.0 years, with an implied average credit margin of 1.65% over Euribor/Libor.

Outlook

Notwithstanding the adverse impact of currency translation and the significantly increased wholesale cost of energy products, DCC continues to expect that the year ending 31 March 2022 will be another year of strong operating profit growth and continued development activity, and in line with current market consensus expectations.

Forward-looking statements

This announcement contains some forward-looking statements that represent DCC's expectations for its business, based on current expectations about future events, which by their nature involve risk and uncertainty. DCC believes that its expectations and assumptions with respect to these forward-looking statements are reasonable; however, because they involve risk and uncertainty as to future circumstances, which are in many cases beyond DCC's control, actual results or performance may differ materially from those expressed in or implied by such forward-looking statements.

Principal risks and uncertainties

The Board of DCC is responsible for the Group's risk management and internal control systems, which are designed to identify, manage and mitigate potential material risks to the achievement of the Group's strategic and business objectives. The Board has approved a Risk Management Policy which sets out delegated responsibilities and procedures for the management of risk across the Group.

The principal risks and uncertainties facing the Group in the short to medium term, as set out on pages 85 to 89 of the 2021 Annual Report (together with the principal mitigation measures), continue to be the principal risks and uncertainties facing the Group for the remaining six months of the financial year.

This is not an exhaustive statement of all relevant risks and uncertainties. Matters which are not currently known to the Board or events which the Board considers to be of low likelihood could emerge and give rise to material consequences. The mitigation measures that are maintained in relation to these risks are designed to provide a reasonable and not an absolute level of protection against the impact of the events in question.