Results for the six months ended 30 September 2021

RNS Number : 7214R

DCC PLC

09 November 2021

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.

Financial highlights:	2021	2020	% change	% change CC¹
Revenue	£7.518bn	£5.931bn	+26.8%	+29.7%
Adjusted operating profit²	£195.8m	£176.1m	+11.2%	+15.5%
DCC LPG	£48.4m	£45.6m	+6.2%	+9.6%
DCC Retail & Oil	£70.0m	£65.2m	+7.4%	+9.5%
DCC Healthcare	£50.2m	£39.8m	+26.0%	+29.8%
DCC Technology	£27.2m	£25.5m	+6.5%	+19.0%
Adjusted earnings per share²	134.2p	117.9p	+13.8%	+18.3%
Interim dividend	55.85p	51.95p	+7.5%
Net debt (excl. lease creditors)³	£54.1m	£137.2m

· 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.

1 Constant currency ('CC') represents the retranslation of foreign denominated current year results at prior year exchange rates

2 Excluding net exceptionals and amortisation of intangible assets

3 Net debt including lease creditors at 30 September 2021 was £390.3 million (2020: £441.0 million)

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.

Document contents	Pages

Divisional Performance Reviews	4 - 7
Group Financial Review	8
Income Statement Review	9 - 11
Cash Flow, Development & Financial Position	12 - 16
Interim Financial Statements (Condensed)	17 - 35
Alternative Performance Measures	36 - 39

Divisional Performance Reviews

DCC LPG	2021	2020	% change	% change CC
Volumes (thousand tonnes)	918.4kT	726.3kT	+26.4%
Operating profit	£48.4m	£45.6m	+6.2%	+9.6%
Operating profit per tonne	£52.67	£62.72

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.

DCC Retail & Oil	2021	2020	% change	% change CC
Volumes (billion litres)	5.681bn	4.8.76bn	+16.5%
Operating profit	£70.0m	£65.2m	+7.4%	+9.5%
Operating profit per litre	1.23ppl	1.34ppl

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	2021	2020	% change	% change CC
Revenue	£384.2m	£322.0m	+19.3%	+22.9%
Operating profit	£50.2m	£39.8m	+26.0%	+29.8%
Operating margin	13.1%	12.4%

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	2021	2020	% change	% change CC
Revenue	£1.985bn	£1.969bn	+0.8%	+3.7%
Operating profit	£27.2m	£25.5m	+6.5%	+19.0%
Operating margin	1.4%	1.3%

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:

	2021	2020
	£'m	£'m	% change

Revenue	7,518	5,931	+26.8%
Adjusted operating profit¹
DCC LPG	48.4	45.6	+6.2%
DCC Retail & Oil	70.0	65.2	+7.4%
DCC Healthcare	50.2	39.8	+26.0%
DCC Technology	27.2	25.5	+6.5%
Group adjusted operating profit¹	195.8	176.1	+11.2%
Finance costs (net) and other	(26.9)	(30.2)
Profit before net exceptionals, amortisation of intangible assets and tax	168.9	145.9	+15.7%
Net exceptional items before tax	(17.3)	(13.3)
Amortisation of intangible assets	(36.6)	(30.5)
Profit before tax	115.0	102.1
Taxation	(24.3)	(18.5)
Profit after tax	90.7	83.6
Non-controlling interests	(6.2)	(5.0)
Attributable profit	84.5	78.6
Adjusted earnings per share¹	134.2 pence	117.9 pence	+13.8%
Dividend per share	55.85 pence	51.95 pence	+7.5%
Free cash flow²	12.3	120.7

Net debt at 30 September (excluding lease creditors)	54.1	137.2
Lease creditors	336.2	303.8
Net debt at 30 September (including lease creditors)	390.3	441.0
¹Excluding net exceptionals and amortisation of intangible assets ²After net working capital and net capital expenditure but before net exceptionals, interest and tax payments

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:

	£'m
Adjustments to contingent acquisition consideration	8.0
Acquisition and related costs	5.8
Restructuring and integration costs and other	4.5
IAS 39 mark-to-market gain	(1.0)
	17.3
Tax attaching to exceptional items	0.2
Net exceptional charge	17.5

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:

Six months ended 30 September	2021	2020
	£'m	£'m

Group operating profit	195.8	176.1

Increase in working capital	(183.2)	(28.4)
Depreciation (excluding ROU leased assets) and other	70.2	63.8

Operating cash flow (pre add-back for depreciation on ROU leased assets)	82.8	211.5

Capital expenditure (net)	(67.0)	(87.6)
	15.8	123.9

Depreciation on ROU leased assets	32.4	29.9
Repayment of lease creditors	(35.9)	(33.1)
Free cash flow	12.3	120.7

Interest and tax paid, net of dividend from equity accounted investments	(53.4)	(42.0)

Free cash flow (after interest and tax)	(41.1)	78.7

Acquisitions	(162.4)	(98.5)
Dividends	(106.8)	(92.5)
Exceptional items	(9.8)	(19.2)
Share issues	0.4	-

Net outflow	(319.7)	(131.5)

Opening net debt	(150.2)	(367.1)
Translation and other	79.6	57.6
Closing net debt (including lease creditors)	(390.3)	(441.0)


Analysis of closing net debt (including lease creditors):
Net debt at 30 September (excluding lease creditors)	(54.1)	(137.2)
Lease creditors at 30 September	(336.2)	(303.8)
	(390.3)	(441.0)

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:

	Acquisitions	Capex	Total
	£'m	£'m	£'m
DCC LPG	33.9	36.3	70.2
DCC Retail & Oil	36.8	16.7	53.5
DCC Healthcare	5.8	7.0	12.8
DCC Technology	1.2	7.1	8.3
Total	77.7	67.1	144.8

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.

Group Income Statement

		Unaudited 6 months ended			Unaudited 6 months ended			Audited year ended
		30 September 2021			30 September 2020			31 March 2021
		Pre exceptionals	Exceptionals (note 6)	Total	Pre exceptionals	Exceptionals (note 6)	Total	Pre exceptionals	Exceptionals (note 6)	Total
	Notes	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000

Revenue	5	7,518,329	-	7,518,329	5,931,094	-	5,931,094	13,412,450	-	13,412,450
Cost of sales		(6,621,722)	-	(6,621,722)	(5,140,742)	-	(5,140,742)	(11,592,970)	-	(11,592,970)
Gross profit		896,607	-	896,607	790,352	-	790,352	1,819,480	-	1,819,480
Administration expenses		(280,674)	-	(280,674)	(250,582)	-	(250,582)	(499,812)	-	(499,812)
Selling and distribution expenses		(430,615)	-	(430,615)	(375,131)	-	(375,131)	(814,758)	-	(814,758)
Other operating income/(expenses)		10,463	(18,305)	(7,842)	11,459	(14,703)	(3,244)	25,333	(40,495)	(15,162)
Adjusted operating profit		195,781	(18,305)	177,476	176,098	(14,703)	161,395	530,243	(40,495)	489,748
Amortisation of intangible assets		(36,566)	-	(36,566)	(30,534)	-	(30,534)	(66,898)	-	(66,898)
Operating profit	5	159,215	(18,305)	140,910	145,564	(14,703)	130,861	463,345	(40,495)	422,850
Finance costs		(39,355)	-	(39,355)	(45,070)	-	(45,070)	(85,639)	-	(85,639)
Finance income		12,056	967	13,023	14,819	1,406	16,225	26,253	1,384	27,637
Equity accounted investments' profit after tax		390	-	390	62	-	62	233	-	233
Profit before tax		132,306	(17,338)	114,968	115,375	(13,297)	102,078	404,192	(39,111)	365,081
Income tax expense	7	(24,089)	(184)	(24,273)	(18,254)	(226)	(18,480)	(66,382)	4,104	(62,278)
Profit after tax for the financial period		108,217	(17,522)	90,695	97,121	(13,523)	83,598	337,810	(35,007)	302,803

Profit attributable to:
Owners of the Parent Company		102,029	(17,522)	84,507	92,137	(13,523)	78,614	327,626	(35,007)	292,619
Non-controlling interests		6,188	-	6,188	4,984	-	4,984	10,184	-	10,184
		108,217	(17,522)	90,695	97,121	(13,523)	83,598	337,810	(35,007)	302,803
Earnings per ordinary share
Basic earnings per share	8			85.71p			79.83p			297.04p
Diluted earnings per share	8			85.66p			79.70p			296.62p
Adjusted basic earnings per share	8			134.24p			117.93p			386.62p
Adjusted diluted earnings per share	8			134.16p			117.74p			386.07p

Group Statement of Comprehensive Income


	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000

Group profit for the period	90,695	83,598	302,803

Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Currency translation	17,481	19,388	(53,527)
Movements relating to cash flow hedges	105,035	54,668	67,961
Movement in deferred tax liability on cash flow hedges	(19,065)	(9,294)	(11,554)
	103,451	64,762	2,880
Items that will not be reclassified to profit or loss
Group defined benefit pension obligations:
- remeasurements	(2,747)	(1,950)	254
- movement in deferred tax asset	494	332	159
	(2,253)	(1,618)	413

Other comprehensive income for the period, net of tax	101,198	63,144	3,293

Total comprehensive income for the period	191,893	146,742	306,096

Attributable to:
Owners of the Parent Company	185,077	140,021	298,172
Non-controlling interests	6,816	6,721	7,924

	191,893	146,742	306,096

Group Balance Sheet


		Unaudited	Unaudited	Audited
		30 Sept.	30 Sept.	31 March
		2021	2020	2021
	Notes	£'000	£'000	£'000
ASSETS
Non-current assets
Property, plant and equipment		1,171,866	1,132,586	1,137,634
Right-of-use leased assets		328,432	298,533	308,863
Intangible assets and goodwill		2,343,529	2,186,447	2,206,735
Equity accounted investments		26,891	28,937	27,134
Deferred income tax assets		30,974	35,975	30,706
Derivative financial instruments		126,079	178,094	121,671
		4,027,771	3,860,572	3,832,743

Current assets
Inventories		941,545	756,464	685,950
Trade and other receivables		1,557,229	1,434,777	1,689,372
Derivative financial instruments		150,744	33,389	40,181
Cash and cash equivalents		1,437,725	1,574,329	1,786,556
		4,087,243	3,798,959	4,202,059

Total assets		8,115,014	7,659,531	8,034,802

EQUITY
Capital and reserves attributable to owners of the Parent Company
Share capital		17,422	17,422	17,422
Share premium		883,318	882,912	882,924
Share based payment reserve	10	44,531	38,625	40,969
Cash flow hedge reserve	10	99,100	2,097	13,130
Foreign currency translation reserve	10	77,113	129,178	60,260
Other reserves	10	932	932	932
Retained earnings		1,607,747	1,466,814	1,631,797
Equity attributable to owners of the Parent Company		2,730,163	2,537,980	2,647,434
Non-controlling interests		66,582	61,486	58,210
Total equity		2,796,745	2,599,466	2,705,644

LIABILITIES
Non-current liabilities
Borrowings		1,568,450	1,716,427	1,553,200
Lease creditors		275,859	256,747	261,617
Derivative financial instruments		-	687	652
Deferred income tax liabilities		198,237	186,612	183,220
Post employment benefit obligations	13	(5,517)	(5,604)	(8,024)
Provisions for liabilities		282,641	265,880	279,492
Acquisition related liabilities		74,942	67,804	62,549
Government grants		367	324	373
		2,394,979	2,488,877	2,333,079

Current liabilities
Trade and other payables		2,548,083	2,202,991	2,604,177
Current income tax liabilities		41,744	44,517	44,081
Borrowings		147,108	193,999	219,659
Lease creditors		60,322	47,009	53,607
Derivative financial instruments		53,140	11,896	9,843
Provisions for liabilities		47,723	48,062	42,859
Acquisition related liabilities		25,170	22,714	21,853
		2,923,290	2,571,188	2,996,079
Total liabilities		5,318,269	5,060,065	5,329,158

Total equity and liabilities		8,115,014	7,659,531	8,034,802

Net (debt)/cash included above (excluding lease creditors)	11	(54,150)	(137,197)	165,054

Group Statement of Changes in Equity


For the six months ended 30 September 2021	Attributable to owners of the Parent Company
				Other		Non-
	Share	Share	Retained	reserves		controlling	Total
	capital	premium	earnings	(note 10)	Total	interests	equity
	£'000	£'000	£'000	£'000	£'000	£'000	£'000

At 1 April 2021	17,422	882,924	1,631,797	115,291	2,647,434	58,210	2,705,644

Profit for the period	-	-	84,507	-	84,507	6,188	90,695
Currency translation	-	-	-	16,853	16,853	628	17,481
Group defined benefit pension obligations:
- remeasurements	-	-	(2,747)	-	(2,747)	-	(2,747)
- movement in deferred tax asset	-	-	494	-	494	-	494
Movements relating to cash flow hedges	-	-	-	105,035	105,035	-	105,035
Movement in deferred tax liability on cash flow hedges	-	-	-	(19,065)	(19,065)	-	(19,065)
Total comprehensive income	-	-	82,254	102,823	185,077	6,816	191,893
Re-issue of treasury shares	-	394	-	-	394	-	394
Share based payment	-	-	-	3,562	3,562	-	3,562
Non-controlling interest arising on acquisition	-	-	-	-	-	2,058	2,058
Dividends	-	-	(106,304)	-	(106,304)	(502)	(106,806)
At 30 September 2021	17,422	883,318	1,607,747	221,676	2,730,163	66,582	2,796,745


For the six months ended 30 September 2020	Attributable to owners of the Parent Company
				Other		Non-
	Share	Share	Retained	reserves		controlling	Total
	capital	premium	earnings	(note 10)	Total	interests	equity
	£'000	£'000	£'000	£'000	£'000	£'000	£'000

At 1 April 2020	17,422	882,887	1,482,288	104,096	2,486,693	54,765	2,541,458

Profit for the period	-	-	78,614	-	78,614	4,984	83,598
Currency translation	-	-	-	17,651	17,651	1,737	19,388
Group defined benefit pension obligations:
- remeasurements	-	-	(1,950)	-	(1,950)	-	(1,950)
- movement in deferred tax asset	-	-	332	-	332	-	332
Movements relating to cash flow hedges	-	-	-	54,668	54,668	-	54,668
Movement in deferred tax liability on cash flow hedges	-	-	-	(9,294)	(9,294)	-	(9,294)
Total comprehensive income	-	-	76,996	63,025	140,021	6,721	146,742
Re-issue of treasury shares	-	25	-	-	25	-	25
Share based payment	-	-	-	3,711	3,711	-	3,711
Dividends	-	-	(92,470)	-	(92,470)	-	(92,470)
At 30 September 2020	17,422	882,912	1,466,814	170,832	2,537,980	61,486	2,599,466
For the year ended 31 March 2021	Attributable to owners of the Parent Company
				Other		Non-
	Share	Share	Retained	reserves		controlling	Total
	capital	premium	earnings	(note 10)	Total	interests	equity
	£'000	£'000	£'000	£'000	£'000	£'000	£'000

At 1 April 2020	17,422	882,887	1,482,288	104,096	2,486,693	54,765	2,541,458

Profit for the period	-	-	292,619	-	292,619	10,184	302,803
Currency translation	-	-	-	(51,267)	(51,267)	(2,260)	(53,527)
Group defined benefit pension obligations:
- remeasurements	-	-	254	-	254	-	254
- movement in deferred tax asset	-	-	159	-	159	-	159
Movements relating to cash flow hedges	-	-	-	67,961	67,961	-	67,961
Movement in deferred tax liability on cash flow hedges	-	-	-	(11,554)	(11,554)	-	(11,554)
Total comprehensive income	-	-	293,032	5,140	298,172	7,924	306,096
Re-issue of treasury shares	-	37	-	-	37	-	37
Share based payment	-	-	-	6,055	6,055	-	6,055
Non-controlling interest arising on acquisition	-	-	-	-	-	323	323
Dividends	-	-	(143,523)	-	(143,523)	(4,802)	(148,325)
At 31 March 2021	17,422	882,924	1,631,797	115,291	2,647,434	58,210	2,705,644

Group Cash Flow Statement


		Unaudited	Unaudited	Audited
		6 months	6 months	year
		ended	ended	ended
		30 Sept.	30 Sept.	31 March
		2021	2020	2021
	Notes	£'000	£'000	£'000
Cash flows from operating activities
Profit for the period		90,695	83,598	302,803
Add back non-operating expenses/(income)
- tax		24,273	18,480	62,278
- share of equity accounted investments' profit		(390)	(62)	(233)
- net operating exceptionals		18,305	14,703	40,495
- net finance costs		26,332	28,845	58,002
Group operating profit before exceptionals		159,215	145,564	463,345
Share-based payments expense		3,562	3,711	6,055
Depreciation (including right-of-use leased assets)		101,428	92,303	192,572
Amortisation of intangible assets		36,566	30,534	66,898
(Profit)/loss on disposal of property, plant and equipment		(3,746)	3	(5,263)
Amortisation of government grants		(9)	(7)	(36)
Other		1,470	(2,344)	2,418
(Increase)/decrease in working capital		(183,210)	(28,375)	177,670
Cash generated from operations before exceptionals		115,276	241,389	903,659
Exceptionals		(10,564)	(19,257)	(29,358)
Cash generated from operations		104,712	222,132	874,301
Interest paid (including lease interest)		(35,281)	(44,989)	(84,342)
Income tax paid		(34,894)	(16,967)	(62,191)
Net cash flows from operating activities		34,537	160,176	727,768

Investing activities
Inflows:
Proceeds from disposal of property, plant and equipment		11,148	1,056	15,898
Proceeds on disposal of equity accounted investment		778	-	-
Government grants received in relation to property, plant and equipment		-	-	89
Interest received		12,033	15,155	27,930
		23,959	16,211	43,917
Outflows:
Purchase of property, plant and equipment		(78,187)	(88,615)	(162,879)
Acquisition of subsidiaries	12	(141,281)	(72,685)	(236,232)
Payment of accrued acquisition related liabilities		(21,140)	(25,801)	(36,330)
		(240,608)	(187,101)	(435,441)
Net cash flows from investing activities		(216,649)	(170,890)	(391,524)

Financing activities
Inflows:
Proceeds from issue of shares		394	25	37
Net cash inflow on derivative financial instruments		31,475	50,697	68,554
Increase in interest-bearing loans and borrowings		-	320,000	320,000
		31,869	370,722	388,591
Outflows:
Repayment of interest-bearing loans and borrowings		(105,166)	(439,185)	(437,612)
Repayment of lease creditors		(31,173)	(28,302)	(59,279)
Dividends paid to owners of the Parent Company	9	(106,304)	(92,470)	(143,523)
Dividends paid to non-controlling interests		(502)	-	(4,802)
		(243,145)	(559,957)	(645,216)
Net cash flows from financing activities		(211,276)	(189,235)	(256,625)

Change in cash and cash equivalents		(393,388)	(199,949)	79,619
Translation adjustment		11,761	9,469	(47,496)
Cash and cash equivalents at beginning of period		1,716,896	1,684,773	1,684,773
Cash and cash equivalents at end of period		1,335,269	1,494,293	1,716,896

Cash and cash equivalents consists of:
Cash and short-term bank deposits	11	1,437,725	1,574,329	1,786,556
Overdrafts	11	(102,456)	(80,036)	(69,660)
		1,335,269	1,494,293	1,716,896

Notes to the Condensed Financial Statements

for the six months ended 30 September 2021

1. Basis of Preparation

The Group condensed interim financial statements which should be read in conjunction with the annual financial statements for the year ended 31 March 2021 have been prepared in accordance with the Transparency (Directive 2004/109/EC) Regulations 2007, the related Transparency rules of the Irish Financial Services Regulatory Authority and in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union.

The preparation of the interim financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of certain assets, liabilities, revenues and expenses together with disclosure of contingent assets and liabilities. Estimates and underlying assumptions are reviewed on an ongoing basis.

These condensed interim financial statements for the six months ended 30 September 2021 and the comparative figures for the six months ended 30 September 2020 are unaudited and have not been reviewed by the Auditors. The summary financial statements for the year ended 31 March 2021 represent an abbreviated version of the Group's full accounts for that year, on which the Auditors issued an unqualified audit report and which have been filed with the Registrar of Companies.

2. Accounting Policies

The accounting policies and methods of computation adopted in the preparation of the Group condensed interim financial statements are consistent with those applied in the 2021 Annual Report and are described in those financial statements on pages 206 to 214.

The following changes to IFRS became effective for the Group during the period but did not result in material changes to the Group's consolidated financial statements:

· Interest Rate Benchmark Reform - Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16)

· Covid 19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16)

The Group has not applied certain new standards, amendments and interpretations to existing standards that have been issued but are not yet effective. They are either not expected to have a material effect on the consolidated financial statements or they are not currently relevant for the Group.

3. Going Concern

Having reassessed the principal risks facing the Group (as detailed on pages 85 to 89 of the 2021 Annual Report), the Directors believe that the Group is well placed to manage these risks successfully. No concerns or material uncertainties have been identified as part of our assessment.

The Directors have a reasonable expectation that DCC plc, and the Group as a whole, has adequate resources to continue in operational existence for the foreseeable future, a period of not less than twelve months from the date of this report. For this reason, the Directors continue to adopt the going concern basis of accounting in preparing the condensed interim financial statements.

4. Reporting Currency

The Group's financial statements are presented in sterling, denoted by the symbol '£'. Results and cash flows of operations based in non-sterling countries have been translated into sterling at average rates for the period, and the related balance sheets have been translated at the rates of exchange ruling at the balance sheet date. The principal exchange rates used for translation of results and balance sheets into sterling were as follows:

		Average rate				Closing rate
	6 months		6 months	Year	6 months		6 months	Year
	ended		ended	ended	ended		ended	ended
	30 Sept.		30 Sept.	31 March	30 Sept.		30 Sept.	31 March
	2021		2020	2021	2021		2020	2021
	Stg£1=		Stg£1=	Stg£1=	Stg£1=		Stg£1=	Stg£1=

Euro	1.1652		1.1183	1.1182	1.1621		1.0960	1.1736
Danish Krone	8.6661		8.3370	8.3295	8.6415		8.1611	8.7282
Swedish Krona	11.8445		11.7989	11.6205	11.8167		11.5863	12.0154
Norwegian Krone	11.8558		12.2289	12.0742	11.8129		12.1666	11.7304
US Dollar	1.3909		1.2665	1.3036	1.3456		1.2832	1.3760
Hong Kong Dollar	10.8076		9.8172	10.1056	10.4804		9.9454	10.6975

5. Segmental Reporting

DCC is an international sales, marketing and support services group headquartered in Dublin, Ireland. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as Mr. Donal Murphy, Chief Executive and his executive management team. The Group is organised into four operating segments (as identified under IFRS 8 Operating Segments) and generates revenue through the following activities:

DCC LPG is a leading liquefied ('LPG') sales and marketing business, supplying LPG in cylinder and bulk format to residential, commercial and industrial customers. In addition, DCC LPG is developing a broader customer offering through the supply of natural gas, power and renewables products, plus a range of specialty gases such as refrigerants and medical gases.

DCC Retail & Oil is a leading provider of transport and heating energy, lower emission fuels and biofuels, and related services to consumers and SME businesses across Europe and has a key focus on being a market leader in providing sustainable energy solutions to consumers.

DCC Healthcare is a leading healthcare business, providing products and services to health and beauty brand owners and healthcare providers.

DCC Technology is a leading route-to-market and supply chain partner for global technology brands and customers. DCC Technology provides a broad range of consumer, business and enterprise technology products and services to retailers, resellers and integrators.

The chief operating decision maker monitors the operating results of segments separately in order to allocate resources between segments and to assess performance. Segment performance is predominantly evaluated based on operating profit before amortisation of intangible assets and net operating exceptional items. Net finance costs and income tax are managed on a centralised basis and therefore these items are not allocated between operating segments for the purpose of presenting information to the chief operating decision maker and accordingly are not included in the detailed segmental analysis.

The consolidated total assets of the Group as at 30 September 2021 amounted to £8.1 billion. This figure was not materially different from the equivalent figure at 31 March 2021 and therefore the related segmental disclosure note has been omitted in accordance with IAS 34 Interim Financial Reporting. Intersegment revenue is not material and thus not subject to separate disclosure.

An analysis of the Group's performance by segment and geographic location is as follows:
(a) By operating segment
(a) By operating segment
	Unaudited six months ended 30 September 2021

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total

	£'000	£'000	£'000	£'000	£'000

Segment revenue	862,268	4,286,533	384,224	1,985,304	7,518,329

Adjusted operating profit	48,369	70,022	50,203	27,187	195,781
Amortisation of intangible assets	(21,798)	(4,255)	(1,804)	(8,709)	(36,566)
Net operating exceptionals (note 6)	(6,036)	(1,631)	(789)	(9,849)	(18,305)
Operating profit	20,535	64,136	47,610	8,629	140,910


	Unaudited six months ended 30 September 2020

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total

	£'000	£'000	£'000	£'000	£'000

Segment revenue	578,314	3,061,937	322,009	1,968,834	5,931,094

Adjusted operating profit	45,557	65,172	39,840	25,529	176,098
Amortisation of intangible assets	(16,689)	(1,681)	(3,150)	(9,014)	(30,534)
Net operating exceptionals (note 6)	(6,839)	(246)	(326)	(7,292)	(14,703)
Operating profit	22,029	63,245	36,364	9,223	130,861


	Audited year ended 31 March 2021

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total

	£'000	£'000	£'000	£'000	£'000

Segment revenue	1,685,570	6,588,186	655,364	4,483,330	13,412,450

Adjusted operating profit	231,253	144,824	81,721	72,445	530,243
Amortisation of intangible assets	(37,829)	(4,926)	(5,504)	(18,639)	(66,898)
Net operating exceptionals (note 6)	(17,732)	(5,261)	(4,229)	(13,273)	(40,495)
Operating profit	175,692	134,637	71,988	40,533	422,850

(b) By geography

The Group has a presence in 20 countries worldwide. The following represents a geographical revenue analysis about the country of domicile (Republic of Ireland) and countries with material revenue representing over 10% of Group revenue.


	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000

Republic of Ireland	588,902	370,466	901,802
United Kingdom	3,122,439	2,637,784	5,932,234
France	1,383,777	1,051,881	2,442,082
Other	2,423,211	1,870,963	4,136,332
	7,518,329	5,931,094	13,412,450

(c) Disaggregation of revenue The following table disaggregates revenue by primary geographical market, major revenue lines and timing of revenue recognition. The use of revenue as a metric of performance in the Group's LPG and Retail & Oil segments is of limited relevance due to the influence of changes in underlying oil product costs on absolute revenues. Whilst changes in underlying oil product costs will change percentage operating margins, this has little relevance in the downstream energy distribution market in which these two segments operate where profitability is driven by absolute contribution per tonne/litre of product sold, and not a percentage margin. Accordingly, management review geographic volume performance rather than geographic revenue performance for these two segments as country-specific GDP and weather patterns can influence volumes. The disaggregated revenue information presented below for DCC Healthcare and Technology, which can also be influenced by country-specific GDP movements, is consistent with how revenue is reported and reviewed internally.

	Unaudited six months ended 30 September 2021

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total


	£'000	£'000	£'000	£'000	£'000

Republic of Ireland (country of domicile)	73,411	289,173	60,088	166,230	588,902
United Kingdom	167,833	1,780,427	208,998	965,181	3,122,439
France	376,626	848,666	-	158,485	1,383,777
Other	244,398	1,368,267	115,138	695,408	2,423,211
	862,268	4,286,533	384,224	1,985,304	7,518,329

LPG and related products	862,268	-	-	-	862,268
Oil and related products	-	4,286,533	-	-	4,286,533
Nutrition and health & beauty products	-	-	179,759	-	179,759
Medical and pharmaceutical products	-	-	204,465	-	204,465
Technology products and services	-	-	-	1,985,304	1,985,304
	862,268	4,286,533	384,224	1,985,304	7,518,329

Products transferred at point in time	862,268	4,286,533	384,224	1,985,304	7,518,329


	Unaudited six months ended 30 September 2020

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total


	£'000	£'000	£'000	£'000	£'000

Republic of Ireland (country of domicile)	41,988	142,456	46,537	139,485	370,466
United Kingdom	120,744	1,194,942	192,747	1,129,351	2,637,784
France	273,222	643,211	-	135,448	1,051,881
Other	142,360	1,081,328	82,725	564,550	1,870,963
	578,314	3,061,937	322,009	1,968,834	5,931,094

LPG and related products	578,314	-	-	-	578,314
Oil and related products	-	3,061,937	-	-	3,061,937
Nutrition and health & beauty products	-	-	176,369	-	176,369
Medical and pharmaceutical products	-	-	145,640	-	145,640
Technology products and services	-	-	-	1,968,834	1,968,834
	578,314	3,061,937	322,009	1,968,834	5,931,094

Products transferred at point in time	578,314	3,061,937	322,009	1,968,834	5,931,094

Audited year ended 31 March 2021

DCC DCC DCC DCC

LPG Retail & Oil Healthcare Technology Total


	£'000	£'000	£'000	£'000	£'000

Republic of Ireland (country of domicile)	130,842	340,285	103,364	327,311	901,802
United Kingdom	330,907	2,699,344	373,413	2,528,570	5,932,234
France	767,199	1,348,429	-	326,454	2,442,082
Other	456,622	2,200,128	178,587	1,300,995	4,136,332
	1,685,570	6,588,186	655,364	4,483,330	13,412,450

LPG and related products	1,685,570	-	-	-	1,685,570
Oil and related products	-	6,588,186	-	-	6,588,186
Nutrition and health & beauty products	-	-	373,824	-	373,824
Medical and pharmaceutical products	-	-	281,540	-	281,540
Technology products and services	-	-	-	4,483,330	4,483,330
	1,685,570	6,588,186	655,364	4,483,330	13,412,450

Products transferred at point in time	1,685,570	6,588,186	655,364	4,483,330	13,412,450

6. Exceptionals

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000

Restructuring and integration costs	(5,344)	(12,657)	(26,724)
Acquisition and related costs	(5,782)	(1,921)	(13,604)
Adjustments to contingent acquisition consideration	(8,000)	27	27
Other operating exceptional items	821	(152)	(194)
Net operating exceptional items	(18,305)	(14,703)	(40,495)

Mark to market of swaps and related debt	967	1,406	1,384
Net exceptional items before taxation	(17,338)	(13,297)	(39,111)

Income tax (charge)/credit attaching to exceptional items	(184)	(226)	4,104
Net exceptional items attributable to owners of the Parent	(17,522)	(13,523)	(35,007)

Acquisition and related costs include the professional fees and tax costs (such as stamp duty) relating to the evaluation and/or completion of acquisition opportunities and amounted to £5.782 million.

Restructuring and integration costs of £5.344 million primarily 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.

Most of the Group's debt has been raised in the US private placement market, denominated in US dollars, euro and sterling. Long-term interest and cross currency interest rate derivatives have been utilised to achieve an appropriate mix of fixed and floating rate debt across the three currencies. The level of ineffectiveness calculated under IAS 39 on the fair value and cash flow hedge relationships relating to this 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 £0.967 million. Following this credit, the cumulative net exceptional credit taken in respect of the Group's outstanding US Private Placement debt and related hedging instruments is £0.300 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.

7. Taxation

The taxation expense for the interim period is based on management's best estimate of the weighted average tax rate that is expected to be applicable for the full year. The Group's effective tax rate for the period was 18% (six months ended 30 September 2020: 17% and year ended 31 March 2021: 17%).

8. Earnings per Ordinary Share

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000

Profit attributable to owners of the Parent	84,507	78,614	292,619
Amortisation of intangible assets after tax	30,328	23,994	53,234
Exceptionals after tax	17,522	13,523	35,007
Adjusted profit after taxation and non-controlling interests	132,357	116,131	380,860

Basic earnings per ordinary share

Basic earnings per share is calculated by dividing the profit attributable to owners of the Parent Company by the weighted average number of ordinary shares in issue during the period, excluding ordinary shares purchased by the Company and held as treasury shares. The adjusted figures for basic earnings per ordinary share (a non-GAAP financial measure) are intended to demonstrate the results of the Group after eliminating the impact of amortisation of intangible assets and net exceptionals.

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	pence	pence	pence

Basic earnings per ordinary share	85.71p	79.83p	297.04p
Amortisation of intangible assets after tax	30.76p	24.37p	54.04p
Exceptionals after tax	17.77p	13.73p	35.54p
Adjusted basic earnings per ordinary share	134.24p	117.93p	386.62p
Weighted average number of ordinary shares in issue (thousands)	98,596	98,472	98,510

Diluted earnings per ordinary share

Diluted earnings per ordinary share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. Share options and awards are the Company's only category of dilutive potential ordinary shares. The adjusted figures for diluted earnings per ordinary share (a non-GAAP financial measure) are intended to demonstrate the results of the Group after eliminating the impact of amortisation of intangible assets and net exceptionals.

Employee share options and awards, which are performance-based, are treated as contingently issuable shares because their issue is contingent upon satisfaction of specified performance conditions in addition to the passage of time. These contingently issuable shares are excluded from the computation of diluted earnings per ordinary share where the conditions governing exercisability would not have been satisfied as at the end of the reporting period if that were the end of the vesting period.

The adjusted figures for diluted earnings per ordinary share (a non-GAAP financial measure) are intended to demonstrate the results of the Group after eliminating the impact of amortisation of intangible assets and net exceptionals.

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	pence	pence	pence

Diluted earnings per ordinary share	85.66p	79.70p	296.62p
Amortisation of intangible assets after tax	30.74p	24.33p	53.96p
Exceptionals after tax	17.76p	13.71p	35.49p
Adjusted diluted earnings per ordinary share	134.16p	117.74p	386.07p
Weighted average number of ordinary shares in issue (dilutive, thousands)	98,654	98,634	98,650

The earnings used for the purposes of the diluted earnings per ordinary share calculations were £84.507 million (six months ended 30 September 2020: £78.614 million) and £132.357 million (six months ended 30 September 2020: £116.131 million) for the purposes of the adjusted diluted earnings per ordinary share calculations. The weighted average number of ordinary shares used in calculating the diluted earnings per ordinary share for the six months ended 30 September 2021 was 98.654 million (six months ended 30 September 2020: 98.634 million). A reconciliation of the weighted average number of ordinary shares used for the purposes of calculating the diluted earnings per ordinary share amounts is as follows:

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	'000	'000	'000

Weighted average number of ordinary shares in issue	98,596	98,472	98,510
Dilutive effect of options and awards	58	162	140
Weighted average number of ordinary shares for diluted earnings per share	98,654	98,634	98,650

9. Dividends

	Unaudited		Unaudited	Audited
	6 months		6 months	year
	ended		ended	ended
	30 Sept.		30 Sept.	31 March
	2021		2020	2021
	£'000		£'000	£'000

Interim - paid 51.95 pence per share on 9 December 2020		-	-	51,045
Final - paid 107.85 pence per share on 22 July 2021 (paid 95.79 pence per share on 23 July 2020)	106,304		92,470	92,478
	106,304		92,470	143,523

On 8 November 2021, the Board approved an interim dividend of 55.85 pence per share (£55.074 million). These condensed interim financial statements do not reflect this dividend payable.

10. Other Reserves



For the six months ended 30 September 2021				Foreign
	Share based		Cash flow	currency
		payment	hedge	translation	Other
		reserve	reserve	reserve	reserves	Total
		£'000	£'000	£'000	£'000	£'000

At 1 April 2021		40,969	13,130	60,260	932	115,291

Currency translation		-	-	16,853	-	16,853
Movements relating to cash flow hedges		-	105,035	-	-	105,035
Movement in deferred tax liability on cash flow hedges -			(19,065)	-	-	(19,065)
Share based payment		3,562	-	-	-	3,562
At 30 September 2021		44,531	99,100	77,113	932	221,676

For the six months ended 30 September 2020				Foreign
	Share based		Cash flow	currency
		payment	hedge	translation	Other
		reserve	reserve	reserve	reserves	Total
		£'000	£'000	£'000	£'000	£'000

At 1 April 2020		34,914	(43,277)	111,527	932	104,096

Currency translation		-	-	17,651	-	17,651
Movements relating to cash flow hedges		-	54,668	-	-	54,668
Movement in deferred tax liability on cash flow hedges -			(9,294)	-	-	(9,294)
Share based payment		3,711	-	-	-	3,711
At 30 September 2020		38,625	2,097	129,178	932	170,832


For the year ended 31 March 2021				Foreign
	Share based		Cash flow	currency
		payment	hedge	translation	Other
		reserve	reserve	reserve	reserves	Total
		£'000	£'000	£'000	£'000	£'000

At 1 April 2020		34,914	(43,277)	111,527	932	104,096

Currency translation		-	-	(51,267)	-	(51,267)
Movements relating to cash flow hedges		-	67,961	-	-	67,961
Movement in deferred tax liability on cash flow hedges -			(11,554)	-	-	(11,554)
Share based payment		6,055	-	-	-	6,055
At 31 March 2021		40,969	13,130	60,260	932	115,291

11. Analysis of Net Debt

	Unaudited	Unaudited	Audited
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Non-current assets:
Derivative financial instruments	126,079	178,094	121,671

Current assets:
Derivative financial instruments	150,744	33,389	40,181
Cash and cash equivalents	1,437,725	1,574,329	1,786,556
	1,588,469	1,607,718	1,826,737
Non-current liabilities:
Derivative financial instruments	-	(687)	(652)
Unsecured Notes	(1,568,450)	(1,716,427)	(1,553,200)
	(1,568,450)	(1,717,114)	(1,553,852)
Current liabilities:
Derivative financial instruments	(53,140)	(11,896)	(9,843)
Bank borrowings	(102,456)	(80,036)	(69,660)
Unsecured Notes	(44,652)	(113,963)	(149,999)
	(200,248)	(205,895)	(229,502)
Net (debt)/cash (excluding lease creditors)	(54,150)	(137,197)	165,054

Lease creditors - non-current	(275,859)	(256,747)	(261,617)
Lease creditors - current	(60,322)	(47,009)	(53,607)
Total lease creditors	(336,181)	(303,756)	(315,224)
Net debt (including lease creditors)	(390,331)	(440,953)	(150,170)

An analysis of the maturity profile of the Group's net debt (including lease creditors) at 30 September 2021 is as follows:



		Between	Between
	Less than	1 and 2	2 and 5	Over
	1 year	years	years	5 years	Total
At 30 September 2021	£'000	£'000	£'000	£'000	£'000

Cash and short-term deposits	1,437,725	-	-	-	1,437,725
Overdrafts	(102,456)	-	-	-	(102,456)
Cash and cash equivalents	1,335,269	-	-	-	1,335,269
Unsecured Notes	(44,652)	(255,330)	(626,845)	(686,275)	(1,613,102)
Derivative financial instruments - Unsecured Notes	6,995	34,803	77,200	14,076	133,074
Derivative financial instruments - other	90,609	-	-	-	90,609
Net debt (excluding lease creditors) 1,388,221		(220,527)	(549,645)	(672,199)	(54,150)

Lease creditors	(60,322)	(51,354)	(103,073)	(121,432)	(336,181)
Net debt (including lease creditors)	1,327,899	(271,881)	(652,718)	(793,631)	(390,331)

The Group's Unsecured Notes fall due between 24 March 2022 and 4 April 2034 with an average maturity of 5.0 years at 30 September 2021. The full fair value of a hedging derivative is allocated to the time period corresponding to the maturity of the hedged item.

12. Business Combinations

A key strategy of the Group is to create and sustain market leadership positions through acquisitions in markets it currently operates in, together with extending the Group's footprint into new geographic markets. In line with this strategy, the principal acquisitions completed by the Group during the period, together with percentages acquired, were as follows:

· The acquisition by DCC Healthcare in June 2021 of Wörner Medizinprodukte Holding GmbH ("Wörner"), a leading supplier of medical and laboratory products to the primary care sector in Germany and Switzerland. Wörner sells a broad product range to approximately 20,000 customers annually, including general practitioners, primary care centres, specialist medical centres and laboratories;

· The acquisition by DCC LPG of 100% of Primagaz from SHV Energy in July 2021. The business focuses on the bulk and cylinder LPG markets, and serves approximately 10,000 customers annually; and

· The acquisition by DCC Retail & Oil in September 2021 of a network of 19 retail forecourt sites in Luxembourg. Most of the sites are Gulf branded with established convenience retail operations under the Cactus Shoppi brand which DCC will operate.

The acquisition data presented below reflects the fair value of the identifiable net assets acquired (excluding cash and cash equivalents acquired) in respect of acquisitions completed during the six months ended 30 September 2021.


	6 months	6 months
	ended	ended
	30 Sept.	30 Sept.
	2021	2020
	£'000	£'000
Assets
Non-current assets
Property, plant and equipment	29,840	6,867
Right-of-use leased assets	21,793	-
Deferred income tax assets	376	7
Total non-current assets	52,009	6,874

Current assets
Inventories	23,262	100
Trade and other receivables	26,999	617
Total current assets	50,261	717

Liabilities
Non-current liabilities
Lease creditors	(18,617)	-
Provisions for liabilities and charges	(7,879)	-
Total non-current liabilities	(26,496)	-

Current liabilities
Trade and other payables	(54,630)	(251)
Current income tax liability	(1,337)	(195)
Lease creditors	(3,176)	-
Total current liabilities	(59,143)	(446)

Identifiable net assets acquired	16,631	7,145
Non-controlling interest arising on acquisition	(2,058)	-
Intangible assets - goodwill	152,471	67,330
Total consideration	167,044	74,475

Satisfied by:
Cash	152,865	82,341
Cash and cash equivalents acquired	(11,584)	(9,656)
Net cash outflow	141,281	72,685
Acquisition related liabilities	25,763	1,790
Total consideration	167,044	74,475

None of the business combinations completed during the period were considered sufficiently material to warrant separate disclosure of the fair values attributable to those combinations.

There were no adjustments made to the carrying amounts of assets and liabilities acquired in arriving at their fair values. The initial assignment of fair values to identifiable net assets acquired has been performed on a provisional basis in respect of a number of the business combinations above given the timing of closure of these transactions. Any amendments to these fair values within the twelve-month timeframe from the date of acquisition will be disclosable in the Group's condensed interim financial statements for the six months ending 30 September 2022 as stipulated by IFRS 3.

The principal factors contributing to the recognition of goodwill on business combinations entered into by the Group are the expected profitability of the acquired business and the realisation of cost savings and synergies with existing Group entities.

Acquisition and related costs included in other operating expenses in the Group Income Statement amounted to £5.782 million (six months ended 30 September 2020: £1.921 million).

No contingent liabilities were recognised on the acquisitions completed during the financial period or the prior financial years.

The gross contractual value of trade and other receivables as at the respective dates of acquisition amounted to £27.431 million. The fair value of these receivables is £26.999 million (all of which is expected to be recoverable).

None of the goodwill recognised in respect of acquisitions completed during the period is expected to be deductible for tax purposes.

The fair value of contingent consideration recognised at the date of acquisition is calculated by discounting the expected future payment to present value at the acquisition date. In general, for contingent consideration to become payable, pre-defined profit thresholds must be exceeded. On an undiscounted basis, the future payments for which the Group may be liable for acquisitions completed during the period range from nil to £40.7 million.

The acquisitions during the period contributed £123.5 million to revenues and £5.6 million to profit after tax. The revenue and profit of the Group determined in accordance with IFRS for the period ended 30 September 2021 would not have been materially different than reported in the Income Statement if the acquisition date for all business combinations completed during the period had been as of the beginning of the period.

13. Post Employment Benefit Obligations

The Group's defined benefit pension schemes' assets were measured at fair value at 30 September 2021. The defined benefit pension schemes' liabilities at 30 September 2021 were updated to reflect material movements in underlying assumptions.

The Group's post employment benefit obligations moved from a net asset of £8.024 million at 31 March 2021 to a net asset of £5.517 million at 30 September 2021. This movement was primarily driven by an actuarial loss on liabilities arising from a decrease in the discount rates used to value these liabilities.

The following actuarial assumptions have been made in determining the Group's retirement benefit obligation for the six months ended 30 September 2021:

	Unaudited	Unaudited	Audited
	6 months	6 months	year
	ended	ended	ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
Discount rate
- Republic of Ireland	1.30%	1.25%	1.50%
- United Kingdom	2.00%	1.75%	2.20%
- Germany	1.30%	1.25%	1.50%

14. Seasonality of Operations

The Group's operations are significantly second-half weighted primarily due to a portion of the demand for DCC's LPG and Retail & Oil products being weather dependent and seasonal buying patterns in DCC Technology.

15. Related Party Transactions

There have been no related party transactions or changes in the nature and scale of the related party transactions described in the 2021 Annual Report that could have had a material impact on the financial position or performance of the Group in the six months ended 30 September 2021.

16. Events after the Balance Sheet Date

There have been no material events subsequent to 30 September 2021 which would require disclosure in this Report.

17. Board Approval

This report was approved by the Board of Directors of DCC plc on 8 November 2021.

18. Distribution of Interim Report

This report and further information on DCC is available at the Company's website www.dcc.ie. A printed copy is available to the public at the Company's registered office at DCC House, Leopardstown Road, Foxrock, Dublin 18, Ireland.

Statement of Directors' Responsibilities

We confirm that to the best of our knowledge:

·the condensed set of interim financial statements for the six months ended 30 September 2021 have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU; and

·the interim management report includes a fair review of the information required by:

‒ Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

‒ Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

On behalf of the Board

Mark Breuer Donal Murphy

Chairman Chief Executive

8 November 2021

Supplementary Financial Information

Alternative Performance Measures

The Group reports certain alternative performance measures ('APMs') that are not required under International Financial Reporting Standards ('IFRS') which represent the generally accepted accounting principles ('GAAP') under which the Group reports. The Group believes that the presentation of these APMs provides useful supplemental information which, when viewed in conjunction with our IFRS financial information, provides investors with a more meaningful understanding of the underlying financial and operating performance of the Group and its divisions.

These APMs are primarily used for the following purposes:

• to evaluate the historical and planned underlying results of our operations;

• to set director and management remuneration; and

• to discuss and explain the Group's performance with the investment analyst community.

None of the APMs should be considered as an alternative to financial measures derived in accordance with GAAP. The APMs can have limitations as analytical tools and should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP. These performance measures may not be calculated uniformly by all companies and therefore may not be directly comparable with similarly titled measures and disclosures of other companies.

The principal APMs used by the Group, together with reconciliations where the non-GAAP measures are not readily identifiable from the financial statements, are as follows:

Adjusted operating profit ('EBITA')

Definition

This comprises operating profit as reported in the Group Income Statement before net operating exceptional items and amortisation of intangible assets. Net operating exceptional items and amortisation of intangible assets are excluded in order to assess the underlying performance of our operations. In addition, neither metric forms part of Director or management remuneration targets.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Operating profit	140,910	130,861	422,850
Net operating exceptional items	18,305	14,703	40,495
Amortisation of intangible assets	36,566	30,534	66,898
Adjusted operating profit ('EBITA')	195,781	176,098	530,243

Net interest

Definition

The Group defines net interest as the net total of finance costs and finance income before interest related exceptional items as presented in the Group Income Statement.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Finance costs before exceptional items	(39,355)	(45,070)	(85,639)
Finance income before exceptional items	12,056	14,819	26,253
Net interest	(27,299)	(30,251)	(59,386)

Constant currency

Definition

The translation of foreign denominated earnings can be impacted by movements in foreign exchange rates versus sterling, the Group's presentation currency. In order to present a better reflection of underlying performance in the period, the Group retranslates foreign denominated current year earnings at prior year exchange rates.


	6 months ended	6 months ended
	30 Sept.	30 Sept.
	2021	2020
Calculation: Revenue - constant currency	£'000	£'000
Revenue	7,518,329	5,931,094
Currency impact	172,846	-
Revenue - constant currency	7,691,175	5,931,094

	6 months ended	6 months ended
	30 Sept.	30 Sept.
	2021	2020
Calculation: Adjusted operating profit - constant currency	£'000	£'000
Adjusted operating profit	195,781	176,098
Currency impact	7,618	-
Adjusted operating profit - constant currency	203,399	176,098

Effective tax rate

Definition

The Group's effective tax rate expresses the income tax expense before exceptionals and deferred tax attaching to the amortisation of intangible assets as a percentage of EBITA less net interest.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Adjusted operating profit	195,781	176,098	530,243
Net interest	(27,299)	(30,251)	(59,386)
Earnings before taxation	168,482	145,847	470,857
Income tax expense	24,273	18,480	62,278
Income tax attaching to net exceptionals	(184)	(226)	4,104
Deferred tax attaching to amortisation of intangible assets	6,238	6,540	13,664
Total income tax expense before exceptionals and deferred tax attaching to amortisation of intangible assets	30,327	24,794	80,046
Effective tax rate (%)	18.0%	17.0%	17.0%

Net capital expenditure

Definition

Net capital expenditure comprises purchases of property, plant and equipment, proceeds from the disposal of property, plant and equipment and government grants received in relation to property, plant and equipment.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Purchase of property, plant and equipment	78,187	88,615	162,879
Government grants received in relation to property, plant and equipment	-	-	(89)
Proceeds from disposal of property, plant and equipment	(11,148)	(1,056)	(15,898)
Net capital expenditure	67,039	87,559	146,892

Free cash flow

Definition

Free cash flow is defined by the Group as cash generated from operations before exceptional items as reported in the Group Cash Flow Statement after repayment of lease creditors and net capital expenditure.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Cash generated from operations before exceptionals	115,276	241,389	903,659
Repayment of lease creditors	(35,911)	(33,137)	(68,986)
Net capital expenditure	(67,039)	(87,559)	(146,892)
Free cash flow	12,326	120,693	687,781

Free cash flow (after interest and tax payments)

Definition

Free cash flow (after interest and tax payments) is defined by the Group as free cash flow after interest paid (excluding interest relating to lease creditors), income tax paid, dividends received from equity accounted investments and interest received.

	6 months ended	6 months ended	Year ended
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Free cash flow	12,326	120,693	687,781
Interest paid (excluding interest relating to lease creditors)	(30,543)	(40,154)	(74,635)
Income tax paid	(34,894)	(16,967)	(62,191)
Interest received	12,033	15,155	27,930
Free cash flow (after interest and tax payments)	(41,078)	78,727	578,885

Committed acquisition expenditure

Definition

The Group defines committed acquisition expenditure as the total acquisition cost of subsidiaries as presented in the Group Cash Flow Statement (excluding amounts related to acquisitions which were committed to in previous years) and future acquisition related liabilities for acquisitions committed to during the period.

	6 months ended		6 months ended	Year ended
	30 Sept.		30 Sept.	31 March
	2021		2020	2021
	£'000		£'000	£'000
Net cash outflow on acquisitions during the period	141,281		72,685	236,232
Net cash outflow on acquisitions which were committed to in the previous period		(112,478)	(22,560)	(22,388)
Acquisition related liabilities arising on acquisitions during the period	25,763		1,790	9,321
Acquisition related liabilities which were committed to in the previous period	(18,912)		(417)	(539)
Amounts committed in the current period	42,081		35,500	152,000
Committed acquisition expenditure	77,735		86,998	374,626

Net working capital

Definition

Net working capital represents the net total of inventories, trade and other receivables (excluding interest receivable), and trade and other payables (excluding interest payable, amounts due in respect of property, plant and equipment and current government grants).

	As at	As at	As at
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Inventories	941,545	756,464	685,950
Trade and other receivables	1,557,229	1,434,777	1,689,372
Less: interest receivable	(39)	(98)	(16)
Trade and other payables	(2,548,083)	(2,202,991)	(2,604,177)
Less: interest payable	14,625	10,763	11,668
Less: amounts due in respect of property, plant and equipment	9,510	2,111	13,554
Less: government grants	17	11	20
Net working capital	(25,196)	1,037	(203,629)

Working capital (days)

Definition

Working capital days measures how long it takes in days for the Group to convert working capital into revenue.

	As at	As at	As at
	30 Sept.	30 Sept.	31 March
	2021	2020	2021
	£'000	£'000	£'000
Net working capital	(25,196)	1,037	(203,629)
September/March revenue	1,485,343	1,287,071	1,468,052
Working capital (days)	(0.5 days)	0.0 days	(4.3 days)

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IR GZMGMLRLGMZM

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Results for the six months ended 30 September 2021

9 November 2021

Dividend

Cash Flow, Development & Financial Position

Cash flow

2021

2020

£'m

£'m

195.8

176.1

Increase in working capital

(183.2)

(28.4)

Depreciation (excluding ROU leased assets) and other

70.2

63.8

Operating cash flow (pre add-back for depreciation on ROU leased assets)

82.8

211.5

Capital expenditure (net)

(67.0)

(87.6)

15.8

123.9

Depreciation on ROU leased assets

32.4

29.9

Repayment of lease creditors

(35.9)

(33.1)

Free cash flow

12.3

120.7

Interest and tax paid, net of dividend from equity accounted investments

(53.4)

(42.0)

Free cash flow (after interest and tax)

(41.1)

78.7

Acquisitions

(162.4)

(98.5)

Dividends

(106.8)

(92.5)

Exceptional items

(9.8)

(19.2)

Share issues

0.4

-

Net outflow

(319.7)

(131.5)

Opening net debt

(150.2)

(367.1)

Translation and other

79.6

57.6

Closing net debt (including lease creditors)

(390.3)

(441.0)

Analysis of closing net debt (including lease creditors):

Net debt at 30 September (excluding lease creditors)

(54.1)

(137.2)

Lease creditors at 30 September

(336.2)

(303.8)

(390.3)

(441.0)

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