Business Irish

Monday 21 October 2019

DCC acquires US and UK companies as it reiterates profit guidance

DCC's chief executive, Donal Murphy
DCC's chief executive, Donal Murphy
Ellie Donnelly

Ellie Donnelly

Dublin-listed DCC Technology has acquired two companies in the US and UK.

The combined initial enterprise value of the two companies, Stampede and Kondor, is around £110m (€124m) and DCC expects the acquisitions to generate a return on capital employed of approximately 15pc in the first full year of ownership.

In the US, DCC, a diversified sales, marketing and logistics group, has acquired Stampede, a specialist distributor of professional audio-visual products and solutions.

Stampede recorded revenue of $280m last year and employs approximately 210 people.

This is DCC’s first acquisition in North America and is consistent with its strategy of extending its geographical footprint and product range, the group said in an interim management statement ahead of its AGM today.

Meanwhile in the UK, the group has acquired Kondor, a mobile and accessory products distribution company. Kondor also provides outsourced category management solutions to the retail channel in the UK and Continental Europe.

Last year Kondor recorded revenue of £110m and the group currently employs around 250 people.

DCC said that the Kondor acquisition would strengthen its position as an omnichannel distribution and supply chain businesses in Europe.

Meanwhile, the group said that its operating profit for the first quarter ended 30 June 2018 was "in line with expectations" and, as expected, "well ahead" of the prior year.

The strong performance was driven by acquisitions completed in the prior year, the group said.

Looking forwards, the group reiterated its belief that the year ending 31 March 2019 will be another year of profit growth and development.

DCC's operating profit in the 12 months to the end of March 2018 rose 11.1pc to £383.4m (€435.8m. Its revenue, excluding fuel, was 12.6pc higher at £3.59bn (€4.08bn). About half the revenue growth came from organic growth.

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