(Alliance News) - DCC PLC on Tuesday said it agreed its largest ever German acquisition with Progas GmbH, and said revenue and profit both fell in the latest half year but declared an increased dividend.

The Dublin-based sales, marketing and support services firm said pretax profit for the six months that ended on September 30 was GBP129.7 million, down from GBP312.3 million the previous year.

Revenue fell 11% to GBP9.62 billion from GBP10.84 billion. This was mainly due to lower average commodity prices, which caused DCC Energy revenue to decrease 9.7% to GBP2.3 billion.

DCC nonetheless declared an interim dividend of 63.04 pence per share, up 5.0% from 60.04 pence the year before.

Group adjusted operating profit jumped 12% to GBP247.6 million from GBP221.2 million, with a mixed divisional performance. For DCC Healthcare and DCC Technology, adjusted operating profit dropped 11% and 15% respectively, to GBP38.3 million and GBP38.7 million. DCC Energy profit, however, surged by 29% to GBP170.6 million.

Cost of sales decreased 14% to GBP8.43 billion from GBP9.76 billion, while administration expenses increased 6.8% to GBP364.4 million and selling & distribution costs increased 11% to GBP583.1 million.

Net debt closed at GBP1.39 billion on September 30, up from GBP1.12 billion at the same time in 2022.

"We delivered strong profit growth in the first half of our financial year," commented Chief Executive Donal Murphy. "Although the macro environment remains volatile, DCC continued to perform thanks to our resilient and diverse business.

"During the period we committed to seven acquisitions aligned to our strategic priorities to give all our customers the power to choose a cleaner energy future."

Also on Tuesday DCC announced another acquisition, agreeing to purchase liquefied petroleum gas or LPG distributor Progas GmbH in its "largest acquisition to date in Germany". It said the purchase is based on an enterprise value of approximately EUR160 million or GBP140 million on a cash and debt-free basis, with consideration to be settled in cash on completion.

DCC expects to complete the acquisition by the end of the current financial year, and to generate a mid-teen return on capital employed within the subsequent 12 months.

CEO Murphy said the deal "will enable DCC to accelerate the growth of our Energy Solutions business in Germany focusing on LPG, renewable LPG, solar, and additional energy management services, where DCC can become the trusted cleaner energy partner to every customer."

DCC shares were up 6.8% at 4,982.00 pence each in London on Tuesday morning.

By Emma Curzon, Alliance News reporter

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