BUSINESS MODEL AND STRATEGY

OUR BUSINESS MODEL


DCC IS A SALES, MARKETING, DISTRIBUTION AND BUSINESS SUPPORT SERVICES GROUP. THE GROUP IS ORGANISED AND MANAGED IN FIVE SEPARATE DIVISIONS, EACH FOCUSED ON SPECIFIC MARKET SECTORS.

DIVISION MARKET SECTOR

DCC ENERGY

  • Oil and LPG sales, marketing and distribution
   

DCC SERCOM

  • IT, communications and home entertainment products sales, marketing and distribution
  • Supply chain management services
   

DCC HEALTHCARE

  • Medical device and pharma products sales, marketing and distribution and value added logistics services to hospitals
  • Outsourced services to brand owners in the health & beauty sector
   

DCC ENVIRONMENTAL

  • Waste management and recycling services to commercial, industrial and public sector customers
   

DCC FOOD & BEVERAGE

  • Food & beverage product sales, marketing and distribution
OUR OBJECTIVE
OUR STRATEGY
TO BUILD A GROWING, SUSTAINABLE AND CASH GENERATIVE BUSINESS WHICH CONSISTENTLY PROVIDES RETURNS ON TOTAL CAPITAL EMPLOYED SIGNIFICANTLY AHEAD OF ITS COST OF CAPITAL.
CREATING AND SUSTAINING LEADING POSITIONS IN EACH OF THE MARKETS IN WHICH WE OPERATE
DCC aims to be the number 1 or 2 operator in each of its markets. This is achieved through a consistent focus on increasing market shares organically and via value enhancing acquisitions. DCC has a long and successful track record of bolt-on acquisitions which have strengthened our market positions and generated attractive returns on capital invested.

CONTINUOUSLY BENCHMARKING AND IMPROVING THE EFFICIENCY OF OUR OPERATING MODEL IN EACH OF OUR BUSINESSES
DCC strives to be the most efficient business in each of the sectors in which it operates. We continuously benchmark our businesses against those specific KPIs which we judge are important indicators in our drive for superior returns on capital in the short, medium and longer term.

CAREFULLY EXTENDING OUR GEOGRAPHIC FOOTPRINT, THEREBY PROVIDING NEW HORIZONS FOR GROWTH
In the year ended 31 March 2012, 68% of DCC's operating profits were derived from the UK and 14% from Ireland. In recent years we have been expanding certain of the Group's businesses into other European markets which we believe will provide good opportunity for growth going forward. In the year ended 31 March 2012, 17% of operating profits were from Continental Europe, up from 12% last year and 3% five years ago. We will look to further extend our business in these markets and to enter new geographic markets in the coming years.

MAINTAINING FINANCIAL STRENGTH THROUGH A DISCIPLINED APPROACH TO BALANCE SHEET MANAGEMENT
It is core to our strategy that in pursuing our objectives, we will only do so in the context of maintaining relatively low levels of financial risk in the Group. We believe that this not only provides the greatest likelihood of generating value for shareholders in the long term but also leaves the Group best placed to react quickly to commercial opportunities as they arise.

ATTRACTING AND EMPOWERING ENTREPRENEURIAL LEADERSHIP TEAMS, CAPABLE OF DELIVERING OUTSTANDING PERFORMANCE, THROUGH THE DEPLOYMENT OF A DEVOLVED MANAGEMENT STRUCTURE
DCC strives to attract, motivate and empower entrepreneurial leadership teams across the Group. Given the diverse market sectors which we operate in, we believe that providing appropriate short and long term incentives to these leaders, based on the performance of the businesses which they manage, is the best way to drive returns for shareholders. Very often postacquisition, we retain entrepreneurial managers who have sold their businesses to DCC and through our devolved management structure we ensure they are empowered to continue to develop those businesses. We then overlay this with both the close involvement of our small divisional teams with the businesses and strong Group financial and capital allocation controls.