Shares in sales and distribution group DCC (DCC) rallied 3% to £60.80, leaving behind their recent three-month lows, after the firm reported ‘very strong growth’ in the quarter to June.
While the company didn’t raise its guidance, the news that operating profit growth was ‘well ahead of the prior year and modestly ahead of expectations’ was enough to shake the stock out of its slumber of the last few weeks.
HEALTHCARE AND TECH LEAD
The healthcare business, which accounts for around 15% of operating profits, grew ‘very strongly’ thanks to demand in the US and Europe, a resumption of elective procedures in hospitals and the recent acquisition of Worner which boosted sales in Germany and Switzerland.
The technology business, which accounts for a similar percentage of profits, saw strong growth in professional audio products in the US as demand for tech goods recovered.
The Flogas LPG business, which makes up almost half of operating profits, saw a recovery in volumes from commercial and industrial customers compared with a weak first quarter last year, while the retail and oil business, which makes up around a quarter of profits, saw volume growth from transport customers as economies reopened.
GREEN MACHINE
Earlier in the week DCC published its latest sustainability report, with details of its own ESG credentials and how it helps its customers become greener.
In its energy business it has converted large industrial sites for firms including Diageo (DGE) and Smurfit Kappa (SKG) from oil to LPG, resulting in an overnight reduction of 20% in carbon emissions. It also reduced its own emissions by installing wind turbines at its Welsh manufacturing plant.
All the electricity sold by DCC in Ireland last year came from renewable sources, while the firm increased the number of fast electric chargers for electric vehicles on its retail sites by half and entered the French solar energy market with two acquisitions.
