TIDMDCC
RNS Number : 5165H
DCC PLC
25 March 2020
25 March 2020
DCC Healthcare announces the acquisition of Amerilab
Technologies
DCC plc, the leading international sales, marketing and support
services group, announces that DCC Health & Beauty Solutions
has acquired Amerilab Technologies, Inc ('Amerilab'), a specialist
provider of contract manufacturing and related services in
effervescent nutritional products, based near Minneapolis, in
Plymouth, Minnesota. The acquisition of Amerilab is DCC Health
& Beauty Solutions' third acquisition in the US market,
following the acquisition of Ion Labs in November 2019 and Elite
One Source in February 2018. It is a further significant step in
the execution of the strategy to build a business of scale in the
world's largest health supplements and nutritional products market
.
Amerilab specialises in the manufacture of effervescent
nutritional products in powder and tablet formats, which are packed
in stickpacks, sachets and tubes. Its service offering includes
product development, formulation, manufacturing, packaging and
regulatory services. Amerilab operates from a large, well-invested
facility, which complies with FDA cGMP (current Good Manufacturing
Practices) and is certified by leading international regulatory
bodies, NSF and the TGA (Australia's Therapeutic Goods
Association). In recent years Amerilab has invested in high-speed,
automated equipment, enhancing its operational efficiency and
increasing manufacturing capacity. Amerilab's customer base
consists of high-quality consumer healthcare companies, specialty
brand owners and direct sales organisations. Effervescents are a
higher growth product segment within the US nutritional market,
with attractive demographic characteristics and environmental
credentials. Amerilab's complementary effervescent capability will
create opportunities for cross-selling and other synergies with DCC
Health & Beauty Solutions.
The business, which employs 125 people and has revenues of
approximately $68 million, will continue to be led by its
experienced management team. DCC is acquiring Amerilab based on an
enterprise value of approximately $85 million (GBP72 million) and
the business is expected to generate returns consistent with the
existing Health & Beauty business within two years. The
majority of the consideration was paid in cash on completion from
DCC's extensive resources, with the balance representing contingent
and earn-out related consideration.
An integral part of DCC's strategy since foundation has been the
maintenance of a strong and liquid balance sheet. DCC will shortly
close the financial year ending 31 March 2020 with a very modest
level of net debt, substantial cash resources in excess of GBP1.5
billion, a long-term debt profile with an average term of
approximately six years and committed debt facilities of GBP400
million. This significant financial strength, alongside DCC's
diversified, robust business model, leaves DCC very well placed to
continue its growth and development into the future.
Donal Murphy, Chief Executive of DCC plc, said today:
"DCC Health & Beauty Solutions provides high-quality
services to leading health and beauty brand owners and direct sales
organisations. The acquisition of Amerilab significantly enhances
our existing presence in the US market. Amerilab will work closely
with Ion, Elite One Source and the businesses in Europe to
cross-sell the full breadth of DCC Health & Beauty Solutions'
comprehensive service offering.
The US is the world's largest health supplements and nutritional
products market. It is also an innovative, high-growth market, with
a fragmented contract manufacturing base. We continue to be excited
by the significant opportunities for organic and acquisitive growth
in this market. We believe this market will benefit from current
events as consumers are likely to be increasingly conscious of
their health and wellbeing.
In just two years, DCC has built a substantial presence in North
America, across three of our four divisions, representing
approximately 18% of the Group's capital employed and employing
1,800 people. Notwithstanding this significant growth in the
region, our market shares remain low and DCC has created ideal
platforms for further growth and development in these growing,
fragmented, markets."
For reference:
Donal Murphy, Chief Executive
Fergal O'Dwyer, Chief Financial Officer
Conor Costigan, Managing Director, DCC Healthcare
Telephone: +353 1 2799400
Email: investorrelations@dcc.ie
Web: www.dcc.ie
Powerscourt (Media)
Lisa Kavanagh / Victoria Palmer-Moore
Telephone: +44 20 7250 1446
Email: DCC@powerscourt-group.com
About DCC plc
DCC is a leading international sales, marketing and support
services group with a clear focus on performance and growth. It
operates through four divisions: LPG, Retail & Oil, Technology
and Healthcare.
DCC is an ambitious and entrepreneurial business operating in 20
countries, supplying products and services used by millions of
people every day. Building strong routes to market, driving for
results, focusing on cash conversion and generating superior
sustainable returns on capital employed enable the Group to
reinvest in its business, creating value for its stakeholders.
Headquartered in Dublin, employing approximately 13,000 people,
DCC's four divisions are:
-- DCC LPG - a leading LPG sales and marketing business with
operations in Europe, the US and Asia and a developing business in
the retailing of natural gas and electricity;
-- DCC Retail & Oil - a leader in the sales, marketing and
retailing of transport fuels and commercial fuels, heating oils and
related products and services in Europe;
-- DCC Technology - a leading route-to-market and supply chain
partner for global technology brands and customers; and
-- DCC Healthcare - a leading healthcare business, providing
products and services to healthcare providers and health and beauty
brand owners.
DCC plc is listed on the London Stock Exchange and is a
constituent of the FTSE 100. In its financial year ended 31 March
2019, DCC generated revenue of GBP15.2 billion and operating profit
of GBP460 million.
DCC has an excellent record, delivering compound annual growth
of 14% in operating profit and generating an average return on
capital employed of approximately 19% over 25 years as a public
company.
About DCC Healthcare
DCC Healthcare is a leading healthcare business, providing
products and services to healthcare providers and health and beauty
brand owners. DCC Healthcare operates through two businesses, DCC
Vital and DCC Health & Beauty Solutions. DCC Vital is involved
in s ales, marketing and distribution of medical products to
healthcare providers in the UK, Ireland and international markets;
and agency distribution and related services in Ireland . DCC
Health & Beauty Solutions builds long-term partnerships with
international brand owners, providing specialist services including
product development, formulation, manufacturing and packaging in
Europe and the US.
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END
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