11 July 2024
DCC Energy divests majority stake in Hong Kong &
Macau liquid gas business
DCC plc, the leading international
sales, marketing and support services group, announces that DCC
Energy has completed the sale of a majority stake in its liquid gas
business in Hong Kong & Macau to CITADEL Pacific Ltd ("CPL"),
an Asian industrial group with an existing and complementary
business in the region.
The transaction values DCC's
business at an initial enterprise value of c.US$150 million (c.£117
million), on a debt-free, cash-free basis. DCC received US$105
million (c.£82 million) in cash consideration on completion, with
the balance of consideration represented by a retained minority
stake in the combined operations.
In retaining a minority stake, DCC
will benefit from the combination of the two businesses, which will
operate under both the Shell and Exxon brands. DCC has the option
to divest its remaining stake under an agreed mechanism after a
number of years.
In the financial year ended 31 March
2024, DCC's business in Hong Kong & Macau distributed the
equivalent of 183 million litres of liquid gas and recorded an
operating profit of US$19.5 (£15.6 million). The business generated
a return on capital employed of 11.7%1. The transaction
is expected to result in a modest exceptional profit in the year
ended 31 March 2025.
The business represented
approximately 2% of DCC's operating profit in the year ended 31
March 2024.
DCC Energy has significant growth
opportunities across its business in Europe and North America. The
transaction sharpens the strategic and regional focus of the
division in line with our Cleaner Energy in Your Power
strategy.
1 DCC Energy's divisional return on capital
employed in the same period was 18.7%
Donal Murphy, Chief Executive of DCC plc, said today:
"We are pleased to announce the sale
of a majority stake in our business in Hong Kong & Macau. I
would really like to thank our talented team in the region who have
built a very strong business. Their commitment and passion in
serving customers and driving performance has been exceptional
throughout our ownership. We look forward to partnering with CPL to
further develop our combined operations.
The disposal brings further
strategic and geographic focus to DCC Energy as we implement our
Cleaner Energy in Your Power strategy. We outlined the progress we
have made towards our 2030 vision at our full year results
presentation on 14 May last. We will continue to bring cleaner
energy for customers across Europe and North America."
Contact information
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Investor
enquiries:
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Kevin Lucey, Chief Financial Officer
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Tel: +353 1 2799 400
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Rossa White, Head of Group Investor Relations
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Email: investorrelations@dcc.ie
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Media
enquiries:
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Powerscourt (Eavan Gannon/Pete Lambie)
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Tel: +44 20 7250 1446
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Email:
DCC@powerscourt-group.com
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About DCC plc
Invest in what the world needs
DCC is a leading international sales, marketing and
support services group. We provide solutions the world needs across
three transformative sectors: energy, healthcare and technology;
where we acquire, improve and grow diverse businesses. We bring our
growth mindset to our businesses in 22 countries across four
continents, empowering our 16,600 employees to create long term
value - for our shareholders, customers, society and the
planet.
Headquartered in Dublin, DCC plc is listed on the
London Stock Exchange and is a constituent of the FTSE 100. In
our financial year ended 31 March 2024, DCC generated revenues
of £19.9 billion and adjusted operating profit
of £682.8 million. DCC has an excellent record, delivering
compound annual growth of 14% in adjusted operating profit and
unbroken dividend growth of 13% while maintaining high returns on
capital employed over 30 years as a public company.
Follow us on LinkedIn.
www.dcc.ie
About CITADEL Pacific Ltd
CITADEL Pacific Ltd ("CPL") is a diversified private
holding company with operations in the Philippines, Hong Kong,
Macau, the Republic of Palau, the Commonwealth of the Northern
Mariana Islands, and Guam. Its holdings range from
telecommunications, petroleum and gas distribution, property, and
business services. Recent investments entering the Solar and Data
Center businesses position CPL for further expansion in rapidly
growing sectors.
CPL is owned by the Delgado family. Through the
years, the company has grown through acquisitions and organic
growth and partnered with leading multinationals. The Company
reached over US$750 million in turnover in 2023.
Forward-looking statements
This announcement contains some forward-looking
statements that represent DCC's expectations for its business,
based on current expectations about future events, which by their
nature involve risk and uncertainty. DCC believes that its
expectations and assumptions with respect to these forward-looking
statements are reasonable, however because they involve risk and
uncertainty as to future circumstances, which are in many cases
beyond DCC's control, actual results or performance may differ
materially from those expressed in or implied by such
forward-looking statements.
