DCC plc

DCC - ANNUAL REPORT AND ACCOUNTS 2008

1

Annual Report and Accounts 2008

DCC - ANNUAL REPORT AND ACCOUNTS 2008

DCC is a procurement, sales, marketing, distribution and business 
support services group headquartered in Dublin. With international 
operations across sixteen countries and four continents, DCC 
employs approximately 7,000 people.  

DCC has five divisions - DCC Energy, DCC SerCom, DCC 
Healthcare, DCC Food & Beverage and DCC Environmental. 
Within these divisions there are 14 business units, ten of which are 
engaged in procurement, sales, marketing and distribution of own-
brand and third party branded products and four of which provide 
business support services:

  DCC Energy

DCC SerCom  

DCC Healthcare 

DCC Food & Beverage

DCC Environmental

  • Oil
  • LPG
  • Fuel cards

SerCom Distribution IT 
& entertainment  
products to
• Retailers
• Resellers
• Enterprise markets 

SerCom Solutions
•  Outsourced 
procurement 
and supply chain 
management services

• Acute care products
•  Mobility & Rehab 

• Healthfoods
• Indulgence foods

products

•  Outsourced solutions 
to the health & beauty 
sector

•  Chilled and frozen 

•  Waste management   

logistics

and recycling  
services

DCC’s strategy for continuing growth is through:

• a continued focus on its two broad business activities
-  procurement, sales, marketing and distribution
-  business support services

• constant attention to the creation of shareholder value through:
-  maximising organic growth
-  complementary bolt-on acquisitions
-  focusing on return on capital employed
-  focusing on cash generation

DCC - ANNUAL REPORT AND ACCOUNTS 2008

1

Highlights
for the year ended 31 March 2008

Revenue

Operating profit*

€5,532.0m

€167.2m

Reported +36.7%
Constant Currency +39.9%

Reported +19.3%
Constant Currency +21.8%

Adjusted earnings per share*

Dividend per share

165.06 cent

56.67 cent

Reported +15.0% **
Constant Currency +17.4% **

Reported +15.0%

All constant currency figures quoted in this report are based on retranslating current year figures at prior year translation rates
*  excluding net exceptionals and amortisation of intangible assets 
** continuing activities (excluding the Manor Park Homebuilders contribution in the prior year)                   

Adjusted EPS (cent) ** 
10 year CAGR 14.0%  

Group operating profit
geographic split

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Contents

Highlights 
Group at a Glance 
Board of Directors 
Senior Management 
Chairman’s Statement 
Chief Executive’s Review 
Business Review 
Financial Review 
Corporate Social Responsibility 
Report of the Directors 
Corporate Governance 
Report on Directors’ Remuneration and Interests 
Statement of Directors’ Responsibilities 
Report of the Independent Auditors 
Financial Statements 
Group Directory 
Shareholder Information 
Corporate Information 
Index 

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34
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57
111
115
117
118

2

DCC - ANNUAL REPORT AND ACCOUNTS 2008

DCC Group at a Glance

DCC Energy 
DCC Energy is the leading oil and liquefied petroleum gas (LPG) procurement, sales, marketing and distribution 
business in Britain and Ireland. The oil business sells heating oils, transport fuels and fuel oils to domestic, 
commercial, agricultural and industrial customers. The LPG business supplies propane and butane in both bulk  
and cylinders for heating, cooking, transport and industrial processes. 

Operating profit (€m)

10 Year CAGR 18.9%

5 Year CAGR 12.5%

Strong brands (*DCC owned)
•  Oil  
  Scottish Fuels*, Emo Oil*, CPL,  
  Shell, Carlton Fuels*. 

Market position
•  Oil  
  Largest oil distributor in Britain. 
  A leading player in oil distribution in Ireland.

Growth strategy
•  Organic growth in both Britain  
  and Ireland. 

•  Gas 
  Flogas*, Ergas*.

•  Fuel card 
  BP, Fastfuel, Esso, Diesel Direct,ReD.

•  Gas 

 Strong number 2 in LPG distribution in 
Britain and Ireland.

•  Fuel card 

 A leading player in the fuel card business 
in Britain.

•   Supplemented by acquisitions in both 
oil and LPG. Particular focus on a 
consolidation strategy in the highly 
fragmented British oil market.

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DCC SerCom
DCC SerCom comprises two businesses, SerCom Distribution and SerCom Solutions.  
•   SerCom Distribution markets and sells IT and entertainment products to the Retail, Reseller and Enterprise markets.
•   SerCom Solutions provides outsourced procurement and supply chain management services in Ireland, Poland, 

Operating profit (€m)

10 Year CAGR 9.2%

5 Year CAGR 4.1%

China and the USA. 

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Strong brands (*DCC owned)
•  Retail

Market positions
•  Retail

 20th Century Fox, Entertainment in Video, 
Creative Labs, Disney, EA, Exspect*, 
Garmin, Linx*, Logitech, Microsoft, Nintendo, 
Paramount, Symantec, Take Two, Warner. 

•  Reseller 

 Acer, Canon, D-Link, Fujitsu Siemens, HP, IBM, 
Lenovo, Netgear, Samsung, Sharp, Sony.

•  Enterprise 
  BP, Fastfuel, Esso, Diesel Direct, ReD.

•  Supply chain management 
  SerCom Solutions*.

 A leading distributor of consumer products to a 
broad range of retailers, e-tailers and catalogue 
retailers in Britain, Ireland and France. 

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•  Reseller

 A leading distributor of IT products to a broad 
range of resellers and computer dealers in 
Britain and Ireland.

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markets.

Sercom Solutions
•   Extending the offering of its world class 

procurement and sourcing services in the 
Americas and the Far East, together with 
extending its existing operations in Poland.

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 A leading distributor of enterprise products to 
value added resellers, large account resellers 
and independent software vendors in France, 
Iberia, Benelux, Britain and Ireland. 

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•  Supply chain management 

 A leading provider of outsourced procurement 
and supply chain management services.

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DCC Healthcare
DCC Healthcare is a broadly based healthcare business with operations encompassing:
•   Procurement, sales and marketing of healthcare products and provision of related services into the acute  

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Operating profit (€m)

10 Year CAGR 13.2%

5 Year CAGR 17.3%

•  Procurement, sales and marketing of rehabilitation products in Britain, Ireland, Germany, Australia, New Zealand  
  and other export markets ;
•  Provision of outsourced services to the health and beauty sector in Britain and continental Europe. 

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Market position
•  Acute care 

 Number 1 in sales and marketing of intra-
venous pharmaceuticals, medical, surgical and 
laboratory products in Ireland. A leading provider 
of value added distribution services to British 
hospitals and leading brand owners.

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•  Health and beauty 

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solutions to health & beauty companies. 

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•  Mobility & rehab 

 Number 1 in sales and marketing of 
physiotherapy products in Britain,  
Australia and New Zealand. 
A leader in sales and marketing of  
rehabilitation products in Britain.

Growth strategy
•  Acute care 
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healthcare products and related value-added 
services to the acute care sector.

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•  Health & beauty 
  Expand in European market for  
  outsourced solutions to the health and  
  beauty industry.

•  Mobility & rehab 

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 Build a substantial international rehabilitation 
business based on a broad portfolio of own 
brand products and procurement excellence.

•  All  
  Strong organic growth of existing  
  businesses, supplemented by acquisitions,  
  principally in Britain. 

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Strong brands (*DCC owned)
•  Acute care` 

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•  Mobility & rehab 
  Ausmedic*, Biofreeze, Days  
  Healthcare*, Metron*, Physio-Med*,  
  Theraband.

# Customers of DCC Health & Beauty Solutions

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DCC - ANNUAL REPORT AND ACCOUNTS 2008

3

DCC Food & Beverage 
DCC Food & Beverage markets and sells a wide range of company owned and agency branded food  
and beverage products in Ireland and has a wine business in Britain. It is a market leader in a number  
of niche market segments in healthfoods, indulgence foods and frozen & chilled logistics. 

Strong brands (*DCC owned) 
•  Healthfood 

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 Andrew Peace, Bollinger, Elizabeth Shaw, 
French Connection*, Hula Hoops, KP, 
Lemons*, McCoys, McVities / Mars Cakes, 
Phileas Fogg, Ritter, Robert Roberts*, 
Sacla, Topps, Torres.

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  Allied Foods*, Brodericks*, Kylemore.  

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•  Healthfood 
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 Market leading positions in healthy foods in 
Ireland. 

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 Number 2 in savoury snacks in Ireland.  
Number 2 in freshly ground coffee in Ireland.

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•  Logistics 
  A leading player in frozen and chilled  

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portfolio of branded health and indulgent 
foods and beverages.

•   Supplemented by acquisitions in Ireland 
and Britain that will exploit the growing 
demand for healthy food and beverage 
products and strengthen other existing 
market positions.

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food distribution in Ireland.

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Operating profit (€m)

10 Year CAGR 11.9%

5 Year CAGR 10.4%

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Operating profit (€m)

9 Year CAGR 79.1%

5 Year CAGR 33.3%

DCC Environmental
DCC Environmental provides a broad range of waste management and recycling services to the industrial, commercial, 
construction and public sectors in Britain and Ireland. Through its 50% shareholding in William Tracey and its subsidiary 
Wastecycle, DCC Environmental has built a significant position in the British waste management and recycling industry. 
DCC Environmental’s subsidiary, Enva, is the leading hazardous waste treatment business in Ireland.

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Strong brands # (*DCC owned) 
Enva* Wastecycle*, Tracey.

Market position
•   The leading recycling and waste 

management business in Scotland.

•   A leading recycling and waste management 

company in Nottingham.

•   Number 1 hazardous waste treatment 

business in Ireland.

Growth strategy
•   Organic growth opportunities arising from 
increased enforcement of environmental 
legislation and increased recycling driven 
by rising landfill costs.

•  Supplemented by acquisitions in Britain 

and Ireland.

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4

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Board of Directors

Michael Buckley
Chairman

Michael Buckley MA, LPh, MSI (63) was appointed non-executive Chairman on 27 May 2008. He is also a non-
executive director of a number of publicly quoted companies in the UK and in the USA, a senior adviser to a number 
of privately owned Irish and international companies, an adjunct professor at the Department of Economics in UCC 
and a board member of Enterprise Ireland. He was Group Chief Executive of Allied Irish Banks plc from 2001 to 2005 
having served as Managing Director of AIB Capital Markets and AIB Poland. Previously, he was Managing Director of 
NCB Group and a senior public servant in Ireland and the EU. Mr. Buckley joined the Board in 2005. 

Tommy Breen
Chief Executive

Tommy Breen, B Sc (Econ), FCA, (49) was appointed Chief Executive on 27 May 2008 having been Group Managing 
Director since July 2007. He was previously Chief Operating Officer having held a number of senior management 
positions in the Group, including those of Managing Director of DCC’s Energy and SerCom divisions. Mr. Breen retains 
responsibility for DCC Environmental. He joined DCC in 1985, having previously worked with KPMG. Mr. Breen joined 
the Board in 2000.

Tony Barry
Non-executive Director

Tony Barry, Chartered Engineer, (73) was Chairman of CRH plc from 1994 to 2000, having previously been Chief 
Executive. He is a former Deputy Governor of the Bank of Ireland and was a member of its Court of Directors. He was 
Chairman of Greencore Group plc and is a past President of The Irish Business and Employers’ Confederation. Mr. 
Barry joined the Board in 1995.

Róisín Brennan
Non-executive Director

Róisín Brennan, BCL, FCA, MSI, (43) is Executive Chairman of IBI Corporate Finance having been Chief Executive 
since 2006. She has had extensive experience advising public companies in Ireland, principally in relation to strategy 
and mergers & acquisitions. Ms. Brennan also served as a non-executive director of The Irish Takeover Panel during 
2000/2001. Ms. Brennan joined the Board in 2005.

Jim Flavin
Executive Chairman (resigned 27 May 2008)

Jim Flavin, B Comm, DPA, FCA (65) founded DCC and was Executive Chairman from 1 July 2007 until his resignation 
from the Board and his executive position on 27 May 2008. He had been Chief Executive since the foundation of the 
Company in 1976. Prior to founding DCC, Mr. Flavin was head of AIB Bank’s venture capital unit.  From 1999 to 2001, 
he was Deputy Chairman and Senior Independent Director of eircom plc. Mr. Flavin was the first Chairman of the Irish 
Venture Capital Association and was a member of the Steering Committee, established by the European Commission, 
that founded the European Venture Capital Association. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

5

Paddy Gallagher
Non-executive Director

Paddy Gallagher, BL, DPA, (68) retired as Head of Legal and Pensions Administration at Guinness Ireland Group in 
2000. He is Chairman of the Trustees of the An Post Superannuation Schemes and of the Guinness Ireland Group 
Pension Scheme and is a former Chairman of the Irish Association of Pension Funds. Mr. Gallagher joined the Board 
in 1976.

Maurice Keane
Non-executive Director

Maurice Keane, B Comm, M Econ Sc, (67) was a member of the Court of Directors of Bank of Ireland from 1983 to 
2005, and Chief Executive from 1998 to 2002. He is a director of Axis Capital Holdings Limited and is a member of 
the National Pension Reserve Fund Commission. Previously, Mr. Keane was Chairman of BUPA Ireland and of Bristol & 
West plc. Mr. Keane joined the Board in 2002. 

Fergal O’Dwyer
Executive Director

Fergal O’Dwyer, FCA, (48) has been Chief Financial Officer since 1994. He joined DCC in 1989 having previously 
worked with KPMG in Johannesburg and Price Waterhouse in Dublin. Mr. O’Dwyer joined the Board in 2000.

Bernard Somers
Non-executive Director

Bernard Somers, B Comm, FCA, (59) is a non-executive director of Allied Irish Banks plc, Independent News and 
Media plc and Irish Continental Group plc. He is a former director of the Central Bank of Ireland. Mr. Somers is the 
founder of Somers & Associates, which has built a substantial practice in corporate restructuring. He has also been 
an investor in and a director of several start-up companies. Mr. Somers joined the Board in 2003 and is the Senior 
Independent Director.

Alex Spain
Chairman (retired 30 June 2007)

Alex Spain, B Comm, FCA (76) was non-executive Chairman from the foundation of DCC in 1976 until his retirement 
from the Board on 30 June 2007. He is a director of a number of other companies. He was Managing Partner of 
KPMG in Ireland from 1977 to 1984. Mr. Spain is a former President of the Institute of Chartered Accountants in 
Ireland and a former Chairman of the Financial Services Industry Association in Ireland.

Audit Committee 
Bernard Somers (Chairman) 
Róisín Brennan 
Maurice Keane 

Nomination Committee 
Michael Buckley (Chairman) 
Maurice Keane 
Bernard Somers 

Remuneration Committee
Maurice Keane (Chairman)
Róisín Brennan
Michael Buckley
Bernard Somers

 
 
6

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Senior Management
group and divisional

Tommy Breen  
Director  

Fergal O’Dwyer  
Director

Chief Executive

Chief Financial Officer

Conor Costigan 

Managing Director DCC Healthcare

Niall Ennis 

Frank Fenn  

Managing Director DCC SerCom

Managing Director DCC Food & Beverage 

Donal Murphy  

Managing Director DCC Energy

Ann Keenan  

Head of Group Human Resources

Colman O’Keeffe  

Deputy Managing Director DCC Energy

Peter Quinn 

Head of Group IT

Michael Scholefield   Managing Director DCC Corporate Finance

Gerard Whyte  
Group Secretary 

Compliance Officer & 
Head of Enterprise Risk Management 

 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

7

Senior Management
subsidiaries and joint ventures

DCC Energy

Oil 

LPG  

Fuel card 

GB Oils  
Emo Oil 
DCC Energy (NI) 
Flogas UK 
Flogas Ireland 
Fuel Card Group 

Sam Chambers 
Gerry Wilson 
Pat O’Neill 
Paddy Kilmartin 
Richard Martin 
Ben Jordan 

Managing Director
Managing Director
Operations Director 
Managing Director
Managing Director
Chief Operations Officer

DCC SerCom

Retail 

Reseller 

Enterprise 
Supply chain management 

Gem Distribution 
Pilton 
Banque Magnetique 
Micro Peripherals 
Sharptext 
Distrilogie 
SerCom Solutions 

Chris Peacock 
Nick Furlong 
Claude Dupont 
Mike Alden 
Paul White 
Patrice Arzillier 
Kevin Henry 

Managing Director
Managing Director
Directeur Général
Managing Director
Managing Director
Directeur Général
Chief Executive Officer

DCC Healthcare

Acute care 

Health & beauty solutions  

Mobility & rehab  

Fannin  
Squadron Medical 
DCC Health & Beauty Solutions 
Eurocaps 
Laleham 
DCC Mobility & Rehab 
Ausmedic Australia 
Physio Med Services 

Andrew O’Connell 
Peter Wyslych 
Stephen O’Connor 
Adrian Williams 
Tim O’Connor 
Graham White 
Ashley Williams 
John Gregory 

Managing Director
Managing Director 
Managing Director
Managing Director
Managing Director 
Managing Director
Managing Director
Managing Director

DCC Food & Beverage

Health food 
Indulgence 

Logistics 
Other 

Kelkin 
Robert Roberts 
Bottle Green 
Allied Foods 
Broderick Bros 
Kylemore Foods Group * 

Bernard Rooney 
Tom Gray 
Jon Eagle 
John Casey 
Richard Kieran 
Brian Hogan 

Managing Director
Managing Director
Managing Director 
Managing Director
Managing Director
Managing Director

DCC Environmental

William Tracey * 
Wastecycle 
Enva 

Michael Tracey 
Mike Shearstone 
Declan Ryan 

Managing Director
Executive Chairman
Managing Director

* Joint venture

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Chairman’s Statement

Michael Buckley
Chairman

“ DCC’s excellent track record of fourteen years’ 
unbroken profit growth is based on a good mix of 
organic growth and successful acquisitions. Its strong 
financial position and experienced management team 
are the foundations on which we can look forward to 
a continuation of its robust performance.”

Board changes
On Jim Flavin’s resignation as Executive 
Chairman and as a Director of DCC on 27 
May 2008, the Board appointed me as 
non-executive Chairman and appointed 
Tommy Breen, who had been Group 
Managing Director since July 2007, as 
Chief Executive. I want to begin this, my 
first statement as Chairman, by paying 
tribute to Jim Flavin for the robust, balanced 
and growth-oriented company he created 
and led over a 32 year period. Since I 
joined the Board, in September 2005, I 
have been struck by the quality, focus and 
cohesiveness of the management team he 
built. At Board level, the six non-executive 
directors bring considerable and varied 
experience and independence of judgment 
to the table. 

Two key tasks for me in the coming year 
will be

•  To ensure Board oversight of the strategic 
review process which has been under way 
for some time and which will be completed 
by March 2009. Every company needs 
to undertake such a review periodically 
to ensure that it is maximising the growth 
opportunities available to it and that it is 
correctly structured to ensure that the 
market reflects the inherent value of its 
business lines.

•  To ensure as a priority during the current 
financial year that significant progress 
is made in the ongoing task of Board 
renewal, balancing continuity with the 
need to bring in fresh and relevant 
experience. 

In respect of both these tasks, and in 
everything else I do as Chairman, it will 
be my aim to ensure that I hear and listen 

to the views of DCC’s shareholders, both 
domestic and international, a task which I 
have already begun through a programme 
of meetings with significant shareholders.

Results overview
The year to 31 March 2008 was an 
excellent year of growth and development 
for DCC. The results reflect strong organic 
growth and a contribution from successful 
acquisitions. Highlights of the year include:
•  36.7% growth in revenue to €5.532 

billion, driven by strong organic growth, 
the increase in energy prices and 
acquisitions.  

•  Excellent growth in operating profit of 
19.3%, maintaining DCC’s unbroken 
record of profit growth since flotation 
in 1994. Compound annual growth in 
operating profits in the 14 years since 
flotation is 15.5%.

•  Adjusted earnings per share from 

continuing activities (excluding the Manor 
Park Homebuilders contribution in the 
prior year) increased by 15.0%.  

Dividend increase
The Directors are recommending a final 
dividend of 36.12 cent per share which, 
when added to the interim dividend of 
20.55 cent per share, gives a total dividend 
of 56.67 cent per share for the year, a 
15% increase over the prior year dividend 
of 49.28 cent per share.  The dividend is 
covered 2.9 times by adjusted earnings per 
share (3.2 times in 2007). It is proposed to 
pay the final dividend on 24 July 2008 to 
shareholders on the register at the close of 
business on 30 May 2008.  

Fyffes case
Issues arising from the Irish Supreme 
Court decision on the Fyffes case have 
been a matter of concern during the year. 
Shareholders will be aware that, on 27 July 
2007, the Supreme Court, overturning a 
decision by the High Court, found that two 
trading reports, which Jim Flavin had in his 
possession as a director of Fyffes at the time 
of the sale of 31,169,493 shares in Fyffes 
in 2000, were price sensitive. As a result 
of the Supreme Court decision, DCC was 
obliged to pay to Fyffes a sum that was to 
be determined by the High Court, relating to 
the profits on the sale. As announced on 14 
April 2008, a settlement was subsequently 
agreed with Fyffes and counterparties in 
respect of all claims, interest and costs for 
an amount of €41 million. An exceptional 
charge of €50 million for this amount and 
DCC’s own costs has been made in these 
financial statements.

Following announcement of the settlement, 
the Board was for the first time in a position 
comprehensively to set out the factors 
which it had taken into account in deciding 
to endorse Jim Flavin’s continuation in his 
three year transitional role as Executive 
Chairman. It did so in a statement reviewed 
by the Company’s solicitors, specifically in 
relation to any reference made in it to the 
Court judgments, which was included in a 
Stock Exchange announcement on 20 May 
2008. (The statement forms the appendix 
to the Corporate Governance section of this 
Annual Report and Accounts).

The matters which the Board reviewed 
and the factors which it took into account 
in coming to its decision were intrinsically 
complex and required judgment. The 
process it undertook was rigorous and in 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

9

Revenue

+36.7%

Operating profit

+19.3%

accordance with corporate governance 
standards. Our judgment as experienced 
business people was exercised with 
appropriate advice, and in good faith. We 
based it solely on our assessment of what 
was in the overall interest of the Company 
and its shareholders. However, we have 
always understood that others might 
come to a different judgment. There has 
been very substantial Irish media coverage 
of the case. 

Throughout the period since the Irish 
Supreme Court ruling and the subsequent 
Board decision, I, as the then Senior 
Independent Director, had been available 
to shareholders, both domestic and 
international, to discuss any issues they 
had in that context. Feedback from a large 
majority of shareholders was supportive 
of the Board position, but discussions 
with the Irish Association of Investment 
Managers (IAIM), whose members 
collectively hold about 15% of the DCC 
share capital, in the second half of 2007 
had resulted in the Association reserving 
its position.   

Some weeks after the announcement 
of the settlement referred to above, the 
IAIM informed me that its members 
disagreed with the Board position. On 22 
May 2008, the IAIM issued a statement in 
which it made it clear that it had reached 
a different judgment to the Board and in 
which it said “the IAIM does not consider 
it appropriate for Mr. Flavin to continue as 
Executive Chairman of DCC”.

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years ended 31 March

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10 yrs 16.6%

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On 26 May 2008,  when the Board 
met to discuss the IAIM statement, Jim 
Flavin informed it that he was seriously 
considering resigning. The following day, 
the Board learned of the intention of the 
Irish Director of Corporate Enforcement 
(ODCE) to apply to the High Court for 
the appointment of Inspectors, under 
Section 8 of the Companies Act, 1990, to 
investigate and report on whether certain 
provisions of the Companies Acts were 
breached in the transactions relating to the 
intra-group transfer of the Fyffes shares by 
DCC in 1995 and their disposal in 2000. 
When the Board met that day to discuss 
this development, Jim Flavin informed it 
that his decision to resign was final, due 
to the continuing uncertainty arising from 
the outcome of the Fyffes litigation. A 
Stock Exchange announcement to that 
effect was made on the evening of 27 May 
2008.

The ODCE application will be heard by the 
High Court on 19 June 2008.

Corporate governance and 
risk management
A detailed statement, set out on pages 44 
to 49, describes how DCC has applied 
the Principles of Good Governance 
and Code of Best Practice as set out 
in the Combined Code on Corporate 
Governance. In line with a number of 
companies internationally, the Directors 
have decided, starting with this year’s 
Annual General Meeting, to adopt the 
practice that all Directors will present 
themselves for re-election at each Annual 
General Meeting. 

The Board is satisfied that the Group has 
effective ongoing processes for identifying, 
evaluating and managing risks faced 
by the Group. DCC’s Group Secretary, 
Gerard Whyte, also heads up DCC’s 
Enterprise Risk Management function 
which incorporates Group Internal Audit 
and Group Environmental Health and 
Safety.  The Board is satisfied that this 
is a high quality unit which carries out its 
function in an independent, dedicated 
and responsible fashion. In addition, 
the Chief Executive acts as Chairman 
of an executive Risk Committee, which 
constantly monitors and addresses Group 
risks, including issues raised by Enterprise 
Risk Management.

Management and staff
A key strength of the DCC Group is the 
commitment and loyalty of the 7,000 
management and staff throughout the 
sixteen countries in which we operate.  On 
behalf of the Board, I wish to thank them 
for their commitment and loyalty to DCC 
and congratulate them on delivering very 
good results for the year.

Outlook
There is a less favourable economic 
backdrop against which to do business 
in the current financial year. However, 
we have had a good start . We intend to 
continue to grow both organically and by 
acquisition and believe that the climate for 
making acquisitions will favour companies 
with strong balance sheets such as DCC.

Michael Buckley
Chairman
9 June 2008

10

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Chief Executive’s Review

Tommy Breen
Chief Executive

“  In the year ended 31 March 2008, DCC 
enjoyed excellent growth in revenue, 
operating profit and adjusted earnings per 
share. Operating profit growth, on a constant 
currency basis, was 21.8%, of which 
approximately 8% was organic.”

Results highlights

Revenue 

Operating profit* 

Exceptional profit (net) 

Profit before tax  

Adjusted earnings per share* 

Dividend per share 

Change on prior year

Constant 

Reported 

currency

+36.7% 

+19.3% 

+39.9%

+21.8%

+12.3% 

+14.2%

€ 
5,532.0m 

167.2m 

39.6m 

181.7m 

165.06 cent 

+15.0%** 

  +17.4%**

56.67 cent 

+15.0% 

All constant currency figures quoted in this report are based on retranslating current year figures at prior year translation rates

*   excluding net exceptionals and amortisation of intangible assets

**   continuing activities (excluding the Manor Park Homebuilders contribution in the prior year) 

 In the year ended 31 March 2008, DCC enjoyed excellent growth in revenue, operating 
profit and adjusted earnings per share. Operating profit growth, on a constant currency 
basis, was 21.8%, of which approximately 8% was organic. The growth momentum 
achieved in the first half of the year accelerated in the seasonally more significant 
second half. A summary of the second half and first half operating profit by division is 
set out hereunder:

Second half 

Change on prior year 

First half 

Change on prior year

€’m 

Reported 

currency 

€’m 

Reported 

currency

Constant  

Constant

Operating profit* 

DCC Energy 

DCC SerCom 

DCC Healthcare 

DCC Food & Beverage 

DCC Environmental 

59.8 

27.6 

13.1 

8.3 

   6.8 

+25.2% 

+24.8% 

+2.5% 

+7.1% 

 +30.1% 

+27.9% 

+5.4% 

+7.5% 

+16.7% 

+23.8% 

14.5 

12.5 

10.4 

7.0 

   7.2 

+23.9% 

+18.8% 

+6.5% 

-4.3% 

+22.4%

+18.0%

+5.9%

-4.4%

+56.7% 

+54.9%

Group operating profit 

 115.6 

+20.1% 

+24.1% 

51.6 

+17.6% 

+16.7%

*  excluding net exceptionals and amortisation of intangible assets

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

11

CAGR
10 yrs 14.9%

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Exceptional profit 
As DCC announced on 19 December 
2007, the dividend received from Manor 
Park Homebuilders and the subsequent 
sale of the shareholding gave rise to a profit 
on cost of €180 million and an exceptional 
profit on carrying value of €94.7 million. 
This exceptional profit, less the exceptional 
charge of €50 million for the settlement 
and costs of the Fyffes action (announced 
on 14 April 2008) and other net exceptional 
charges of €5.1 million, resulted in a net 
exceptional profit before tax in the year of 
€39.6 million. 

Adjusted earnings per share

Operating profit (continuing) –
years ended 31 March

+15.0%

Dividend per share

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Divisional highlights
Detailed business reviews for each of the 
five divisions are set out on pages 14 to 33. 
Some of the highlights of the year include:

•  DCC Energy sold 4.3 billion litres of 

product in the year, an increase of 32.3% 
on the previous year’s 3.2 billion litres. 
The most significant part of this increase 
was in the British oil distribution business 
which started the year as clear market 
leader and, through strong organic 
growth and a number of acquisitions, 
ended the year approximately three 
times the size of its nearest competitor. 
The largest acquisitions were those 
of CPL Petroleum, a large nationwide 
oil distributor, and Southern Counties 
Fuels, a regional distributor based in 
the south of England. DCC Energy’s oil 
distribution business in Britain now has 
an approximate 10% share of a very 
fragmented market and has an excellent 
platform from which to grow. 

•  DCC SerCom has significantly 

strengthened its position in European 
retail consumer electronics distribution 
through the acquisition of Banque 
Magnetique, a Paris based company. 
Banque Magnetique is a leading 
distributor of consumer electronics and 
IT peripherals to the French retail market. 
This acquisition brings DCC SerCom 
important new supplier relationships, a 
new customer base and a platform from 
which to grow its sales of DCC’s range of 
own branded products. 

•  DCC Healthcare achieved one of its 
key strategic objectives by creating a 
platform for growth in the acute care 
sector in Britain through the acquisition of 
Squadron Medical, a Derbyshire based 
company. Squadron provides specialist 
value added distribution services to 
British acute care hospitals and to leading 
healthcare brand owners. Since the year 
end, DCC has completed the bolt-on 
acquisition of a complementary Scottish 
based business. These businesses, which 
will be integrated over the coming year, 
provide DCC Healthcare with increased 
scale and opportunity to build a significant 
acute care business in Britain. 

•  DCC Food & Beverage achieved excellent 

organic growth in sales of its own 
branded Kelkin products during the year. 
Kelkin is the leading Irish brand of healthy 
foods and beverages, selling directly to 
the grocery sector and has benefited 
from increased investment in the brand 
in recent years. Particularly encouraging 
was the momentum achieved during 
the year in sales of the Kelkin branded 
VMS range of products to the pharmacy 
sector, which had been initially rolled out 
in 2006. 

•  In DCC Environmental, both William 

Tracey (in which DCC has a 50% joint 
venture shareholding) and Wastecycle 
enjoyed excellent organic growth. These 
companies have specialist recycling 
skills and are benefiting from increased 
legislation and landfill tax in Britain. New 
regulations, requiring all waste to be 
treated prior to disposal to landfill and 
a doubling of landfill tax between April 
2008 and April 2010, provide a positive 
background for these businesses. 

 
 
12

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Chief Executive’s Review
(continued)

“ During the financial year, DCC spent  
€179.6 million on acquisitions, more than 
in any previous year. These acquisitions 
provide new platforms for growth across a 
number of our businesses.”

Acquisitions and organic 
development expenditure
Acquisition and organic development 
expenditure, including additional working 
capital investment in the year, amounted to 
€351.6 million as set out below.

During the financial year, DCC spent 
€179.6 million on acquisitions, more than 
in any previous year. These acquisitions 
provide new platforms for growth across a 
number of our businesses. 

During the year, capital expenditure of 
€87.6 million was spent on facilities and 
equipment across the Group to support 
future growth.

The net increase in working capital in the 
Group was €84.4 million. The principal 
increase was in DCC Energy which primarily 

resulted from the higher cost of oil. DCC 
SerCom’s working capital levels were 
reduced by €20.5 million. 

Against the background of this significant 
acquisition and development expenditure, 
DCC’s return on capital employed 
(including intangible assets) remained 
strong at 17.5% compared to 17.9% in the 
prior year.

Financial strength 
At 31 March 2008, DCC had net debt 
of €123.7 million (€100.5 million: 2007) 
and total equity of €742.4 million (€687.7 
million: 2007). The Group’s net debt levels 
averaged €242 million during the year 
compared to €232 million in the prior year.
DCC continues to be well placed financially 
to pursue its organic and acquisition 
growth objectives. 

DCC Energy 

DCC SerCom 

DCC Healthcare 

DCC Food & Beverage 

DCC Environmental 

Total 

Acquisitions 
€’m 

105.2 

50.5 

21.8 

    -  

   2.1 

179.6 

Capex 
€’m 

38.2 

3.2 

15.1 

17.1 

14.0 

87.6 

Working   

Capital 
€’m 

101.6 

(20.5) 

6.3 

(5.2) 

  2.2 

84.4 

Total
€’m

245.0

33.2

43.2

11.9

18.3

351.6

 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

13

“ DCC has had an excellent start to the 
current financial year and continues to be 
well positioned both commercially and 
financially to augment growth through 
acquisition activity.”

Strategy review
As previously announced, a reappraisal of 
DCC’s overall strategic direction is being 
undertaken so that DCC is best positioned 
for sustainable long-term growth. This 
process is ongoing and recommendations 
will be reviewed by the Board at the end of 
the financial year.

the completion of the strategy reappraisal 
process and will continue to be mindful of 
the fact that the management of diversity 
is a core competence of DCC. The central 
objective is to ensure that DCC continues 
to pursue a strategy which maximises 
shareholder value on a consistent basis 
over the long term. 

This reappraisal does not imply that 
DCC’s strategy is in some way flawed. 
Demonstrably, the strategy that DCC 
has pursued since it went public in 1994 
has delivered consistently good results. 
However, the diversity of DCC’s business 
model, while reducing risk, makes DCC 
more complex from a management 
perspective and more difficult to explain to 
investors. 

The highly profitable realisation of value 
by DCC of its 49% shareholding in Manor 
Park Homebuilders last December was 
part of DCC’s strategy to redeploy capital 
into core business activities.  Shareholders 
will be familiar with DCC’s market sector 
based divisions, DCC Energy, DCC 
SerCom, DCC Healthcare, DCC Food 
& Beverage and DCC Environmental. 
Within these five divisions there are 
fourteen businesses, each with different 
characteristics such as return on capital, 
growth records and opportunities, 
competitors and management expertise. 

In the reappraisal of DCC’s strategy, the 
Board will analyse the relative opportunity 
to create shareholder value from each of 
these business units. Shareholders should 
not anticipate any particular change in 
strategy at this stage. The Board will 
come to a logical conclusion based on 

Corporate social responsibility
DCC recognises its responsibilities to 
all stakeholders and is fully committed 
to the management of all aspects of its 
business to the highest standards to 
fulfil these responsibilities. This is set out 
in the Corporate Social Responsibility 
statement on pages 40 to 41. DCC 
currently employs approximately 7,000 
people in sixteen countries. We encourage 
a management culture throughout 
the Group that properly respects the 
contribution of each employee. I thank 
them all for their contribution.

Jim Flavin
On 27 May 2008, Jim Flavin, who founded 
DCC in 1976, resigned as Executive 
Chairman. Since its foundation, Jim has 
led the hugely successful development 
of DCC with exceptional passion and 
commitment. I worked closely with Jim for 
more than twenty two years and was the 
beneficiary of his inspirational leadership 
and vision throughout that period. All of 
my colleagues throughout the Group and I 
would like to wish Jim and his family every 
success and happiness in the future.

It is an honour to have been appointed 
Chief Executive of a company with the 
track record of success of DCC and I look 

forward to continuing to work closely with 
the exceptional team of people throughout 
the Group.

On 27 May 2008, Michael Buckley was 
appointed non-executive Chairman and I 
was appointed Chief Executive. Michael 
joined the Board of DCC in 2005 and 
was Senior Independent Director. We are 
fortunate to have a person of Michael’s 
skills and experience as Chairman. 

Outlook
DCC is budgeting for strong earnings 
growth in the range of 12% to 15%, on 
a constant currency basis, in the current 
financial year. However, the impact of the 
translation of the significant proportion of 
DCC’s profits that are sterling based into 
euro at the approximate current exchange 
rate of Stg£0.80 = €1 would result in 
reported earnings growth in the range of 
2% to 5%. 

DCC has had an excellent start to the 
current financial year and continues to be 
well positioned both commercially and 
financially to augment growth through 
acquisition activity.

Tommy Breen
Chief Executive
9 June 2008

 
14 DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Energy

DCC Energy is the leading oil and liquefied petroleum gas (LPG) sales, marketing and distribution 
business in Britain and Ireland. DCC sold 4.36 billion litres of product to c. 500,000 domestic, 
commercial, industrial and agricultural customers from its extensive network of 194 depots 
throughout Britain and Ireland. 

DCC Energy currently employs approximately 2,700 people. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

15

Revenue

€3,420.0m

Operating profit

€74.3m

Revenue 
Operating profit 
Return on capital employed
- excluding intangible assets 
- including intangible assets 

  Change on prior year
  Constant 
2007  Reported  Currency

2008 

€3,420.0m  €2,247.9m 
€59.5m 

€74.3m 

+52.1% 
+25.0% 

+56.5% 
+28.6%

45.8% 
20.6% 

49.9%
22.7%

 
 
 
 
 
 
 
16 DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Energy

DCC sells oil under a portfolio of strong brands including Carlton Fuels, CPL, Emo Oil, Scottish Fuels and Shell.

Businesses and markets
DCC Energy’s oil business supplies 
heating oils, transport fuels and fuel oils 
to domestic, commercial, agricultural 
and industrial customers in Britain and 
Ireland. DCC is the largest oil distributor 
in Britain, selling c. 3.2 billion litres of 
product on a pro forma basis, which gives 
DCC approximately 10% of the market*. 
DCC has been a consolidator of the highly 
fragmented oil distribution market in Britain 
having first entered the market with the 
acquisition of BP’s business in Scotland in 
September 2001. 

In Northern Ireland, DCC Energy is 
the largest oil distributor with a market 
share of approximately 20%, while in 
the Republic of Ireland, DCC Energy has 
approximately 7% of the market. DCC 
Energy sells oil under a portfolio of strong 
brands including Carlton Fuels, CPL, Emo 
Oil, Scottish Fuels and Shell. DCC has 
an excellent operational infrastructure in 
the oil business which it has leveraged 
to grow strongly in the national account 
sector of the market.

The LPG business supplies propane 
and butane in both bulk and cylinders to 
domestic, commercial, agricultural and 
industrial customers for heating, cooking, 
transport and industrial processes and 
has an extensive operational infrastructure 
in both Britain and Ireland. Trading under 
the Flogas brand, DCC Energy is the 
number two player in the LPG market 
in both Britain and Ireland with market 
shares of approximately 20% and 36% 
respectively. DCC has been a consolidator 

of the British LPG market and has created 
significant shareholder value over the last 
number of years through its acquisition 
and integration activities. The business 
also distributes a range of LPG fuelled 
appliances such as mobile heaters, 
barbeques and patio heaters. 

DCC first entered the fuel card market 
through the acquisition of the Fuel Card 
Group in January 2005. The business 
now sells in excess of 255 million litres 
of motor fuel annually via a portfolio of 
fuel cards under the BP, Esso, Shell, 
Texaco, Diesel Direct and ReD brands. 
Fuel cards have become an essential tool 
for commercial organisations to manage 
their ever increasing transport fuel costs 
and DCC Energy provides its customers 
with access to the breadth of the UK 
retail petrol station and bunker networks 
through its portfolio of branded fuel cards. 
In addition, DCC provides its customers 
with detailed information on their fuel 
utilisation to enable them to minimise their 
transport costs. 

DCC Energy purchases its oil and LPG 
from the major oil companies and has 
excellent long-standing relationships 
with the major suppliers in the market, 
operating a portfolio approach to the 
management of its supply base. DCC’s 
financial strength enables DCC Energy 
to be a preferred partner of the major oil 
companies, which is particularly important 
in these days of high oil prices. 

Performance management
DCC has over 30 years involvement in the 
energy distribution market and with this 
comes a depth of experience and industry 
knowledge which enables DCC to drive 
superior returns. The business demands 
detailed hands-on management and the 
performance of the business is constantly 
monitored through a broad range of key 
indicators, principally focused on sales 
volume growth, margin, operational and 
cost efficiencies, cash flow and capital 
utilisation.

Over the past 10 years, DCC Energy has 
achieved a compound annual growth rate 
of 18.9% in operating profit. 

Performance for the year 
ended 31 March 2008
DCC Energy achieved excellent growth 
in the year with operating profit 25% 
ahead of the prior year. Operating profit 
growth on a constant currency basis 
was 28.6%, of which organic growth 
was approximately 10%. This result 
was particularly pleasing considering 
it was another year of above average 
temperatures, albeit colder than the prior 
year. The business also had to deal with 
the dramatic rise in the cost of product 
during the year. 

DCC Energy sold 4.3 billion litres of 
product in the year, an increase of 32.3% 
on the prior year, further strengthening 
its position as the leading oil and LPG 
distributor in Britain and Ireland. 

*  The market is defined as fuels sold to the domestic, commercial, agricultural, industrial and haulage sectors of the transport fuels 

market (i.e. excluding the retail petrol station market). 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

17

Flogas supplies LPG in both bulk and cylinders to domestic and commercial customers.

“ A consolidator 
of the highly 
fragmented oil 
distribution market 
in Britain.”

In the LPG market, DCC Energy will 
continue to leverage its position as the 
strong number two player in the market to 
drive organic growth on a sector by sector 
basis in both Britain and Ireland. 

DCC Energy will continue to target high 
levels of organic growth in the fuel card 
market and invest in new telesales teams 
to cross-sell fuel cards to its extensive oil 
distribution customer base. DCC Energy 
will continue to position itself as the 
partner of choice for all the providers of 
branded fuel cards in the market. 

Outlook
DCC Energy is budgeting for excellent 
constant currency operating profit growth 
in the current financial year. 

DCC sells motor fuel through a portfolio of fuel cards 
under the BP, Emo, Esso, Shell, Texaco, Diesel Direct 
and ReD brands.

It was an excellent year of growth and 
development for the oil business in 
Britain. The business benefited from 
the acquisitions completed in the prior 
year and first time contributions from 
acquisitions completed during the year. 
DCC Energy achieved excellent organic 
growth from its extensive nationwide 
infrastructure and from its focus on 
growing the proportion of its business in 
the non heating dependent segments of 
the market.

The LPG business increased its sales 
volumes during the year, but the dramatic 
rise in the price of propane resulted in a 
modest, short-term reduction in operating 
profit. 

DCC’s fuel card business had another 
year of excellent growth, with the business 
benefiting from the integration of an 
acquired fuel card business and strong 
organic volume growth.

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Strategy and development
In oil distribution, DCC’s strategy is to 
achieve a 20% share of the British market. 
Having established strong market shares 
in both Scotland and the north of England, 
the primary focus is on developing its 
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infrastructure to drive high levels of organic 
growth, with a particular focus on the non 
heating dependent segments of the market 
and on national accounts. The business 
is also focused on cross-selling add-on 
products and services, such as lubricants 
and boiler maintenance services, to its 
extensive customer base. 

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Donal Murphy
Managing Director

“ DCC Energy sold 4.3 
billion litres of product to 
c. 500,000 customers in 
Britain and Ireland”

Operating profit (€m)

10 Year CAGR 18.9%
5 Year CAGR 12.5%

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18

DCC - ANNUAL REPORT AND ACCOUNTS 2008
18

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC SerCom

DCC SerCom comprises two businesses, SerCom Distribution and SerCom Solutions. 

SerCom Distribution markets and sells IT and entertainment products to

•   the Retail market - a leading distributor of consumer electronics, peripherals and home 

entertainment products to retailers, e-tailers and catalogue retailers in Britain, Ireland and France 
•   the Reseller market - a leading distributor of IT products to the reseller and dealer channel in Britain 

and Ireland , and

•   the Enterprise market - a leading European distributor of enterprise servers, storage and software to 

value-added resellers, large account resellers and independent software vendors.

SerCom Solutions provides outsourced procurement and supply chain management services in 
Ireland, Poland, China and the USA. 

DCC SerCom currently employs approximately 1,360 people.

DCC - ANNUAL REPORT AND ACCOUNTS 2008
19

DCC - ANNUAL REPORT AND ACCOUNTS 2008

19

Revenue

€1,423.4m

Operating profit

€40.1m

Revenue 
Operating profit 
Operating margin 
Return on capital employed
- excluding intangible assets 
- including intangible assets 

  Change on prior year
  Constant 
2007  Reported  Currency

2008 

+16.9% 
+22.9% 

+18.8%
+24.7%

€1,423.4m  €1,218.0m 
€32.6m 
2.7% 

€40.1m 
2.8% 

24.2% 
15.3% 

22.4% 
13.8%

 
 
 
 
 
 
 
 
20

DCC - ANNUAL REPORT AND ACCOUNTS 2008
20 DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC SerCom

The Retail business benefited from a favourable market for games.

Businesses and markets
SerCom Distribution
The Retail business sells to a broad range 
of retailers, e-tailers and catalogue retailers 
in Britain, Ireland and France. The products 
distributed include business software, 
games consoles, software & peripherals, 
consumer electronics, DVDs and audio 
visual accessories. End users are typically 
consumers. Brands include 20th Century 
Fox, Entertainment in Video, Creative Labs, 
Disney, EA, Garmin, Logitech, Microsoft, 
Nintendo, Paramount, Symantec, Take Two, 
Warner and DCC’s own brands, Linx and 
Exspect. 

The Reseller business sells to a broad range 
of resellers and computer dealers in Britain 
and Ireland. The products distributed include 
PCs, servers, printers, peripherals, storage 
and network products and the end users 
are generally small or medium businesses. 
Vendors include Acer, Canon, D-Link, 
Fujitsu Siemens, HP, IBM, Lenovo, Netgear, 
Samsung, Sharp and Sony. 

The Enterprise business sells to value 
added resellers, large account resellers and 
independent software vendors in France, 
Iberia, Benelux, Britain and Ireland. The 
products distributed include a range of 
servers, storage and data management, 
security, storage and virtualisation software 
from a broad range of vendors. End users 
are generally large businesses. Vendors 
include EMC2, HP, IBM, Isilon, Oracle, 
SonicWall, Sun, Symantec and VMware. 

SerCom Solutions
Headquartered in Ireland, SerCom 
Solutions also has operations in 
Poland, the United States and China, 
delivering a range of specialist supply 
chain management services including 
procurement, sourcing, demand 
management, consigned stock 
programmes, contract hardware 
assembly, vendor and end-user fulfilment 
and desktop publishing. The business is 
a strategic supply chain partner for many 
of the world’s leading technology and 
telecommunications companies including 
Apple, Canon, Nortel and Thomson 
Telecom and is working closely with 
SerCom Distribution on the sourcing and 
supply of DCC’s own brand products. 

SerCom Solutions employs state of the art 
IT systems and procurement processes to 
deliver effective supply chain management 
solutions to its customers to allow them to 
constantly lower the cost of components, 
reduce manufacturing lead times, 
minimise inventory and obsolescence and 
to effectively identify and qualify alternative 
sources of products.

Performance management
DCC SerCom is focused on delivering 
sustained profit growth and superior 
returns on capital employed. The 
performance of the business is closely 
monitored through a range of performance 
indicators, including sales growth, gross 
margins, rebate target achievement, 
operational and cost efficiencies, 
operating profit, cash flow and capital 
utilisation. In addition, a range of working 
capital metrics are used to continuously 
monitor and manage the value and profile 
of working capital. 

Over the past ten years, DCC SerCom has 
achieved a compound annual growth rate 
of 9.2% in operating profit.

Performance for the year 
ended 31 March 2008
DCC SerCom achieved excellent operating 
profit growth of 22.9% in the year. The 
operating profit growth on a constant 
currency basis was 24.7%, of which 
organic growth was approximately 13%. 

SerCom Distribution’s Retail focused 
business, comprising Gem, Pilton and 
Banque Magnetique, had an excellent 
year. The business benefited from the 
acquisition of Banque Magnetique and 
a favourable market environment for 
games. The business increased its market 
share with key customers, broadened its 
product portfolio and made significant 
progress developing DCC’s own-brand 
business. 

SerCom Distribution’s Reseller business, 
comprising Micro-P and Sharptext, had 
a disappointing year. Despite increased 
volumes, difficult market conditions and 
ongoing severe price deflation in PCs 
and printers resulted in reduced profits 
for the year. 

SerCom Distribution’s Enterprise business, 
Distrilogie, achieved good profit growth. 
The business grew its market share and 
expanded its product portfolio. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008
DCC - ANNUAL REPORT AND ACCOUNTS 2008

21
21

SerCom Distribution is expanding its product portfolio.  

“ Significant progress 
developing DCC’s  
own-brand 
business.”

Outlook
SerCom Distribution is budgeting for 
another year of strong constant currency 
operating profit growth reflecting the 
development initiatives put in place in 
the last financial year. SerCom Solutions’ 
results will be significantly impacted 
by the loss of a material element of its 
procurement business in Ireland, arising 
from a change in strategy by a major 
customer. Overall, DCC SerCom is 
budgeting for modest constant currency 
growth in operating profits in the current 
financial year. 

The Retail business sells a broad range of products, 
including DCC’s own brands, Linx and Exspect.

SerCom Solutions had an exceptional 
year, reflecting strong growth in demand 
for its supply chain management services. 
During the year, the business commenced 
operations in the United States and 
made good progress in its procurement 
initiatives in the Far East in co-operation 
with SerCom Distribution. 

Strategy and development
DCC SerCom’s strategy is to deliver 
consistent long-term profit growth 
and industry leading returns on capital 
employed. SerCom Distribution will 
continue to pursue its aims of expanding 
its customer and product portfolios, with a 
particular focus on the retail and enterprise 
markets and on deriving maximum 
synergies from the recent acquisition of 
Banque Magnetique. SerCom Solutions 
will continue to extend its world class 
procurement and sourcing services in the 
Americas and the Far East as well as its 
existing operations in Poland. 

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Managing Director

“ SerCom Solutions 
employs state of the art IT 
systems and procurement 
processes.”

Operating profit (€m)

10 Year CAGR 9.2%
5 Year CAGR 4.1%

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22

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Healthcare

DCC Healthcare is a broadly based healthcare products and services group with operations 
encompassing:

• 

 Procurement, sales and marketing of healthcare products and provision of related services to 
hospitals in Ireland and Britain;

•  Provision of outsourced services to the health and beauty sector in Britain and continental Europe.

• 

 Procurement, sales and marketing of rehabilitation products in Britain, Ireland, Germany, Australia, 
New Zealand and other markets.

DCC Healthcare currently employs approximately 1,300 people. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008
23

DCC - ANNUAL REPORT AND ACCOUNTS 2008

23

Revenue

€286.8m

Operating profit

€23.5m

Revenue 
Operating profit 
Operating margin 
Return on capital employed
- excluding intangible assets 
- including intangible assets 

  Change on prior year
  Constant 
2007  Reported  Currency

€234.3m 
€22.5m 
9.6% 

+22.4% 
+4.2% 

+24.5%
+5.6%

2008 

€286.8m 
€23.5m 
8.2% 

48.8% 
13.9% 

57.3%
15.6% 

 
 
 
 
 
 
 
 
 
24 DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Healthcare

DCC now has a strong growth platform, providing distribution services to British hospitals.

Businesses and markets 
DCC Healthcare has three areas of 
activity: 

Acute care - Fannin is the market leader 
in acute care in Ireland. Fannin’s product 
portfolio encompasses intravenous 
pharmaceuticals, medical, surgical and 
laboratory products. The business markets 
and sells a broad range of leading brands 
including Cardinal, Grifols, Molnlycke, Oxoid 
and Synthes through its extensive field sales 
force of over 100 highly trained professionals. 
DCC is focusing on developing value-added 
services related to this product offering. In 
Ireland, Fannin has built a growing business 
in pharmaceutical compounding services for 
Irish hospitals. 

DCC now has a strong growth platform in the 
provision of value added distribution services 
to British hospitals and leading healthcare 
brand owners. This is a developing sector 
as British hospitals increasingly look for 
customised just-in-time distribution solutions 
to deliver cost savings, free up hospital 
space, improve product availability and 
ultimately contribute to delivering better 
service levels to their patients. Fannin 
also has a developing specialist sales and 
marketing business in Britain that is currently 
focused on intravenous pharmaceuticals and 
surgical devices.

DCC Health & Beauty Solutions is a leading 
provider of “source to shelf” outsourced 
solutions to the health and beauty industry, 
principally in the areas of nutraceuticals 
(vitamin and health supplements), skin care 
and hair care. DCC provides a wide range 
of product formats (tablets, soft and hard 

gel capsules, creams and liquids), packing 
and other services from its three MHRA 
licensed facilities in Britain. The quality of 
these facilities, together with the strength 
and depth of DCC’s business development 
and technical resources, means that DCC 
offers customers a rapid turnaround from 
marketing concept through to finished, 
shelf-ready product. This process typically 
involves product development, formulation, 
stability and other testing and regulatory 
compliance, as well as manufacturing and 
packing. DCC’s key strength is the highly 
responsive and flexible service it provides to 
its customer base of leading premium brand 
owners, mail order companies, specialist 
health and beauty retailers and private label 
suppliers in Britain, continental Europe and 
other markets. 

DCC Mobility & Rehab is a developing 
international mobility and rehabilitation 
business, with operations in Britain, Ireland, 
Germany, Australia and New Zealand, 
as well as a network of international 
distributors. DCC is the market leader in 
the physiotherapy product sector in Britain, 
Australia and New Zealand, distributing 
a broad product portfolio including 
physiotherapy equipment and consumables 
and general rehabilitation equipment 
principally marketed under its own Days 
Healthcare, Physio-Med and Metron brands. 

Products are developed and designed in-
house with manufacturing outsourced, mainly 
to Asian and eastern European partners. 
DCC’s procurement and quality control team 
based in Shenzhen, China works closely with 
these partners. DCC’s extensive customer 
base – hospitals, community loan stores, 

specialist retailers, private practitioners, 
nursing homes, end users and distributors 
– is serviced through field and telesales 
teams and supported by product catalogues 
and websites.

Performance management
DCC Healthcare’s business is constantly 
monitored through a broad range of 
performance indicators, principally 
focused on sales growth, margin 
management, operational and cost 
efficiencies, cash flow and return on 
capital employed. 

Over the past ten years DCC Healthcare 
has achieved a compound annual growth 
rate of 13.2% in operating profit. 

Performance for the year 
ended 31 March 2008
DCC Healthcare achieved strong profit 
growth in both the acute care and mobility 
and rehabilitation sectors, but overall 
profit growth was moderated to 4.2% by 
a weaker performance in DCC Health & 
Beauty Solutions. The operating profit 
growth on a constant currency basis was 
5.6%, driven by acquisition contribution 
and a modest organic decline. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

25

DCC is the market leader in physiotherapy products in 
Britain, Australia and New Zealand.

“ Market leader in  
the acute care 
sector in Ireland.”

Strategy and development
DCC Healthcare’s strategy is to build 
a substantial international healthcare 
products and services business. The 
primary focus is on the generation of 
strong organic profit growth and superior 
returns in its existing businesses. DCC 
Healthcare is continually developing 
and expanding its product and service 
offerings and driving growth through its 
existing channels to market. The business 
is also focused on growing in new and 
developing channels, leveraging its 
extensive sales teams, catalogues and 
websites.

DCC Healthcare has an active acquisition 
programme and is particularly targeting 
acquisitions in the acute care and health 
and beauty sectors. Geographically, DCC 
Healthcare’s acquisition activity is primarily 
focused on Britain and continental Europe. 

Outlook
DCC Healthcare is budgeting to achieve 
excellent constant currency operating 
profit growth in the current financial year.

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Managing Director

“ DCC offers its customers 
a rapid turnaround from 
marketing concept through 
to finished, shelf-ready 
product.” 

Operating profit (€m)

10 Year CAGR 13.2%
5 Year CAGR 17.3%

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Fannin has built a growing business in pharmaceutical 
compounding services for Irish hospitals.

DCC’s acute care business, Fannin, made 
good progress during the year generating 
strong profit growth and significantly 
expanding its position in Britain through 
the acquisitions of Squadron Medical 
and a complementary business 
based in Scotland. In Ireland, Fannin 
achieved strong growth in intravenous 
pharmaceuticals through excellent organic 
growth in its sales and marketing activities 
and its pharma compounding services. 

DCC Health and Beauty Solutions 
achieved good sales growth but profits 
were impacted by increased costs arising 
from planned capacity expansion and 
new product development on behalf of 
customers. 

DCC Mobility & Rehab generated excellent 
organic profit growth in physiotherapy 
supplies in Britain, further strengthening 
its leadership in this market. Sales of 
general rehabilitation products in Britain 
also showed good growth, while Germany 
was impacted by weak market conditions. 
Ausmedic broadened its product range 
and market coverage in Australia through 
the launch of the DCC Mobility & Rehab 
product range. 

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26

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Food & Beverage

DCC Food & Beverage markets and sells a wide range of company owned and agency branded 
food and beverage products in Ireland and has a wine business in Britain. It is a market leader 
in a number of niche market segments in healthfoods, indulgence foods and frozen & chilled 
logistics. 

DCC Food & Beverage currently employs approximately 1,060 people.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

27

Revenue

€310.1m

Operating profit

€15.3m

Revenue 
Operating profit 
Operating margin 
Return on capital employed
- excluding intangible assets 
- including intangible assets 

  Change on prior year
  Constant 
2007  Reported  Currency

€279.5m 
€15.1m 
5.4% 

+11.0% 
+1.6% 

+11.7%
+1.7%

2008 

€310.1m 
€15.3m 
4.9% 

51.2% 
18.6% 

51.7%
18.3%

 
 
 
 
 
 
 
 
28

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Food & Beverage

Robert Roberts is the No.2 supplier of freshly ground coffee and a leading supplier of confectionery in Ireland.

two supplier of savoury snacks (through 
the KP range), a leading independent 
distributor of confectionery products and 
has a strong position in wine distribution 
through Woodford Bourne. In Britain, 
Bottle Green is a leading supplier of 
branded and exclusive label solutions to 
the multiple off-trade sector of the UK 
wine market. 

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controlled supply chain solutions 
(procurement, brand management, 
warehousing and distribution), to major 
retailers, manufacturers and food service 
customers.

Kylemore Foods Group (50% owned 
by DCC) is a leading player in retail 
restaurants and contract catering in 
Ireland.

Performance management
DCC Food & Beverage’s operating 
performance is managed and monitored 
through a number of key performance 
indicators. These include sales volumes, 
market share, gross margins, operational 
cost efficiencies, customer service levels, 
cash flow and return on capital employed. 

Over the past ten years, DCC Food & 
Beverage has achieved a compound 
annual growth rate of 11.9% in operating 
profit.

Businesses and markets
DCC Food & Beverage has a strong track 
record in brand building and offers deep 
distribution reach with extensive customer 
service to the retail and foodservice 
sectors throughout Ireland. Customers 
include multiples, symbol and independent 
retailers, pharmacies, off-licences, hotels, 
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Healthfoods
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comprehensive supplier of owned and 
agency brands of healthy foods and 
beverages, fine foods and vitamins, 
minerals and supplements (“VMS”), 
selling directly to both the grocery and 
pharmacy sectors. Kelkin is recognised 
as the leading brand in the health / “better 
for you” food sector and offers a healthy 
choice in many food categories. It is also a 
strong brand in the VMS sector. 

Indulgence foods
Robert Roberts is a value-added 
distributor of indulgent products in 
the grocery, impulse and food service 
sectors. The business has a strong 
complementary range of owned and 
agency brands, specialising in snacks, 
hot beverages, wine, confectionery, 
soft drinks and cakes. Robert Roberts 
provides a top-class service in marketing, 
category management, selling (key 
account management, direct sales 
representatives and van sales), distribution 
and merchandising. In the Irish market, 
Robert Roberts is the number two supplier 
of freshly ground coffee to both the retail 
and foodservice sectors, the number 

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Operating profit (€m)

10 Year CAGR 11.9%
5 Year CAGR 10.4%

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DCC - ANNUAL REPORT AND ACCOUNTS 2008

29

Kelkin supplies a range of gluten free products.

Robert Roberts has a complementary 
range of owned and agency brands.

“ DCC’s businesses 
have a strong track 
record in brand 
building.”

DCC Food & Beverage aims to deliver 
acquisitions in Ireland and Britain that 
will exploit the growing demand for 
healthy food and beverage products and 
strengthen existing market positions.

Outlook
DCC Food & Beverage is budgeting for 
modest constant currency operating profit 
growth in the current financial year. 

Frank Fenn
Managing Director

“ Kelkin is recognised as  
the leading brand in the  
health / “better for you”  
food sector.”

Performance for the year 
ended 31 March 2008
DCC Food & Beverage achieved 
modest growth of 1.6% in the year. On 
a constant currency basis the operating 
profit growth was 1.7% (all organic). In 
Ireland, good growth was achieved in 
healthfoods, principally driven by the 
increased investment in the Kelkin brand, 
new product development and growth in 
agency brands. Very good growth was 
also achieved in indulgence foods across 
its core categories.

The frozen and chilled logistics business 
was impacted by the start up costs of a 
significant new contract and associated 
investment in new facilities. Kylemore 
Foods Group, in which DCC has a 50% 
joint venture shareholding, significantly 
enhanced shareholder value over the past 
year. 

Strategy and development 
DCC’s strategy is to develop DCC Food 
& Beverage into a leading business that 
satisfies consumer and customer needs 
in the health and indulgence sectors 
and delivers an above average return on 
capital. This will be achieved by building 
organically and by acquisition. 

The business will continue to focus on 
building its brands, with the growing Kelkin 
brand well-placed to take advantage of 
the expanding healthfoods market.

 
30

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Environmental

DCC Environmental provides a broad range of waste management and recycling services to the 
industrial, commercial, construction and public sectors in Britain and Ireland. Through its 50% 
shareholding in William Tracey and its subsidiary Wastecycle, DCC Environmental has built a 
significant position in the British waste management and recycling industry. DCC Environmental’s 
subsidiary, Enva, is the leading hazardous waste treatment business in Ireland. 

DCC Environmental currently employs approximately 550 people.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

31

Revenue

€91.7m

Operating profit

€14.0m

Revenue 
Operating profit 
Operating margin 
Return on capital employed
- excluding intangible assets 
- including intangible assets 

  Change on prior year
  Constant 
2007  Reported  Currency

€66.5m 
€10.4m 
15.7% 

+37.9% 
+34.4% 

+41.0%
+37.6%

2008 

€91.7m 
€14.0m 
15.3% 

40.4% 
17.4% 

38.5%
17.9% 

 
 
 
 
 
 
 
 
 
32

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Business Review
DCC Environmental

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Wastecycle provides a comprehensive waste recycling service to industrial, commercial & local authority customers.

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Operating profit (€m)

9 Year CAGR 79.1%
5 Year CAGR 33.3%

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Businesses and markets
Britain

Driven by increasing legislation and 
taxation, Britain is seeking to aggressively 
reduce the amount of waste going to 
landfill and to bring waste management 
in line with best practice in continental 
Europe. This is effected by increased rates 
of recycling and the introduction of new 
innovative waste treatment processes. 
There have been two significant 
government interventions in the last year. 
Firstly, new regulations came into effect 
in October 2007 which require all waste 
to be treated in advance of disposal 
to landfill. Secondly, with effect from 1 
April 2008, landfill tax increased from its 
previous £24 per tonne to £32 per tonne 
and will rise to £40 per tonne on 1 April 
2009 and £48 per tonne by 1 April 2010. 
Both these initiatives give further impetus 
to DCC’s strategy to become a leading 
player in the British waste management 
and recycling industry. 

Both William Tracey’s and Wastecycle’s 
focus is on the industrial, commercial 
and construction waste segments of 
the market, while also handling waste 
on behalf of some local authorities. 
Combined, these businesses handle in 
excess of one million tonnes of waste 
using 146 vehicles. 

Operating from eight freehold sites, 
William Tracey is recognised as Scotland’s 
leading waste management and 
recycling company with a reputation for 
innovation and creativity in the recycling 
and management of a wide range of 
waste products. The business operates 
a number of fully integrated facilities to 

treat, recover and dispose of waste, 
including the manufacture of recycled 
products. William Tracey has an extensive 
fleet of specialist waste management 
vehicles that collect from industrial and 
commercial customers while the business 
also processes waste on behalf of local 
authorities and other third parties. 

Wastecycle is a leading recycling and 
waste management company based in 
Nottingham, England. Operating from 
a ten acre site, the company provides 
a comprehensive waste collection and 
recycling service to industrial, commercial 
and local authority customers. Through 
some of the most innovative techniques 
in the industry, using both automated 
and semi automated equipment, 
Wastecycle separates waste and recovers 
a range of recyclable material such as 
cardboard, metals, timber, plastics, paper, 
aggregates, soils, glass and plasterboard. 

Ireland

Enva is the leading hazardous waste 
treatment business in Ireland. Operating 
from six licensed sites, the business 
offers a wide range of services including 
soil remediation, oil recycling, chemical 
treatment, water treatment and metal 
recovery. With the most comprehensive 
hazardous waste infrastructure in Ireland, 
Enva is ideally positioned to work with 
the Irish regulators, in particular the 
Environmental Protection Agency (EPA) 
in its goal of national self sufficiency in 
dealing with hazardous waste as most 
recently articulated in its Proposed 
National Hazardous Waste Management 
Plan 2008 – 2012. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

33

Enva offers a range of services, including soil remediation, oil 
recycling, chemical treatment and metal recovery.

“ Increased rates 
of recycling and 
introduction 
of innovative 
waste treatment 
processes.”

Both William Tracey and Wastecycle have 
benefited from a focus on the continuous 
increase in the proportion of waste 
recycled.  

Enva achieved modest profit growth in 
the year. 

Strategy and development
DCC’s strategy is to grow its position as a 
leading broadly based waste management 
and recycling business in Britain and 
Ireland. In particular, DCC aims to position 
the business to take advantage of the 
trend towards more sustainable waste 
management with a particular emphasis on 
recycling. This growth strategy will be driven 
both organically and by acquisition.

Outlook
DCC Environmental is well positioned within 
attractive growth markets and is budgeting 
for excellent constant currency operating 
profit growth in the current financial year. 

Tommy Breen 
Managing Director

“ In Britain, DCC 
Environmental handles 
in excess of one million 
tonnes of waste using 146 
vehicles.”

William Tracey has a reputation for innovation and 
creativity in the recycling and management of a wide 
range of waste products.

Performance management
DCC Environmental is focused on 
maximising shareholders’ returns 
through organic and acquisition growth. 
The performance of the business is 
closely monitored through a range of 
key indicators including sales volumes, 
incoming material tonnage, recycling 
targets, gross margins, costs of treatment, 
operating profit, cash flow and capital 
utilisation. DCC gives the highest priority 
to its health, safety and environmental 
record through the allocation of 
appropriate resources and implementation 
of best practice. A range of measurement 
tools, including lost time incident rates, are 
used to monitor performance. 

Over the 9 years since the business was 
established, DCC Environmental has 
achieved a compound annual growth rate 
of 79.1% in operating profit. 

Performance for the year 
ended 31 March 2008
DCC Environmental achieved excellent 
profit growth of 34.4%. The operating 
profit growth on a constant currency basis 
was 37.6%, of which organic growth was 
approximately 18%. 

William Tracey recorded excellent organic 
growth and has continued to build on 
its position as Scotland’s leading waste 
management and recycling business. 

Wastecycle also achieved excellent 
organic profit growth across all parts of its 
business. 

34

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Financial Review

Fergal O’Dwyer 
Chief Financial Officer

Balanced business model
DCC’s balanced business model delivered 
an excellent performance against a 
backdrop of more challenging economic 
conditions in the geographic markets in 
which it operates. On a constant currency 
basis, operating profit grew by 21.8% 
(19.3% on a reported basis). 

Accounting policies
The Group financial statements have been 
prepared in accordance with International 
Financial Reporting Standards (IFRS) 
as adopted by the European Union and 
their interpretations as issued by the 
International Accounting Standards Board 
(IASB) and the International Financial 
Reporting Interpretations Committee 
(IFRIC), applicable Irish law and the 
Listing Rules of the Irish and London 
Stock Exchanges. Details of the basis of 
preparation and the significant accounting 
policies of the Group are included in pages 
63 to 71.

Overview of results/key 
performance indicators
Revenue of €5.5 billion grew by 39.9% 
on a constant currency basis (36.7% on 
a reported basis) and operating profit of 
€167.2 million increased by 21.8% on 
a constant currency basis (19.3% on a 
reported basis) as set out in Tables 1  
and 2. 

Growth in revenue and operating profit, 
analysed as between organic growth, 
growth from acquisitions and the impact 
of currency, is as follows:

Revenue  Operating 
Profit
%

% 

18.9% 

21.0% 

39.9% 

8.3%

13.5%

21.8%

(3.2%) 

(2.5%)

36.7% 

19.3%

Organic 

Acquisitions 

Constant currency 

Currency impact  
on translation 

Reported 

Although DCC’s operating margin 
(excluding exceptionals) was 3.0% (3.5% 
in 2007), it is important to note that this 
measurement of the overall Group margin 
is of limited relevance due to the influence 
of changes in oil product costs.

While changes in oil product costs will 
change percentage operating margins, 
this has little relevance in the downstream 
energy market in which DCC Energy 
operates where profitability is driven by 
absolute contribution per litre (or tonne) 
of product sold and not by a percentage 
margin. Excluding DCC Energy, the 
Group’s operating margin was 4.4% 
compared to 4.5% in the previous year. 

A detailed review of the operating 
performance of each of DCC’s divisions is 
set out on pages 14 to 33.

Table 1: Revenue - constant currency

2008 

2007 

Change

H1 
€’m 

H2 
€’m 

FY 
€’m 

H1 
€’m 

H2 
€’m 

FY 
€’m 

H1 
% 

H2 
% 

FY
%

  DCC Energy 

1,326.7 

2,191.0 

3,517.7 

996.3  1,251.5 

2,247.8  +33.2%  +75.1%  +56.5%

  DCC SerCom 

571.1 

876.0 

1,447.1 

529.2 

688.8 

1,218.0 

+7.9%  +27.2%  +18.8%

  DCC Healthcare 

131.3 

160.4 

291.7 

112.2 

122.1 

234.3  +17.1%  +31.3%  +24.5%

  DCC Food & Beverage 

161.0 

151.3 

312.3 

136.5 

143.0 

279.5  +18.0% 

+5.8%  +11.7%

  DCC Environmental 

45.4 

48.3 

93.7 

29.1 

37.4 

66.5  +55.9%  +29.4%  +41.0%

  Total 

2,235.5 

3,427.0 

5,662.5 

1,803.3  2,242.8 

4,046.1  +24.0%  +52.8%  +39.9%

 
 
 
 
 
 
 
 
 
Financial Review (continued)

“Profit before tax of €181.7 
million increased by 14.2% on 
a constant currency basis. On 
a reported basis the increase 
was 12.3%”

DCC - ANNUAL REPORT AND ACCOUNTS 2008

35

Finance costs (net)
Net finance costs for the year increased by 
€6.9 million to €17.8 million (€10.9 million 
in 2007), primarily due to an increase in 
interest rates. There was a slight increase 
in the Group’s net debt levels which 
averaged €242 million during the year 
compared to €233 million in the prior year. 
Interest was covered 9.4 times by Group 
operating profit before amortisation of 
intangible assets (12.9 times in 2007).

Exceptional profit (net)
As DCC announced on 19 December 
2007, the dividend received from Manor 
Park Homebuilders and the subsequent 
sale of the shareholding gave rise to a 
profit on cost of €180 million and an 
exceptional profit on carrying value of 
€94.7 million. This exceptional profit, less 
the exceptional charge of €50 million for 
the settlement and costs of the Fyffes 
action, announced on 14 April 2008, and 
other net exceptional charges of  
€5.1 million, resulted in a net exceptional 
profit before tax in the year of  
€39.6 million.

The tax charge relating to the net 
exceptional profit was €1.8 million.

Amortisation of intangible assets
The charge for the amortisation of 
intangible assets increased from  
€6.7 million to €7.9 million as a result of 
the amortisation of intangible assets arising 
on acquisitions completed during the year 
ended 31 March 2008 and a full year’s 
amortisation charge relating to intangible 
assets acquired on acquisitions completed 
in the previous year.

Profit before tax
Profit before tax of €181.7 million 
increased by 14.2% on a constant 
currency basis. On a reported basis the 
increase was 12.3%.

Taxation
Excluding the tax charge of €1.8 million 
on the net exceptional profit and a 
taxation credit of €1.7 million in relation 
to the amortisation of intangible assets, 
the effective tax rate for the Group was 
11.0%, the same as in the prior year.

Adjusted earnings per share excluding 
Manor Park Homebuilders contribution
As DCC’s 49% shareholding in Manor 
Park Homebuilders was disposed of 
during the year ended 31 March 2008, 
adjusted earnings per share excluding 
the contribution from Manor Park 
Homebuilders has been shown separately 
to disclose the underlying earnings growth 
of 15.0% achieved in DCC’s managed and 
controlled subsidiaries and joint ventures. 
On a constant currency basis the growth 
rate was 17.4%.

The compound annual growth rate in 
DCC’s adjusted earnings per share 
(excluding the contribution from Manor 
Park Homebuilders) over the last 15, 10 
and 5 years is as follows;

15 years (i.e. since 1993) 
10 years (i.e. since 1998) 
5 years (i.e. since 2003) 

CAGR %

15.2%
14.0%
10.2%

Table 2: Operating profit - constant currency

2008 

2007 

Change

H1 
€’m 

H2 
€’m 

FY 
€’m 

H1 
€’m 

H2 
€’m 

FY 
€’m 

H1 
% 

H2 
% 

FY
%

  DCC Energy 

14.3 

62.2 

76.5 

11.7 

47.8 

59.5  +22.4%  +30.1%  +28.6%

  DCC SerCom 

12.4 

28.3 

40.7 

10.5 

22.1 

32.6  +18.0%  +27.9%  +24.7%

  DCC Healthcare 

10.3 

13.4 

23.7 

9.8 

12.7 

22.5 

+5.9% 

+5.4% 

+5.6%

  DCC Food & Beverage 

  DCC Environmental 

7.0 

7.2 

8.3 

7.2 

15.3 

14.4 

7.3 

4.6 

7.8 

15.1 

-4.4% 

+7.5% 

+1.7%

5.8 

10.4  +54.9%  +23.8%  +37.6%

  Total 

51.2 

119.4 

170.6 

43.9 

96.2 

140.1  +16.7%  +24.1%  +21.8%

 
 
 
 
 
 
 
 
 
 
 
36

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Financial Review
(continued)

Dividend
The total dividend for the year of 56.67 
cent per share represents an increase of 
15% over the previous year. The dividend 
is covered 2.9 times (3.2 times in 2007) by 
adjusted earnings per share. Over the last 
10 years DCC’s dividend has grown at a 
compound annual rate of 16.6%.

Return on capital employed
The creation of shareholder value through 
the delivery of consistent, long-term 
returns in excess of cost of capital is 
one of DCC’s core strengths. Although 
marginally lower than the previous year, 
DCC again achieved excellent returns on 
capital employed (as detailed in Table 3), 
generating a return of 38.0% excluding 
intangible assets and 17.5% including 
intangible assets (38.9% and 17.9% 
respectively in 2007). 

DCC’s return on capital employed has 
remained consistently high through a 
combination of good organic growth, 
attractive acquisition valuations and 
excellent integration synergies. 

Cash flow
A summary of DCC’s cashflow is set out 
in Table 4. 

DCC focuses on operating cash flow 
to maximise shareholder value over 
the long term. Operating cash flow is 
principally used to fund investment in 
existing operations, complementary bolt-
on acquisitions, dividend payments and 
selective share buybacks. 

DCC generated cash flow from operations 
of €129.0 million which was marginally 
higher then the €127.4 million generated 
in the prior year. Operating cash flow in the 
year was held back due to an increased 
investment requirement in working capital 
of €84.4 million, driven by the strong 
growth (36.7%) in revenue and an increase 
in working capital days at 31 March 2008 
to 16.4 days revenue compared to 14.0 
days at 31 March 2007 as detailed in 
Table 5. 

DCC Energy had an increased investment 
in working capital of €101.6 million as 
a result of the higher price of oil. DCC 
SerCom’s working capital levels, which 
had been relatively high at the end of 
the previous year, reduced by €20.5 
million. During the year the Group received 
dividends of €172.0 million from Manor Park 
Homebuilders. In addition the disposal of the 
Group’s 49% interest in that company gave 
rise to a receipt of €8.9 million.

Including the net €84.4 million investment 
in working capital referred to above, 
acquisition and organic development 
expenditure amounted to €351.6 million. 
DCC’s ongoing acquisition programme 
resulted in a number of acquisitions 
being completed during the year at a 
total committed cost of €179.6 million, of 
which €13.0 million was deferred. 

The cash impact of acquisitions in the 
year was €176.6 million when payments 
of deferred acquisition consideration of 
€10.0 million are taken into account. 
Capital expenditure was €87.6 million. Net 
of fixed asset disposals the cash outflow 
from capital expenditure was €79.7 
million.

Balance sheet and group 
financing
DCC has a strong balance sheet with total 
equity of €742.4 million at 31 March 2008 
and net debt at the same date of €123.7 
million. Net debt as a percentage of total 
equity was 16.7% compared to 14.6% 
at 31 March 2007. The composition of 
net debt at 31 March 2008 and 2007 
is analysed in Table 6. An analysis of 
DCC’s cash, debt and financial derivative 
instrument balances at 31 March 2008, 
including maturity periods and currency 
and interest rate profiles, is set out in 
Notes 27 to 30 to the financial statements.

Table 3: Return on capital employed

2008 

2007

ROCE 
(excl intangible assets) 

ROCE 
(incl intangible assets) 

ROCE 
(excl intangible assets) 

ROCE
(incl intangible assets)

  DCC Energy 

  DCC SerCom 

  DCC Healthcare 

  DCC Food & Beverage 

  DCC Environmental 

  Group 

45.8% 

24.2% 

48.8% 

51.2% 

40.4% 

38.0% 

20.6% 

15.3% 

13.9% 

18.6% 

17.4% 

17.5% 

49.9.% 

22.4% 

57.3% 

51.7% 

38.5% 

38.9% 

22.7%

13.8%

15.6%

18.3%

17.9%

17.9%

 
 
 
Financial Review (continued)

“The total dividend for the 
year of 56.67 cent per share 
represents an increase of  
15% over the previous year.”

DCC - ANNUAL REPORT AND ACCOUNTS 2008

37

Table 4: Summary of cash flows 

Inflows
Cash generated from operations 
Dividend received from associate 
Proceeds on disposal of associate 
Share issues (net) 

Outflows
Capital expenditure (net) 
Acquisitions 
Share buyback 
Interest and tax paid 
Dividend paid 
Net exceptionals  

Net cash outflow 
Translation adjustments and other 
Net debt at start of year 

2008 
€’m 

129.0 
172.0 
8.9 
4.1 
314.0 

79.7 
176.6 
- 
36.9 
44.5 
4.2 
341.9 

(27.9) 
4.7 
(100.5) 

2007
€’m

127.4
-
-
6.1
133.5

16.2
105.7
18.8
19.2
36.4
4.9
(201.2)

(67.7)
(0.1)
(32.7)

Net debt at end of year 

(123.7) 

(100.5)

Table 5: Working capital days 

Stocks 
Debtors 
Creditors 
Share issues (net) 

Table 6: Analysis of net debt 

Non-current assets:
Derivative financial instruments 

Current assets:
Derivative financial instruments 
Cash and cash equivalents 

Non-current liabilities:
Borrowings  
Derivative financial instruments 
Unsecured Notes due 2008 to 2019 

Current liabilities:
Borrowings 
Derivative financial instruments 

Net debt 

2008 
Days 

12.4 
45.7 
(41.7) 
16.4 

2007
Days

13.7
45.3
(45.0)
14.0

2008 
€’m 

2007
€’m

25.4 

3.1

1.5 
485.8 
487.3 

(4.5) 
(43.6) 
(353.6) 
(401.7) 

(217.5) 
(17.2) 
(234.7) 

(123.7) 

0.1
337.0
337.1

(3.1)
(45.9)
(265.5)
(314.5)

(126.0)
(0.2)
(126.2)

(100.5)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
38

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Financial Review
(continued)

“Group financial risk 
management is governed by 
policies and guidelines which 
are reviewed and approved 
annually by the Board of 
Directors.” 

Financial risk management
Group financial risk management is 
governed by policies and guidelines which 
are reviewed and approved annually by 
the Board of Directors. These policies and 
guidelines primarily cover foreign exchange 
risk, commodity price risk, credit risk, 
liquidity risk and interest rate risk. The 
principal objective of these policies and 
guidelines is the minimisation of financial 
risk at reasonable cost. 

The Group does not trade in financial 
instruments nor does it enter into any 
leveraged derivative transactions. 
DCC’s Group Treasury function centrally 
manages the Group’s funding and liquidity 
requirements. Divisional and subsidiary 
management, in conjunction with Group 
Treasury, manage foreign exchange 
and commodity price exposures within 
approved policies and guidelines. Further 
detail in relation to the Group’s financial risk 
management and its derivative financial 
instrument position is contained in Note 47 
to the financial statements.

Foreign exchange risk 
management
DCC’s reporting currency and that in 
which its share capital is denominated is 
the euro. Exposures to other currencies, 
principally sterling and the US dollar, arise 
in the course of ordinary trading. 

In the second half of the year sterling 
weakened significantly and this impacted 
on reported profits as approximately 60% 
of the Group’s operating profit for the year 
ended 31 March 2008 was denominated 
in sterling. The sterling:euro exchange 
rate weakened by 17.0% from 0.6795 at 
31 March 2007 to 0.7953 at 31 March 
2008. The average rate at which the Group 
translates its UK operating profit declined 
by 3.3% from 0.6797 in 2007 to 0.7021 in 
2008.

That portion of the DCC’s operating profits 
that are sterling denominated are offset 
to a limited degree by certain natural 
economic hedges that exist within the 
Group, for example, a proportion of the 
purchases by certain of its Irish businesses 
are sterling denominated. DCC does not 
hedge the remaining translation exposure 
on the translation of the profits of foreign 
currency subsidiaries on the basis and to 
the extent that they are not intended to 
be repatriated. The 3.3% reduction in the 
average translation rate of sterling, referred 
to above, adversely impacted the Group’s 
reported operating profit by €3.4 million 
(2.5%) in the year ended 31 March 2008.

DCC has investments in sterling operations 
which are highly cash generative. The 
Group seeks to manage the resultant 
foreign currency translation risk through 
borrowings denominated in or swapped 
(utilising currency swaps or cross currency 
interest rate swaps) into sterling, although 
this hedge is offset by the strong ongoing 
cash flow generated from the Group’s 
sterling operations leaving DCC with a net 
investment in sterling assets. 

The 17% reduction in the value of sterling 
against the euro during the year ended 31 
March 2008, referred to above, gave rise 
to a translation loss of €64.3 million on the 
translation of DCC’s sterling denominated 
net asset position at 31 March 2008 as 
set out in the reconciliation of the Group’s 
Total Equity in note 41 to the financial 
statements. €16.0 million of this amount 
related to DCC’s sterling denominated 
intangible assets.

Where sales or purchases are invoiced 
in other then the local currency and 
there is not a natural hedge with other 
activities within the Group, DCC generally 
hedges between 50% and 90% of those 
transactions for the subsequent two 
months. 

 
Financial Review (continued)

“DCC maintains a strong 
balance sheet with long-
term debt funding and 
cash balances with deposit 
maturities up to six months”

DCC - ANNUAL REPORT AND ACCOUNTS 2008

39

Commodity price risk 
management
DCC is exposed to commodity price risk 
in its LPG and oil distribution businesses. 
The Group generally hedges approximately 
50% of its anticipated LPG commodity 
price exposure for the subsequent month, 
with such transactions qualifying as 
‘highly probable’ forecast transactions 
for IAS 39 hedge accounting purposes. 
Certain customers occasionally require 
fixed price oil supply contracts generally 
for periods of less than six months. In 
such circumstances, DCC enters into 
matching forward commodity contracts, 
not designated as hedges under IAS 39. 
All commodity hedging counterparties are 
approved by the Board.

Credit risk management
DCC transacts with a variety of high credit 
rated financial institutions for the purpose 
of placing deposits and entering into 
derivative contracts. The Group actively 
monitors its credit exposure to each 
counterparty to ensure compliance with 
limits approved by the Board.

Interest rate risk and debt/
liquidity management
DCC maintains a strong balance sheet 
with long-term debt funding and cash 
balances with deposit maturities up 
to six months. In addition, the Group 
maintains significant uncommitted credit 
lines with its relationship banks. DCC 
borrows at both fixed and floating rates 
of interest. It has swapped its fixed rate 
borrowings to floating interest rates, using 
interest rate and cross currency interest 
rate swaps which qualify for fair value 
hedge accounting under IAS 39. The 
Group mitigates interest rate risk on its 
borrowings by matching, to the extent 
possible, the maturity of its cash balances 
with the interest rate reset periods on the 
swaps related to its borrowings. 

Summary
As the key financial performance indicators 
set out in Table 7 show, the Group 
performed strongly in 2008 delivering an 
improvement in revenues and operating 
profits and excellent returns on capital 
employed. Despite total development 
expenditure of €351.1 million on 
working capital, capital expenditure and 
acquisitions, DCC ended the year with a 
conservatively geared balance sheet. This 
will facilitate the Group in its development 
plans, both organic and by way of 
acquisitions.

Table 7: Key Financial performance indicators

Revenue growth 

Operating profit growth* 

Interest cover (times) 

Net debt as a percentage of total equity 

Working capital as a percentage of total revenue 

Working capital - days 

Return on capital employed 

- Excluding intangible assets 

- Including intangible assets 

*excluding exceptionals and amortisation of intangible assets.

2008 

2007

36.7% 

19.3% 

9.4 

17.7%

15.7%

12.9

16.7% 

14.6%

5.2% 

16.4 

4.5%

14.0

38.0% 

17.5% 

38.9%

17.9%

 
 
 
 
 
40

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Corporate Social Responsibility

Corporate social responsibility (CSR) is 
embedded in DCC’s core beliefs and 
values. DCC recognises its responsibilities 
to all stakeholders, including shareholders, 
employees, customers, suppliers and the 
community at large, and is fully committed 
to the management of all aspects of its 
business to the highest standards in order 
to fulfil these responsibilities.

Workplace
With approximately 7,000 employees 
working in 16 countries within our 5 
industry sectors, DCC’s employees’ 
knowledge, skills, experience and 
commitment to excellence are of vital 
importance to the success of the Group. 
Indeed our decentralised model, which 
affords a high degree of autonomy to our 
operating subsidiaries, depends on the 
strength and capability of our employees. 

Training and development
We appreciate the need to ensure that 
our employees’ knowledge and skill 
base is constantly being developed 
and challenged and we bring focus and 
commitment to employee training and 
development initiatives throughout the 
Group.

Training focuses mainly on technical, job 
specific, health & safety and leadership/ 
management training. In addition to 
these training initiatives, there are 
ongoing development programmes 
for team leaders, supervisors and 
managers, including residential 
leadership development programmes 
for those employees who display senior 
management potential. DCC Group 
companies also support employees 
who wish to pursue further study and 
development.

Communication
DCC’s subsidiaries strive to ensure 
that they have excellent employee 
communication processes which include 
employee committees, focus groups, 
newsletters and suggestion schemes. 

Marketplace
Products and services
DCC’s commitment to enhancing the 
lives of its stakeholders is reflected in the 
design, delivery and management of its 
products and services.

In the Energy division, Flogas distributes 
LPG, which is a non-toxic, clean burning, 
sulphur and smoke free fuel. 

In the Healthcare division, the Mobility & 
Rehab businesses provide rehabilitation 
and physiotherapy products that assist 
users in leading independent lives. 

In the Food & Beverage sector, Robert 
Roberts markets a range of Fairtrade 
products including tea, coffee, fruit juices 
and wine. Kelkin actively provides a range 
of “better for you” and healthy products 
under its own brand which are free 
from all artificial colouring, preservatives 
and flavourings. Kelkin also markets 
a comprehensive range of gluten-free 
products and specialist products for 
diabetics. 

In the Environmental sector, DCC 
specialises in recycling and waste 
treatment, helping to create a cleaner, 
safer environment.

Recognition of excellence in financial 
reporting
DCC won the Published Accounts Award 
for large public companies in Ireland in 
2003 and 2006. This award, organised 
by the Leinster Society of Chartered 
Accountants, is the premier award of 
excellence in financial reporting in Ireland.

To ensure that we are deploying the most 
effective and current training initiatives, 
many of our businesses are part of local 
training networks, such as the Irish Skillnet 
programmes. These allow companies 
in the same geographic area to group 
together to provide a wider variety of 
higher quality bespoke training courses. 
We also partner with other companies 
in consortium programmes, in particular 
leadership programmes, providing a 
significantly higher quality development 
experience for employees.

Training – case study 
A key initiative this year for SerCom 
Solutions in Limerick is their participation 
in a tailor made FÁS pilot training course 
as part of the Skills for Work programme. 
This led to a number of SerCom’s 
employees receiving an accredited 
FETAC certificate in communication and 
language.

Employee Share Scheme 
DCC established the DCC Sharesave 
Scheme in 2000. Under the Scheme, all 
employees of the Group’s subsidiaries 
were invited to enter into savings contracts 
for 3 and 5 year periods following which 
they could exercise options to buy DCC 
shares. The options were granted at 
prices which represented discounts of 
20% to the then market price. Over 2,000 
employees joined the Scheme in 2001 and 
2004. Through this Scheme a significant 
percentage of employees have or will 
become shareholders in DCC.

Diversity and equal opportunities
DCC recognises the strengths and 
benefits of a diverse workforce and 
is committed to providing equal 
opportunities to all employees.

 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

41

Community – case study
One initiative supported by DCC’s 
subsidiary, Flogas UK, is the ‘Break for 
Kids’ programme. This aims to help 
economically disadvantaged children to 
go on adventure holidays with the Youth 
Hostel Association that their families could 
not otherwise afford. 

As the main sponsor Flogas supports 
this initiative financially and many of its 
employees raise additional funds through 
taking part in events such as the London 
Marathon.

Legislation
The Registration, Evaluation, Authorisation 
and Restriction of Chemicals (REACH) 
Directive became law throughout 
Europe on 1 June 2007 and its various 
requirements will be implemented over 
the coming years, in conjunction with 
the development of the new Globally 
Harmonised System of classifying and 
labelling chemicals. The legislation aims 
to comprehensively control all chemicals 
used in the EU market. Each DCC 
subsidiary has assessed the impact of 
this regulation on its business and has 
taken appropriate actions to ensure 
compliance, including registration of use 
and communication with suppliers and 
downstream users.

Community
DCC subsidiaries are committed to 
ensuring that the needs and interests 
of the local communities in which they 
operate are taken into consideration and 
are sensitive to the impact their business 
operations may have on neighbours. 
They support local initiatives and charities 
within their communities and encourage 
their employees in their endeavours to 
contribute in many different ways to 
philanthropic initiatives. 

Environment, health & safety
Environment, health & safety (‘EHS’) 
management systems
All our subsidiaries operate EHS 
management systems appropriate to the 
nature and scale of their EHS risk profile. 
Identification of hazards, assessment 
of the risks and the introduction of 
control measures form the basis of 
these systems. Furthermore, monitoring, 
measurement and review of the control 
measures ensures a continuous 
improvement cycle is maintained. 

During the year, Enva achieved 
certification to the internationally 
recognised OHSAS18001 health and 
safety management system standard for 
its four Irish sites – in Dublin, Portlaoise, 
Cork and Shannon. Within our IT division, 
Sercom Solutions in Limerick has also 
been certified to OHSAS 18001. 

EHS review of DCC Energy
DNV, a leading provider of risk 
management services, completed a 
review of the existing EHS structures 
and processes within DCC’s Energy 
division. The independent expert appraisal 
provided the opportunity for ‘fresh eyes’ to 
examine the EHS management processes 
and to share best practice from peer 
companies. As part of the review, senior 
managers at subsidiary and divisional 
level were interviewed and internal EHS 
documentation was examined by the DNV 
team. Recommendations and suggestions 
from the DNV report were principally 
centred on further development of EHS 
leadership, improving communication, 
strengthening EHS objectives and the 
ongoing promotion of a proactive safety 
culture throughout the organisation. The 
recommendations formed the basis for 
the development of formal, high level EHS 
objectives and targets for DCC Energy 
subsidiaries.  

42

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Report of the Directors
for the year ended 31 March 2008

The Directors of DCC plc present 
their report and the audited financial 
statements for the year ended 31 March 
2008.

Results
The profit for the financial year 
attributable to equity holders of the 
Company amounted to €164.5 million as 
set out in the Group Income Statement 
on page 57.

Dividends
An interim dividend of 20.55 cent per 
share, amounting to €16.56 million, 
was paid on 7 December 2007. The 
Directors recommend the payment of a 
final dividend of 36.12 cent per share, 
amounting to €29.19 million. Subject 
to shareholders’ approval at the Annual 
General Meeting on 18 July 2008, this 
dividend will be paid on 24 July 2008 to 
shareholders on the register on 30 May 
2008. The total dividend for the year 
ended 31 March 2008 amounts to 56.67 
cent per share, a total of €45.75 million.

The profit attributable to equity holders 
of the Company, which has been 
transferred to reserves, and the dividends 
paid during the year ended 31 March 
2008 are shown in note 39 on page 100.

Capital and treasury shares
DCC’s authorised share capital is 
152,368,568 ordinary shares of €0.25 
each. At 31 March 2008, DCC had a 
total of 80,815,165 ordinary shares of 
€0.25 each in issue excluding treasury 
shares and 7,414,239 ordinary shares of 
€0.25 each held in Treasury.

The number of shares held in Treasury 
at the beginning of the year (and the 
maximum number held) was 7,816,256 
(8.86% of the issued share capital) with a 
nominal value of €1.954 million.

A total of 402,017 shares (0.46% of the 
issued share capital) with a nominal value 
of €0.101 million were re-issued during 
the year at prices ranging from €6.22 to 
€12.63 consequent to the exercise of 
share options under the DCC plc 1998 
Employee Share Option Scheme and the 
DCC Sharesave Scheme 2001, leaving 
a balance held in Treasury at 31 March 
2008 of 7,414,239 shares (8.40% of the 
issued share capital) with a nominal value 
of €1.854 million.

At the Company’s Annual General 
Meeting on 20 July 2007, the Company 
was granted authority to purchase up to 
8,822,940 of its own shares (10% of the 
issued share capital) with a nominal value 
of €2.206 million. This authority has not 
been exercised and will expire on 18 July 
2008, the date of the next Annual General 
Meeting of the Company. A special 
resolution will be proposed at the Annual 
General Meeting to renew this authority.

At each Annual General Meeting, in 
addition to the authority to buy back 
shares referred to above, the Directors 
seek authority to exercise all the powers 
of the Company to allot shares up to 
an aggregate amount of €7,352,400, 
representing approximately one third of 
the issued share capital of the Company. 
The Directors also seek authority to 
allot shares for cash, other than strictly 
pro-rata to existing shareholdings. 
This proposed authority is limited to 
the allotment of shares in specific 
circumstances relating to rights issues 
and other issues up to approximately 5% 
of the Company’s issued share capital.

Review of activities and 
events since the year end
The Chairman’s Statement on pages 8 
to 9, the Chief Executive’s Review on 
pages 10 to 13, the Business Reviews on 
pages 14 to 33 and the Financial Review 
on pages 34 to 39 contain a review of 
the development and performance of the 
Group’s business during the year, of the 
state of affairs of the business at 31 March 
2008, of recent events and of likely future 
developments. Information in respect of 
events since the year end as required by 
the Companies (Amendment) Act, 1986 is 
also included in these sections.

Principal risks and 
uncertainties
Under Regulation 37 of the European 
Communities (Companies: Group 
Accounts) Regulations 1992, as 
amended, DCC is required to give a 
description of the principal risks and 
uncertainties facing the Group.

The principal risks and uncertainties 
faced by the Group’s businesses relate 
to the macro economic environment in 
Ireland, Britain and Continental Europe. 
The level of activity in these markets 
is sensitive to economic conditions 
generally, including, inter alia, economic 
growth, interest rates and inflation. 

As detailed throughout this Annual 
Report, DCC’s businesses operate in a 
diverse range of business areas. This 
diversification reduces the potential 
impact of industry specific risk on the 
DCC Group as a whole. DCC’s largest 
division, DCC Energy, operates in a 
market with volatile and rising cost of 
product.

The principal financial risks facing the 
Group are addressed under ‘Financial 
Risk Management’ in the Financial 
Review on pages 34 to 39. 

The Group has a comprehensive system 
of risk management and internal controls 
as detailed under ‘Internal Control’ in the 
Corporate Governance statement on 
pages 44 to 49.

Principal subsidiaries and 
joint ventures
Details of the Company’s principal 
operating subsidiaries and joint ventures 
are set out on pages 111 to 114.

Directors 
The names of the Directors and a short 
biographical note on each Director 
appear on pages 4 to 5.

On 30 June 2007, Alex Spain retired 
from his position as Chairman and non-
executive Director. On 1 July 2007, Jim 
Flavin, previously Chief Executive/Deputy 
Chairman, was appointed Executive 
Chairman. On 27 May 2008, Jim Flavin 
resigned from his position as Executive 
Chairman and Director. On the same 
date, Michael Buckley was appointed 
Chairman and Tommy Breen, previously 
Group Managing Director, was appointed 
Chief Executive.

From 2008, the Directors have decided 
to adopt the practice that all Directors will 
be subject to re-election at each Annual 
General Meeting.

None of the retiring Directors has a 
service contract with the Company or 
with any member of the Group.

Details of the Directors’ interests in the 
share capital of the Company are set out 
in the Report on Directors’ Remuneration 
and Interests on pages 50 to 53.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

43

Report of the Directors (continued)

Substantial shareholdings
The Company has been advised of the following interests in its share capital as at 4 June 2008:

No. of €0.25 
Ordinary Shares  

% of Issued
Share Capital 

(excluding treasury    

FMR LLC and FIL Limited on behalf of certain of their direct and indirect subsidiaries *  

11,983,330  

AIM Trimark Investments * 

Bank of Ireland Asset Management Limited * 

Irish Life Investment Managers* 

Schroder Investment Management Limited and Schroder & Co. Limited * 

shares)

14.74%

8.07%

6.59%

3.53%

3.53%

3.32%

6,559,324 

5,358,998 

2,871,178 

2,867,244 

2,700,000 

Jim Flavin 

* Notified as non-beneficial interests

Corporate governance
Statements by the Directors in relation 
to the Company’s appliance of the 
principles and compliance with the 
provisions of the Combined Code on 
Corporate Governance, the Group’s 
system of internal control and the 
adoption of the going concern basis in 
preparing the financial statements are 
set out in the Corporate Governance 
statement on pages 44 to 49. Details 
regarding the appointment and 
replacement of Directors can also be 
found in this statement.

Research and development
Certain Group companies carry out 
development work aimed at improving 
the quality, competitiveness and range 
of their products. This expenditure is 
not material in relation to the size of the 
Group and is written off to the profit and 
loss account as it is incurred.

Political contributions
There were no political contributions 
which require to be disclosed under the 
Electoral Act, 1997.

by the Directors on 16 May 2008. As a 
consequence of the resignation of Jim 
Flavin as Executive Chairman on 27 May 
2008 and the appointment of Michael 
Buckley as Chairman and Tommy Breen 
as Chief Executive on the same date, it 
was necessary to make amendments 
to the Annual Report, particularly the 
Chairman’s Statement and the Chief 
Executive’s Review. Accordingly, the 
approval date of the Group’s financial 
statements by the Board of Directors has 
been amended to 9 June 2008.

Auditors
The auditors, PricewaterhouseCoopers, 
will continue in office in accordance with 
the provisions of Section 160(2) of the 
Companies Act, 1963.

Michael Buckley, Tommy Breen
Directors
9 June 2008

Accounting records
The Directors are responsible for 
ensuring that proper books and 
accounting records, as outlined in 
Section 202 of the Companies Act, 
1990, are kept by the Company. 
The Directors believe that they have 
complied with this requirement by 
providing adequate resources to 
maintain proper books and accounting 
records throughout the Group including 
the appointment of personnel with 
appropriate qualifications, experience 
and expertise. The books and 
accounting records of the Company are 
maintained at the Company’s registered 
office, DCC House, Brewery Road, 
Stillorgan, Blackrock, Co. Dublin, Ireland.

Articles of Association
Amendments to the Articles of 
Association can only be effected by 
special resolution of shareholders.

Statutory accounts 
In the notes to the Preliminary Results for 
the year ended 31 March 2008, issued 
on 19 May 2008, it was stated that the 
Group’s financial statements for the year 
to 31 March 2008 had been approved 

 
 
 
 
 
 
 
 
 
 
 
44

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Corporate Governance

The Board has recently evaluated the 
independence of each of its non-executive 
Directors. In the case of Tony Barry and 
Paddy Gallagher, the Board gave due 
consideration to the fact that they have 
served on the Board for more than nine 
years from the date of their first election. 
The Board has concluded that all of the 
non-executive Directors are independent of 
management and free of any relationships 
which could interfere with the exercise of 
their independent judgment.

The Board has appointed Bernard Somers 
as the Senior Independent Director. Mr. 
Somers is available to shareholders who 
have concerns that cannot be addressed 
through the Chairman or Chief Executive.

Board procedures
There is an established procedure for 
Directors to take independent professional 
advice in the furtherance of their duties 
if they consider this necessary. All 
Directors have access to the advice and 
services of the Company Secretary who 
is responsible to the Board for ensuring 
that Board procedures are followed and 
that applicable rules and regulations are 
complied with. 

The Board recognises the need for 
Directors, in particular new Directors, to 
be aware of their legal responsibilities 
as directors and, in addition, the Board 
ensures that Directors are kept up to 
date on the latest corporate governance 
guidance and best practice. There is a 
full, formal and tailored induction process 
for new non-executive Directors, which 
includes detailed presentations on the 
Group’s operations.

Meetings
The Board holds regular meetings and 
there is contact as required between 
meetings in order to progress the Group’s 
business. During the year, the Board held 
seven meetings. Individual attendance at 
these meetings is set out in the table on 
page 45.

Remuneration
Details of remuneration paid to the 
Directors are set out in the Report on 
Directors’ Remuneration and Interests  
on pages 50 to 53.

Non-executive Chairman
On his appointment as Chairman on 27 
May 2008, Michael Buckley, formerly 
Senior Independent Director, ceased to 
be defined as independent under the 
provisions of the Combined Code on 
Corporate Governance.

The Fyffes case 
DCC issued a statement, in a Stock 
Exchange announcement on 20 May 
2008, in relation to the corporate 
governance aspects of the Fyffes case, 
which is set out as an Appendix to this 
Corporate Governance statement.

Board Committees
Audit Committee
The Audit Committee comprises three 
independent non-executive Directors, 
Bernard Somers (Chairman), Róisín 
Brennan and Maurice Keane. The Board 
has determined that Bernard Somers is 
the Committee’s financial expert. Paddy 
Gallagher resigned from the Committee on 
13 May 2008 and was replaced by Maurice 
Keane. The Committee met twice during 
the year. Individual attendance at these 
meetings is set out in the table on page 45.

The Chief Executive, Chief Financial Officer, 
Head of Enterprise Risk Management, 
Group Internal Auditor, other Directors 
and executives and representatives of the 
external auditors may be invited to attend all 
or part of any meeting. The Committee also 
meets separately with the external auditors 
and with the Group Internal Auditor without 
executive management present. 

The role and responsibilities of the Audit 
Committee are set out in its written terms 
of reference, which are available on 
request and on the Company’s website 
www.dcc.ie, and include:

•   monitoring the integrity of the financial 
statements of the Company and any 
formal announcements relating to the 
Company’s financial performance and 
reviewing significant financial reporting 
judgments contained in them;

•   reviewing the half-year and annual 

financial statements before submission 
to the Board;

This statement describes how DCC has 
applied the principles set out in Section 
1 of the Combined Code on Corporate 
Governance (June 2006) published by the 
Financial Reporting Council in the UK.

The Board of Directors
Role
The Board of DCC is responsible for the 
leadership, strategic direction and overall 
management of the Group and has a 
formal schedule of matters specifically 
reserved to it for decision, which covers 
key areas of the Group’s business 
including approval of the annual strategy 
statement, the financial statements, 
budgets (including capital expenditure), 
acquisitions and dividends.

The Board has delegated responsibility for 
the management of the Group to the Chief 
Executive and executive management. 
Certain additional matters are delegated to 
Board Committees.

Composition
The Board consists of two executive 
and six non-executive Directors. Brief 
biographies of the Directors are set out on 
pages 4 to 5. 

Non-executive Directors are appointed by 
the Board for an initial term of three years 
and the expectation is that they will be 
invited to serve a second three-year term. 
The Board may also invite non-executive 
Directors to serve an additional period 
thereafter. The terms and conditions of 
appointment of non-executive Directors 
are set out in their letters of appointment, 
which are available for inspection at the 
Company’s registered office during normal 
office hours and at the Annual General 
Meeting of the Company.

Following appointment, Directors 
are, in accordance with the Articles 
of Association, subject to re-election 
at the next Annual General Meeting. 
Subsequently, at least one third of the 
Directors must retire at each Annual 
General Meeting and all of the Directors 
are subject to re-election at least every 
three years. From 2008, the Directors 
have decided to adopt the practice that all 
Directors will be subject to re-election at 
each Annual General Meeting.

All of the Directors bring independent 
judgment to bear on issues of strategy, 
risk, performance, resources, key 
appointments and standards. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

45

Corporate Governance (continued)

•   considering and making 

•   reviewing the Group’s arrangements 

recommendations to the Board 
in relation to the appointment, 
reappointment and removal of the 
external auditors and approving the 
audit fee and terms of engagement of 
the external auditors;

•   approving the remuneration of the 
external auditors, whether fees for 
audit or non-audit services, and 
ensuring that the level of fees is 
appropriate to enable an adequate 
audit to be conducted;

•   assessing annually the independence 
and objectivity of the external auditors 
and the effectiveness of the audit 
process, taking into consideration 
relevant professional and regulatory 
requirements and the relationship 
with the external auditors as a whole, 
including the provision of any non-
audit services;

•   reviewing the operation and the 

effectiveness of the Group Internal 
Audit function;

•   reporting to the Board on its annual 
assessment of the operation of the 
Group’s system of internal control, 
making any recommendations to 
the Board thereon and reviewing the 
Company’s statements on internal 
control and risk management prior to 
endorsement by the Board; and

for its employees to raise concerns, in 
confidence, about possible wrongdoing 
in financial reporting or other matters 
and ensuring that these arrangements 
allow proportionate and independent 
investigation of such matters and 
appropriate follow up action.

These responsibilities are discharged 
through its meetings and receipt of 
reports from the Risk Committee and the 
Enterprise Risk Management function 
(incorporating Group Internal Audit and 
Group Environmental, Health and Safety). 

The Committee has a process in place 
to ensure that the independence of 
the audit is not compromised, which 
includes monitoring the nature and extent 
of services provided by the external 
auditors through its annual review of fees 
paid to the external auditors for audit 
and non-audit work. The Committee 
also reviews the safeguards which the 
external auditors have put in place to 
ensure their objectivity and independence 
in accordance with professional and 
regulatory requirements.

Details of the amounts paid to the 
external auditors during the year for audit 
and other services are set out in note 6 
on page 77.

Nomination Committee
The Nomination Committee comprises 
Michael Buckley (Chairman) and two 
independent non-executive Directors, 
Maurice Keane and Bernard Somers. Jim 
Flavin resigned from the Committee on 
27 May 2008. The Committee met twice 
during the year. Individual attendance 
at these meetings is set out in the table 
below.

The role and responsibilities of the 
Nomination Committee are set out in 
its written terms of reference, which 
are available on request and on the 
Company’s website www.dcc.ie. The 
principal responsibilities of the Committee 
are to keep Board renewal, structure, 
size and composition under constant 
review, including the skills, knowledge 
and experience required. 

The Committee has particular regard to 
the leadership needs of the organisation, 
both executive and non-executive.

Remuneration Committee
The Remuneration Committee comprises 
Michael Buckley and three independent 
non-executive Directors, Maurice Keane 
(Chairman), Róisín Brennan and Bernard 
Somers. Tony Barry resigned from the 
Committee on 24 April 2008. Bernard 
Somers was appointed to the Committee 
on 4 June 2008. The Committee met 
three times during the year. Individual 
attendance at these meetings is set out 
in the table below.

Attendance at Board and Committee meetings during the year ended 31 March 2008

Director 

  Board 

Michael Buckley 
Tommy Breen 
Tony Barry1 
Róisín Brennan 
Jim Flavin2 
Paddy Gallagher3 
Maurice Keane3 
Fergal O’Dwyer 
Bernard Somers4 
Alex Spain5  

A 

7 
7 
7 
7 
7 
7 
7 
7 
7 
1 

B 

7 
7 
6 
7 
7 
7 
7 
7 
7 
1 

  Audit 
 Committee  
B 
A 

 Nomination  
 Committee   
B 
A 

Remuneration
 Committee
A 

B 

- 
- 
- 
2 
- 
2 
- 
- 
2 
- 

- 
- 
- 
2 
- 
2 
- 
- 
2 
- 

2 
- 
- 
- 
2 
- 
2 
- 
2 
- 

2 
- 
- 
- 
2 
- 
2 
- 
2 
- 

3 
- 
3 
3 
- 
- 
3 
- 
- 
- 

3
-
3
3
-
-
3
-
-
-

Column A indicates the number of meetings held during the period the Director was a member of the Board and/or Committee.
Column B indicates the number of meetings attended during the period the Director was a member of the Board and/or Committee.

1 Tony Barry resigned from the Remuneration Committee on 24 April 2008. 
2 Jim Flavin resigned on 27 May 2008.
3 Paddy Gallagher resigned from the Audit Committee on 13 May 2008 and was replaced by Maurice Keane.
4 Bernard Somers was appointed to the Remuneration Committee on 4 June 2008.
5 Alex Spain retired on 30 June 2007.

 
 
 
   
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
46

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Corporate Governance 
(continued)

The role and responsibilities of the 
Remuneration Committee are set out 
in its written terms of reference, which 
are available on request and on the 
Company’s website www.dcc.ie. 

These evaluations are designed to 
determine whether each Director 
continues to contribute effectively and 
continues to demonstrate commitment 
to the role.

The principal responsibilities of the 
Committee are determining the policy 
for the remuneration of the executive 
Directors and determining their 
remuneration packages, including targets 
for any performance-related pay, pension 
rights and compensation payments, and 
the granting of share options under the 
DCC plc 1998 Employee Share Option 
Scheme. The Committee also monitors 
the level and structure of remuneration of 
other senior management.

The Chief Executive makes 
recommendations to the Remuneration 
Committee on remuneration for the other 
executive Directors. The Remuneration 
Committee is authorised to obtain 
access to professional advice if deemed 
desirable.

Fyffes Case Oversight Committee 
On 21 August 2007, the Board 
established a Committee of non-
executive Directors, comprising Michael 
Buckley (Chairman), Maurice Keane 
and Bernard Somers, to oversee issues 
arising from the Supreme Court judgment 
in the Fyffes case.

Performance evaluation
The Board undertakes a formal annual 
evaluation of its own performance, that 
of each of its principal committees, the 
Audit, Nomination and Remuneration 
committees, and that of individual 
directors, using the ‘Performance 
Evaluation Guidance’ set out in the Higgs 
Suggestions for Good Practice. 

The Chairman, on behalf of the Board, 
conducts evaluations of performance 
with each of the non-executive Directors 
on an annual basis. 

The non-executive Directors, led by 
the Senior Independent Director, meet 
annually without the Chairman present to 
evaluate his performance, having taken 
into account the views of the executive 
Directors. The non-executive Directors 
also evaluate the performance of each 
executive Director. 

The Audit, Nomination and Remuneration 
committees carry out annual reviews 
of their own performance and terms of 
reference to ensure they are operating at 
maximum effectiveness and recommend 
any changes they consider necessary to 
the Board for approval. 

Relations with shareholders
Communications with shareholders are 
given high priority and DCC has a well 
established investor relations function.

The Board is kept informed of the views 
of shareholders through the executive 
Directors’ attendance at investor 
presentations and results presentations. 
Furthermore, relevant feedback from 
such meetings, investor relations reports 
and brokers notes are provided to the 
entire Board on a regular basis.

The Company’s website www.dcc.ie
provides the full text of annual and 
interim reports as well as all press 
releases. It also incorporates audio and 
slide show investor presentations.

The Company’s Annual General Meeting 
affords shareholders the opportunity to 
question the Chairman and the Board. 
The chairmen of the Audit, Nomination 
and Remuneration Committees are 
also available to answer questions at 
the Annual General Meeting. The Chief 
Executive presents at the Annual General 
Meeting on the Group’s business and its 
performance during the prior year and 
answers questions from shareholders. 
Shareholders can meet with the 
Chairman or the Senior Independent 
Director on request.

Notice of the Annual General Meeting, 
the Form of Proxy and the Annual Report 
are sent to shareholders at least 20 
working days before the meeting. At the 
Meeting, after each resolution has been 
dealt with, details are given of the level of 
proxy votes cast on each resolution and 
the numbers for, against and withheld.

The 2008 Annual General Meeting will 
be held at 11 a.m. on 18 July 2008 at 
The Four Seasons Hotel, Simmonscourt 
Road, Ballsbridge, Dublin 4, Ireland.

Internal control
The Board is responsible for the 
Group’s system of internal control and 
for reviewing its effectiveness. Such a 
system is designed to manage rather 
than eliminate the risk of failure to 
achieve business objectives and can 
provide only reasonable and not absolute 
assurance against material misstatement 
or loss.

In accordance with the revised Turnbull 
guidance for directors on internal control 
published in October 2005, ‘Internal 
Control: Revised Guidance for Directors 
on the Combined Code’, the Board 
confirms that there is an ongoing process 
for identifying, evaluating and managing 
any significant risks faced by the Group, 
that it has been in place for the year 
under review and up to the date of 
approval of the financial statements and 
that this process is regularly reviewed by 
the Board.

The key risk management and internal 
control procedures, which are supported 
by detailed controls and processes, 
include:

•   skilled and experienced Group and 

divisional management;

•   an organisation structure with 

clearly defined lines of authority and 
accountability;

•   a comprehensive system of financial 

reporting involving budgeting, monthly 
reporting and variance analysis;

•   the operation of approved risk 

management policies (including 
treasury and IT);

•   a Risk Committee, comprising Group 
senior management, whose main role 
is to keep under review and report to 
the Audit Committee on the principal 
risks facing the Group, the controls in 
place to manage those risks and the 
monitoring procedures;

•   an independent Enterprise Risk 
Management function, which 
incorporates Group Internal Audit 
and Group Environmental, Health and 
Safety; and

DCC - ANNUAL REPORT AND ACCOUNTS 2008

47

Corporate Governance (continued)

•   a formally constituted Audit 

Committee which reviews the 
operation of the Risk Committee and 
the Enterprise Risk Management 
function, liaises with the external 
auditors and reviews the Group’s 
internal control systems.

The Board has reviewed the 
effectiveness of the Group’s system 
of internal control. This review took 
account of the principal business risks 
facing the Group, the controls in place to 
manage those risks (including financial, 
operational and compliance controls and 
risk management) and the procedures in 
place to monitor them.

Going concern
After making enquiries, the Directors 
have formed a judgment, at the time of 
approving the financial statements, that 
there is a reasonable expectation that 
the Company and the Group as a whole 
have adequate resources to continue in 
operational existence for the foreseeable 
future. For this reason, they continue 
to adopt the going concern basis in 
preparing the financial statements. The 
Directors’ responsibility for preparing the 
financial statements is explained on page 
54 and the reporting responsibilities of 
the auditors are set out in their report on 
pages 55 and 56.

Compliance statement
DCC has complied, throughout the 
year ended 31 March 2008, with 
the provisions set out in Section 1 of 
the Combined Code on Corporate 
Governance, except in relation to the 
appointment of the Executive Chairman 
in July 2007. However, as required by the 
Code, the Board consulted with major 
shareholders, and also with the Irish 
Association of Investment Managers, and 
explained in the Corporate Governance 
statement in the 2007 Annual Report 
the reasons why it considered it was 
appropriate and in shareholders’ best 
interests that Jim Flavin be appointed 
Executive Chairman on 1 July 2007. 
With the appointment of Michael Buckley 
as non-executive Chairman on 27 May 
2008, that exception no longer exists. 
The Board of DCC is committed to 
maintaining the highest standards of 
corporate governance.

APPENDIX - The Fyffes Case

DCC Board Review, Action and 
Oversight
Over the past number of years, 
the Board of DCC has kept under 
continuous scrutiny the litigation which 
was launched in January 2002 by Fyffes 
plc against DCC, two of its subsidiaries 
and Jim Flavin under Part V of the 
Irish Companies Act, 1990 seeking an 
account of the profit arising on the sale of 
31,169,493 shares in Fyffes in February 
2000 by a subsidiary of DCC. 

Fyffes claimed that certain Fyffes trading 
reports which had been sent to Fyffes 
directors including Jim Flavin, who 
was a non-executive director of Fyffes 
at the time, were price sensitive. In a 
judgment delivered in December 2005 
the High Court concluded that the 
information in the trading reports was 
not price sensitive, that the involvement 
in the share sales of Jim Flavin as Chief 
Executive of DCC constituted a dealing 
by him under Part V of the Companies 
Act, 1990 and that he had not made use 
of that information which the Court found 
“simply had no bearing on the Share 
Sales”. Only one finding of the High 
Court was appealed by Fyffes, namely 
its decision that the trading reports were 
not price sensitive. On 27 July 2007 the 
Irish Supreme Court overturned the High 
Court decision on this single issue. 

The Board of DCC met later that day 
and, with the benefit of input from its 
legal advisers, reviewed the corporate 
governance implications of the Supreme 
Court judgment. After a full discussion 
under the Chairmanship of Michael 
Buckley, DCC’s senior independent 
director, of all the issues arising the 
Board unanimously reaffirmed Jim Flavin 
in his role as Executive Chairman. The 
factors which it took into account in 
reaching this decision are set out below.

Following the announcement of 
the Board’s decision, DCC’s larger 
shareholders were contacted to explain 
the basis of the Board’s decision and 
each of them was given the opportunity, 
if they wished, to discuss it with Michael 
Buckley.

The Board also set up a special 
Oversight Committee of non-executive 
directors, consisting of Michael Buckley 
(Chairman), Maurice Keane and Bernard 
Somers, to oversee independently 
all matters arising from the Supreme 
Court judgment on behalf of the Board. 
As part of that role the Committee 
subsequently directed the DCC input 
into the discussions that ultimately led 
to the settlement with Fyffes which was 
announced on 14 April 2008. 

Legal Background and Key Findings

The Board believes it is important 
that it should set out for 
shareholders the legislative context 
of the High Court and Supreme 
Court litigation and the findings 
of the High Court judgment that 
were not affected by the Supreme 
Court decision, all of which it has 
taken into account in its corporate 
governance deliberations following 
the Supreme Court decision.

Possession v Use of Information 
- The Issue of Motivation
Part V of the Companies Act, 1990 was 
introduced in Ireland in order to bring into 
effect the provisions of Council Directive 
89/592/EEC. The recitals to that Directive 
make it clear that the issue with which 
the Directive was concerned was the act 
of improperly using or taking advantage 
of inside information: -

 “Whereas the factors on which such 
confidence depends include the 
assurance afforded to investors that 
they are placed on an equal footing and 
that they will be protected against the 
improper use of inside information”.

 “Whereas, since the acquisition or 
disposal of transferable securities 
necessarily involves a prior decision 
to acquire or to dispose taken by the 
person who undertakes one or other 
of these operations, the carrying-out 
of this acquisition or disposal does 
not constitute in itself the use of inside 
information; 
 Whereas insider dealing involves taking 
advantage of inside information;”

48

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Corporate Governance 
(continued)

or the use by any of the boards of the 
corporate defendants, of the confidential 
information contained in the November 
and December Trading Reports. On any 
view of the evidence, that information 
simply had no bearing on the Share 
Sales”.

Having regard to that finding, the Board 
has legal advice that had the Fyffes action 
been brought relying only on Council 
Directive 89/592/EEC or upon the law as 
it now stands in Ireland, which requires 
“use” of price sensitive information as 
opposed to mere possession, it would 
almost certainly have failed. 

The High Court also found that “the 
plaintiff has failed to establish a breach of 
fiduciary duty on the part of Mr Flavin”. 

The Supreme Court in its judgment 
recited these conclusions of the High 
Court and stated “It is a tribute to the 
extraordinary patience and care of 
the learned trial judge that none of her 
findings of primary fact are challenged on 
this appeal”. 

Another important factual finding of the 
High Court which was not affected by 
the Supreme Court judgment was as 
follows: “I did not understand the Plaintiff 
to assert dishonesty on the part of any of 
the Defendants. In any event, I find that 
dishonesty was not established on the 
evidence”.

The only issue in the appeal to the 
Supreme Court was whether the 
information in the possession of Jim 
Flavin was, in law, price sensitive at the 
time of the share sales, notwithstanding 
that the information had no bearing 
on the share sales. In the words of the 
Supreme Court “The only issue on this 
appeal is the issue which was dispositive 
of the claim in the High Court, namely 
whether the information admittedly 
available to Mr. Flavin at the time of the 
share sales was in truth price sensitive”.

In the course of carrying out his duties 
as Chief Executive of DCC, Jim Flavin 
exercised judgment at the time of the 
share sales in relation to the likely price 
effect of the Fyffes November and 
December 1999 trading reports. His 
judgment was that the trading reports 
were not price sensitive. 

At the time, no other non-executive 
director or executive director of Fyffes 
thought that the information in the trading 
reports was price sensitive. The High 
Court judgment stated “There is no 
objective evidence that any director or 
executive of Fyffes had any concern that, 
by reason of being in possession of the 
information contained in the November 
and December Trading Reports, Mr. 
Flavin was or might have been in 
possession of price-sensitive information. 
The evidence strongly suggests that such 
a possibility was not entertained at all”. 

The Fyffes action was heard before the 
Irish High Court between December 2004 
and June 2005 in a hearing which lasted 
for 87 days. Having heard witnesses of 
fact from both DCC and Fyffes and the 
opinions of several experts, the High 
Court concluded in its judgment delivered 
on 21 December 2005 that the trading 
reports sent to Jim Flavin were not price 
sensitive. 

Fyffes appealed one finding of the High 
Court, namely the decision that the 
trading reports were not price sensitive. 
In a judgment on 27 July 2007 the Irish 
Supreme Court overturned the High 
Court on this single issue. In doing so the 
Supreme Court did not ascribe any bad 
faith to DCC or Jim Flavin.

The Board respects the judgment of the 
Supreme Court and acknowledges its 
financial consequences as embodied in 
the recent financial settlement with Fyffes. 

The Directive therefore identified that 
insider dealing required both possession 
and improper use of price sensitive 
information. However, Part V of the Irish 
Companies Act, 1990 provided for a civil 
liability to arise for a party who deals in 
shares whilst simply in possession of 
price sensitive information. Furthermore, it 
did not stipulate that the party dealing or 
the company whose shares were dealt in 
must know or believe that the information 
was price sensitive. 

Part V of the Irish Companies Act, 1990 
was repealed by the Investment Funds, 
Companies and Miscellaneous Provisions 
Act 2005 upon the enactment on 6 July 
2005 of Statutory Instrument No. 342 
which implemented a new EC Directive 
on insider dealing (Market Abuse Directive 
2003/6/EC). In contrast to the 1990 Act, 
the new legislation provides that a person 
“who possesses inside information shall 
not use that information”. 

The Irish High Court reached the 
following finding, which was not appealed 
to the Supreme Court, that Jim Flavin 
had not “used” the information which was 
later determined by the Irish Supreme 
Court to be price sensitive:-

“In my view, in this case, the evidence 
is not open to the interpretation that Mr. 
Flavin used the information contained in 
the November and December Trading 
Reports which is alleged to have been 
confidential and price-sensitive, the 
negative information in relation to Fyffes’ 
trading and earnings performance in the 
first quarter of financial year 2000, so as 
to enable the DCC Group to exit from 
Fyffes in a manner which would avoid any 
share price impact which would ensue 
from the disclosure of that information. 
In my view, on the evidence, it is clear 
that what motivated Mr. Flavin in his 
involvement in the Share Sales and what 
motivated the almost total exit of the 
DCC Group from Fyffes in February, 2000 
was the opportunity to make a substantial 
profit because of the increase of the 
share price on the back of worldoffruit.
com. The plaintiff has not established 
any evidential nexus between the profit 
which the Share Sales generated for the 
DCC Group and the use by Mr. Flavin, 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

49

On 24 January 2002 Fyffes lodged a 
legal action under Part V of the Irish 
Companies Act, 1990 against DCC, two 
of its subsidiaries and Jim Flavin alleging 
that the trading reports for November 
and December 1999 were price sensitive 
and therefore that a civil liability arose 
to account for the profit arising on the 
sale of 31,169,493 shares in Fyffes in 
February 2000. 

In a judgment on 21 December 2005 the 
Irish High Court concluded that the Fyffes 
trading reports were not price sensitive, 
that the involvement in the share sales 
of Jim Flavin as Chief Executive of DCC 
constituted a dealing by him under Part 
V of the Companies Act, 1990 and that 
he had not made use of the information 
which the Court found “simply had no 
bearing on the Share Sales”. Fyffes 
appealed one finding of the High Court, 
namely the decision that the trading 
reports were not price sensitive. The 
Irish Supreme Court overturned the High 
Court decision on this single issue. 

On 14 April 2008 a settlement was 
agreed with Fyffes and counterparties 
in respect of all claims, interest and 
costs for an amount of €41 million. An 
exceptional charge of €50 million for this 
amount and DCC’s own costs has been 
made in DCC’s financial statements for 
the year ended 31 March 2008.

Corporate Governance (continued)

In the introductory paragraph of his 
Supreme Court judgment Mr. Justice 
Fennelly wrote “To trade on the use 
of inside information is recognised for 
what it is. It is a fraud on the market. 
The insider who exploits his access to 
the special knowledge he enjoys for the 
purposes of the company in his capacity 
as executive or director of a company 
commits a crime”. The Board of course 
agrees with this statement of general 
principle. The finding of the High Court 
that the share dealings in February 2000 
did not involve the use or exploitation by 
Jim Flavin of the information in the trading 
reports was not appealed and was not 
affected by the Supreme Court decision. 
The Fyffes case was a civil action and 
did not involve any allegation or finding of 
dishonesty, fraud or crime. However, Mr 
Justice Fennelly’s introductory statement 
of general principle has been inaccurately 
portrayed by some commentators in 
a manner which does not fairly reflect 
the true import of the High Court and 
Supreme Court judgments in this 
particular case. 

Conclusion
The Board is satisfied that the established 
facts surrounding the sales of Fyffes 
shares in February 2000 fully support 
its view that the share sales did not 
involve any intentional wrongdoing on 
the part of Jim Flavin and in essence 
were an unwitting breach of civil law 
under the now repealed Part V of the Irish 
Companies Act, 1990. 

Factual Background
Jim Flavin was a non-executive director 
of Fyffes from January 1981 until his 
resignation on 9 February 2000. In his 
capacity as a non-executive director 
he routinely received Fyffes trading 
reports, including the trading reports for 
November and December 1999, which 
were the first two months of Fyffes’ 
financial year to 31 October 2000. These 
reports disclosed poor trading results and 
were the reports found by the Supreme 
Court to be price sensitive.

The DCC Group had owned a 10% 
ordinary shareholding in Fyffes, a listed 
fresh produce company, since 1981 and, 
following DCC’s own listing in 1994, this 
shareholding had become anomalous 
and it had become the DCC Group’s 
objective to sell it if an opportunity 
arose. On 3, 8 and 14 February 2000, in 
response to unsolicited offers from two 
stockbroking firms, a DCC subsidiary 
sold 31,169,493 Fyffes ordinary shares 
at prices of between €3.20 and €3.90 
per share. The offers for the Fyffes shares 
arose from what the High Court judge 
described as the “very considerable 
enthusiasm for dotcom stocks or stocks 
with a dotcom component in January 
and February, 2000”. In November 
1999 Fyffes had launched a subsidiary 
called worldoffruit.com. In its Chairman’s 
Statement dated 31 January 2000 
included in its 1999 Annual Report 
Fyffes stated that worldoffruit.com 
“looks set to dramatically change the 
way in which fresh fruit and vegetables 
are traded across the globe”. Resulting 
from the exuberance for dotcom stocks 
Fyffes share price rose from €1.60 on 1 
December 1999 to a peak of €4.00 on 
18 February 2000, notwithstanding the 
fact that it was known that Fyffes’ core 
banana business faced very challenging 
trading conditions. For example, ABN 
Amro in a research note dated 14 
January 2000 commented: “Fyffes 
shares have rallied strongly since the full 
year results on recognition of its internet 
potential - but in blatant disregard to the 
recent profit warnings of its competitors 
Dole, Chiquita and Del Monte Fresh 
Produce”. 

Arising from continued difficult trading 
into February and March 2000 in its 
banana business, Fyffes issued a profit 
warning on 20 March 2000 at a time 
when the dotcom bubble had begun to 
burst and when the Fyffes share price 
had already commenced a decline.

50

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Report on Directors’ Remuneration and Interests

Directors’ remuneration
Executive Directors’ remuneration
Salaries
The salaries of executive Directors 
are reviewed annually on 1 January 
having regard to personal performance, 
Company performance and competitive 
market practice. No fees are payable to 
executive Directors.

Performance related annual bonuses
Performance related annual bonuses 
are payable to the executive Directors 
in respect of the financial year to 31 
March. The maximum bonus potential, 
as a percentage of basic salary, for 
each executive Director is reviewed and 
set annually and ranged between 75% 
and 100% of basic salary for the year 
ended 31 March 2008.

The performance targets, which are 
reviewed annually, primarily relate to 
growth in Group earnings and also to 
the overall contribution and personal 
performance of each executive 
Director, including Group development.

Pension benefits
The Company funds pension schemes 
which, for executive Directors, aim 
to provide, on the basis of actuarial 
advice, a pension of two thirds of 
pensionable salary at normal retirement 
date. Pensionable salary is calculated 
as 105% of basic salary and does 
not include any performance related 
bonuses or benefits.

Non-Executive Directors’ 
remuneration
The remuneration of the non-executive 
Directors is determined by the Board. 
The fees paid to non-executive 
Directors reflect their experience and 
ability and the time demands of their 
Board and Board Committee duties.

Remuneration Committee
The Remuneration Committee 
comprises Michael Buckley and three 
independent non-executive Directors, 
Maurice Keane (Chairman), Róisín 
Brennan and Bernard Somers. Tony 
Barry resigned from the Committee on 
24 April 2008. Bernard Somers was 
appointed to the Committee on 4 June 
2008.

The role and responsibilities of the 
Remuneration Committee are set 
out in its written terms of reference, 
which are available on request and 
on the Company’s website www.dcc.
ie. The principal responsibilities of 
the Committee are determining the 
policy for the remuneration of the 
executive Directors and determining 
their remuneration packages, including 
targets for any performance-related 
pay, pension rights and compensation 
payments, and the granting of share 
options under the DCC plc 1998 
Employee Share Option Scheme. The 
Committee also monitors the level 
and structure of remuneration of other 
senior management.

The Chief Executive makes 
recommendations to the Remuneration 
Committee on remuneration for 
the other executive Directors. The 
Remuneration Committee is authorised 
to obtain access to professional advice 
if deemed desirable.

Remuneration policy
The Company’s remuneration policy 
recognises that employment and 
remuneration conditions for the Group’s 
senior executives must properly reward 
and motivate them to perform in the best 
interests of the shareholders. 

In formulating remuneration policy, the 
Committee has given due regard to the 
provisions of the Combined Code on 
Corporate Governance.

The typical elements of the remuneration 
package for senior executives are basic 
salary, performance related remuneration 
consisting of performance related annual 
bonuses and share options, pension 
benefits and other taxable benefits 
(principally the use of a company car).

DCC - ANNUAL REPORT AND ACCOUNTS 2008

51

Report on Directors’ Remuneration and Interests (continued)

Directors’ remuneration details
The table below sets out the details of the remuneration payable in respect of Directors who held office for any part of the financial year. 

Salary and 
fees1 

Bonus 

Benefits2 

Pension  
contribution3

Total

Executive Directors
Tommy Breen 
Fergal O’Dwyer 
Jim Flavin4 
Kevin Murray5 

Total for executive  
Directors 

Non-executive Directors
Tony Barry 
Róisín Brennan  
Michael Buckley  
Paddy Gallagher 
Maurice Keane  
Bernard Somers 
Alex Spain6 

Total for non-executive  
Directors 

2008 

2007
  €’000  €’000  €’000  €’000  €’000  €’000  €’000  €’000  €’000  €’000

2008 

2008 

2008 

2008 

2007 

2007 

2007 

2007 

514 
347 
832 
- 

410 
329 
846 
90 

411 
240 
* 
- 

246 
198 
508 
- 

22 
21 
38 
- 

22 
21 
39 
5 

149 
116 
119 
- 

122 
110 
127 
30 

1,096 
724 
989 
- 

800
658
1,520
125

  1,693 

1,675 

651 

952 

81 

87 

384 

389 

2,809 

3,103

61 
69 
69 
64 
69 
79 
41 

57 
65 
62 
60 
65 
75 
153 

452 

537 

- 
- 
- 
- 
- 
- 
- 

- 

- 
- 
- 
- 
- 
- 
- 

- 

- 
- 
- 
- 
- 
- 
- 

- 

- 
- 
- 
- 
- 
- 
- 

- 

- 
- 
- 
- 
- 
- 
- 

- 

- 
- 
- 
- 
- 
- 
- 

- 

61 
69 
69 
64 
69 
79 
41 

57
65
62
60
65
75
153

452 

537

10 

10

3,271 

3,650

Ex gratia pension to dependant of retired Director  

Total  

 *   At the meeting of the Remuneration Committee held on 24 April 2008 for the purpose of determining  executive Director bonuses 

for the year to 31 March 2008, Jim Flavin informed the Committee that, in light  of the financial cost to DCC of the Supreme 
Court decision in the Fyffes case, he did not wish to receive any  bonus in respect of the year, notwithstanding his belief at the 
time of the sale of the DCC Group’s 10%  shareholding in Fyffes plc in February 2000 that he was acting correctly and in the best 
interests of DCC and  its shareholders.

Notes
1   Fees are payable only to non-executive Directors and include Board Committee fees.
2   In the case of the executive Directors, benefits relate principally to the use of a company car.
3 

 Executive Director pension contributions in the year ended 31 March 2008 were made to a defined benefit scheme for Tommy Breen 
and Fergal O’Dwyer and to a defined contribution arrangement for Jim Flavin.

4  Jim Flavin resigned as a Director on 27 May 2008.
5  Kevin Murray resigned as a Director on 30 June 2006.
6  Alex Spain retired as a Director on 30 June 2007.

Directors’ defined benefit pensions
The table below sets out the increase in the accrued pension benefits to which executive Directors have become entitled during the year 
ended 31 March 2008 and the transfer value of the increase in accrued benefit, under the Company’s defined benefit pension scheme:

Executive Directors
Tommy Breen  
Fergal O’Dwyer 

Total 

Increase in 
accrued pension 
benefit (excl inflation)  
during the year1 

Transfer value
equivalent to the 
increase in accrued 
 pension benefit2 

Total
accrued pension
benefit at year end3

€’000 

35 
10 

45 

€’000 

396 
174 

570 

€’000

191
128

319

Notes 
1   Increases are after adjustment for inflation over the year and reflect additional pensionable service and salary.
2 

 The transfer value equivalent to the increase in accrued pension benefit has been calculated on the basis of actuarial advice in 
accordance with Actuarial Guidance Note GN11. The transfer values do not represent sums paid to or due to the Directors named, but 
are the amounts that would transfer to another pension scheme in respect of the increase in accrued pension benefit during the year.

3   Figures represent the total accrued pension payable from normal retirement date, based on pensionable service at 31 March 2008.

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
52

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Report on Directors’ Remuneration and Interests
(continued)

Share options
DCC plc 1998 Employee Share 
Option Scheme
Executive Directors and other senior 
executives participate in the DCC plc 
1998 Employee Share Option Scheme, 
which was approved by shareholders 
in 1998. The Scheme encourages 
identification with shareholders’ interests 
by enabling management to build, over 
time, a shareholding in the Company 
which is material to their net worth. 

The percentage of share capital which 
can be issued under the Scheme, the 
phasing of the grant of options and the 
limit on the value of options which may 
be granted to any individual comply with 
guidelines published by the institutional 
investment associations. The Scheme 
provides for the grant of both basic and 
second tier options, in each case up to 
a maximum of 5% of the Company’s 
issued share capital. Basic tier options 
may not normally be exercised earlier 
than three years from the date of grant 
and second tier options not earlier than 
five years from the date of grant. 

Basic tier options may normally be 
exercised only if there has been growth 
in the adjusted earnings per share of 
the Company equivalent to the increase 
in the Consumer Price Index plus 2%, 
compound, per annum over a period of 
at least three years following the date of 
grant.

Second tier options may normally be 
exercised only if the growth in the 
adjusted earnings per share over a 
period of at least five years is such as 
would place the Company in the top 
quartile of companies on the ISEQ index 
in terms of comparison of growth in 
adjusted earnings per share and if there 
has been growth in the adjusted earnings 
per share of the Company equivalent to 
the increase in the Consumer Price Index 
plus 10%, compound, per annum in that 
period.

Directors are encouraged to hold their 
options beyond the earliest exercise 
date.

Details as at 31 March 2008 of the 
executive Directors’ and the Company 
Secretary’s options to subscribe 
for shares under the DCC plc 1998 
Employee Share Option Scheme are set 
out in the table below.

On 19 May 2008, Tommy Breen, Fergal 
O’Dwyer, Jim Flavin and the Company 
Secretary, Gerard Whyte, exercised 
options over 40,000 shares, 40,000 
shares, 200,000 shares and 14,000 
shares respectively, at prices ranging 
from €8.13 to €8.19 per share.

On 20 May 2008, Tommy Breen, Fergal 
O’Dwyer and the Company Secretary, 
Gerard Whyte, were granted options 
over 20,000 shares, 15,000 shares and 
10,000 shares respectively, at a price of 
€15.68 per share.

At 31 
March 
2007 

Granted  Exercised 
in year 

in year 

  Weighted
average 
option  
 price at 
March  31 March  
2008  
 € 

At 31 

2008 

  Option price 

Normal Exercise 
Period 

of options  Market price
exercised 
at date of 
exercise 
in year 
€
€ 

Executive Directors
Tommy Breen 
Basic tier   
Second tier 

205,000 
190,000 

40,000 
- 

Fergal O’Dwyer 
Basic tier   
Second tier 

175,000 
165,000 

22,500 
- 

- 
- 

- 
- 

245,000 
190,000 

12.2273  June 2001 - July 2017 
8.6786  June 2003 - Nov 2012 

197,500 
165,000 

11.3413  June 2001 - July 2017 
8.4366  June 2003 - Nov 2012 

- 
- 

- 
- 

-
-

-
-

Jim Flavin 
Basic tier   
Second tier 

Company Secretary 
Gerard Whyte 
Basic tier   
Second tier 

400,000 
395,000 

70,000 
- 

41,584 
- 

428,416 
395,000 

11.5616   June 2001 - July 2017 
8.1063  June 2003 - Nov 2012 

6.22 
- 

17.04
-

90,000 
80,000 

10,000 
- 

- 
- 

100,000 
80,000 

12.0466  June 2001 - July 2017 
8.8716  June 2003 - Nov 2012 

- 
- 

-
-

 
 
 
 
 
 
 
 
 
 
  
  
 
  
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

53

Report on Directors’ Remuneration and Interests (continued)

DCC Sharesave Scheme 
The Group established the DCC Sharesave Scheme in 2000. On 15 June 2001, options were granted under the Scheme to those 
Group employees, including executive Directors, who entered into associated savings contracts. The options were granted at an 
option price of €8.79 per share, which represented a discount of 20% to the then market price as provided for by the rules of the 
Scheme. There are no options outstanding under the June 2001 grant. On 10 December 2004, a second grant of options under 
this Scheme was made to Group employees, not including executive Directors, at an option price of €12.63 per share, which 
represented a discount of 20% to the then market price. These options are exercisable between December 2007 and March 2011. 
At 31 March 2008, Group employees held options to subscribe for 328,679 ordinary shares under the DCC Sharesave Scheme.

Details of the executive Directors’ and the Company Secretary’s options to subscribe for shares under the DCC Sharesave Scheme 
are set out below:

Executive Directors
Tommy Breen 
Fergal O’Dwyer 
Jim Flavin 

Company Secretary
Gerard Whyte 

No. of Ordinary Shares 
At 31 March 2008  

No. of Ordinary Shares
At 31 March 2007

- 
- 
- 

  815 

-
-
-

815

The market price of DCC shares on 31 March 2008 was €14.95 and the range during the year was €14.78 to €26.48.

Additional information in relation to the DCC plc 1998 Employee Share Option Scheme and the DCC Sharesave Scheme appears in 
note 10 on page 79. 

Directors’ and Company Secretary’s interests
The interests of the Directors and the Company Secretary (including their respective family interests) in the share capital of DCC plc 
at 4 June 2008 and 31 March 2008 (together with their interests at 31 March 2007) were:

No. of Ordinary Shares 
At 4 June 20081 

No. of Ordinary Shares 
At 31 March 2008 

No. of Ordinary Shares
At 31 March 2007

Directors 
Michael Buckley 
Tommy Breen 
Tony Barry 
Róisín Brennan 
Jim Flavin2 
Paddy Gallagher 
Maurice Keane 
Fergal O’Dwyer 
Bernard Somers 

Company Secretary 
Gerard Whyte  

10,000 
254,395 
17,000 
- 
  2,700,000 
5,040 
5,000 
254,889 
1,000 

10,000 
214,395 
17,000 
- 
2,500,000 
5,040 
5,000 
214,889 
1,000 

10,000
213,895
17,000
-
2,458,416
5,040
5,000
214,889
-

140,544 

126,544 

126,544

Notes
1    On 19 May 2008, Tommy Breen, Fergal O’Dwyer, Jim Flavin and the Company Secretary, Gerard Whyte acquired additional 
interests in DCC plc following the exercise of share options over 40,000 shares, 40,000 shares, 200,000 shares and 14,000 
shares respectively.

2   Jim Flavin resigned as a Director on 27 May 2008.

All of the above interests were beneficially owned. 

Apart from the interests disclosed above, the Directors and the Company Secretary had no interests in the share capital or loan 
stock of the Company or any other Group undertaking at 31 March 2008.

The Company’s Register of Directors Interests (which is open to inspection) contains full details of Directors’ shareholdings and 
share options. 

Directors’ service agreements
There are no service agreements between any Director of the Company and the Company or any of its subsidiaries. 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
54

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Statement of Directors’ Responsibilities

The following statement, which should be 
read in conjunction with the statement of 
Directors’ and Auditors’ responsibilities 
set out within their report on page 55, 
is made with a view to distinguishing 
for shareholders the respective 
responsibilities of the Directors and of 
the Auditors in relation to the financial 
statements.

The Directors are responsible for 
preparing the Annual Report and the 
financial statements in accordance with 
applicable law and regulations.

Company law requires the Directors 
to prepare financial statements for 
each financial year. Under that law the 
Directors have prepared the Group and 
Parent Company financial statements in 
accordance with International Financial 
Reporting Standards (IFRSs) as adopted 
by the European Union. The financial 
statements are required by law to give a 
true and fair view of the state of affairs of 
the Company and the Group and of the 
profit or loss of the Group for that period.

In preparing these financial statements, 
the Directors are required to:

•   select suitable accounting policies and 

then apply them consistently;

•   make judgments and estimates that 

are reasonable and prudent;

•   state that the financial statements 
comply with applicable IFRS as 
adopted by the European Union; and

•   prepare the financial statements on 
the going concern basis unless it is 
inappropriate to presume that the 
Group will continue in business, in 
which case there should be supporting 
assumptions or qualifications as 
necessary.

The Directors are also required by the 
Transparency (Directive 2004/109/EC) 
Regulations 2007 and the Interim 

Transparency Rules of the Irish Financial 
Services Regulatory Authority to include 
a management report containing a fair 
review of the business and a description 
of the principal risks and uncertainties 
facing the Company and Group.

The Directors are responsible for keeping 
proper books of account that disclose 
with reasonable accuracy at any time the 
financial position of the Company and the 
Group and to enable them to ensure that 
the financial statements comply with the 
Companies Acts, 1963 to 2006 and, as 
regards the Group financial statements, 
Article 4 of the IAS Regulation. They are 
also responsible for safeguarding the 
assets of the Company and the Group 
and hence for taking reasonable steps for 
the prevention and detection of fraud and 
other irregularities. 

The Directors are responsible for 
the maintenance and integrity of the 
website. Legislation in the Republic of 
Ireland concerning the preparation and 
dissemination of financial statements may 
differ from legislation in other jurisdictions.

Directors’ statement pursuant to the 
Transparency (Directive 2004/109/EC) 
Regulations 2007

The Directors confirm that, to the best of 
each person’s knowledge and belief:

•   the financial statements, prepared in 
accordance with IFRSs as adopted 
by the European Union, give a true 
and fair view of the assets, liabilities, 
financial position and profit of the 
Company and Group; and

•   the Report of the Directors includes 
a fair review of the development and 
performance of the Group’s business 
and the state of affairs of the business 
at 31 March 2008, together with a 
description of the principal risks and 
uncertainties facing the Group.

On behalf of the Board

Michael Buckley, Tommy Breen, Directors

Report of the Independent Auditors
for the year ended 31 March 2008

To the Members of DCC plc
We have audited the Group and Parent 
Company financial statements (the 
‘financial statements’) of DCC plc for 
the year ended 31 March 2008 which 
comprise the Group Income Statement, 
the Group and Parent Company 
Balance Sheets, the Group and Parent 
Company Cash Flow Statements, the 
Group and Parent Company Statement 
of Recognised Income and Expense 
and the related notes. These financial 
statements have been prepared under 
the accounting policies set out therein. 

Respective responsibilities of 
Directors and Auditors
The Directors’ responsibilities for 
preparing the Annual Report and the 
financial statements in accordance with 
applicable law and International Financial 
Reporting Standards (IFRSs) as adopted 
by the European Union, are set out in the 
Statement of Directors’ Responsibilities.

Our responsibility is to audit the financial 
statements in accordance with relevant 
legal and regulatory requirements and 
International Standards on Auditing 
(UK and Ireland). This report, including 
the opinion, has been prepared for and 
only for the Company’s members as a 
body in accordance with Section 193 
of the Companies Act, 1990 and for no 
other purpose. We do not, in giving this 
opinion, accept or assume responsibility 
for any other purpose or to any other 
person to whom this report is shown 
or into whose hands it may come save 
where expressly agreed by our prior 
consent in writing.

We report to you our opinion as to 
whether the Group financial statements 
give a true and fair view, in accordance 
with IFRSs as adopted by the European 
Union. We report to you our opinion as 
to whether the Parent Company financial 
statements give a true and fair view, 
in accordance with IFRSs as adopted 
by the European Union, as applied 
in accordance with the provisions of 
the Companies Acts, 1963 to 2006. 

We also report to you whether the 
financial statements have been properly 
prepared in accordance with Irish statute 
comprising the Companies Acts, 1963 to 
2006 and Article 4 of the IAS Regulation. 
We state whether we have obtained all 
the information and explanations we 
consider necessary for the purposes 
of our audit, and whether the financial 
statements are in agreement with the 
books of account. We also report to you 
our opinion as to: 

•   whether the Company has kept 

proper books of account;

•   whether the Directors’ Report 
is consistent with the financial 
statements; and 

•   whether at the balance sheet date 
there existed a financial situation 
which may require the Company to 
convene an extraordinary general 
meeting of the Company; such a 
financial situation may exist if the net 
assets of the Company, as stated in 
the Company Balance Sheet, are not 
more than half of its called-up share 
capital.

We also report to you if, in our opinion, 
any information specified by law or the 
Listing Rules of the Irish Stock Exchange 
regarding Directors’ remuneration and 
Directors’ transactions is not disclosed 
and, where practicable, include such 
information in our report.

We review whether the Corporate 
Governance statement reflects the 
Company’s compliance with the nine 
provisions of the Financial Reporting 
Council’s 2006 Combined Code 
specified for our review by the Listing 
Rules of the Irish Stock Exchange, and 
we report if it does not. We are not 
required to consider whether the Board’s 
statements on internal control cover all 
risks and controls, or form an opinion 
on the effectiveness of the Group’s 
corporate governance procedures or its 
risk and control procedures.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

55

We read the other information 
contained in the Annual Report and 
consider whether it is consistent with 
the audited financial statements. The 
other information comprises only 
the Chairman’s Statement, the Chief 
Executive’s Review, the Business 
Review, Financial Review, the Corporate 
Social Responsibility Statement, the 
Corporate Governance Statement, the 
Report on Directors’ Remuneration and 
Interests and the Directors’ Report. We 
consider the implications for our report 
if we become aware of any apparent 
misstatements or material inconsistencies 
with the financial statements. Our 
responsibilities do not extend to any other 
information.

Basis of audit opinion
We conducted our audit in accordance 
with International Standards on Auditing 
(UK and Ireland) issued by the Auditing 
Practices Board. An audit includes 
examination, on a test basis, of evidence 
relevant to the amounts and disclosures 
in the financial statements. It also 
includes an assessment of the significant 
estimates and judgments made by 
the Directors in the preparation of the 
financial statements, and of whether 
the accounting policies are appropriate 
to the Group’s and Company’s 
circumstances, consistently applied and 
adequately disclosed.

We planned and performed our audit 
so as to obtain all the information and 
explanations which we considered 
necessary in order to provide us with 
sufficient evidence to give reasonable 
assurance that the financial statements 
are free from material misstatement, 
whether caused by fraud or other 
irregularity or error. In forming our 
opinion we also evaluated the overall 
adequacy of the presentation of 
information in the financial statements.

56

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Report of the Independent Auditors
for the year ended 31 March 2008 (continued)

The net assets of the Company, as stated 
in the Company Balance Sheet are more 
than half of the amount of its called-
up share capital and, in our opinion, 
on that basis there did not exist at 31 
March 2008 a financial situation which 
under Section 40 (1) of the Companies 
(Amendment) Act, 1983 would require 
the convening of an extraordinary general 
meeting of the Company.

PricewaterhouseCoopers
Chartered Accountants and  
Registered Auditors
Dublin
9 June 2008

Opinion
In our opinion:

•   the Group financial statements give a 
true and fair view, in accordance with 
IFRSs as adopted by the European 
Union, of the state of the Group’s 
affairs as at 31 March 2008 and of its 
profit and cash flows for the year then 
ended;

•   the Parent Company financial 

statements give a true and fair view, 
in accordance with IFRSs as adopted 
by the European Union as applied in 
accordance with the provisions of the 
Companies Acts, 1963 to 2006, of the 
state of the Parent Company’s affairs 
as at 31 March 2008 and cash flows 
for the year then ended; and

•   the financial statements have been 

properly prepared in accordance with 
the Companies Acts, 1963 to 2006 
and Article 4 of the IAS Regulation.

We have obtained all the information 
and explanations which we consider 
necessary for the purposes of our audit. 
In our opinion proper books of account 
have been kept by the Company. The 
Company Balance Sheet is in agreement 
with the books of account.

In our opinion the information given in the 
Directors’ Report is consistent with the 
financial statements.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

57

Group Income Statement
for the year ended 31 March 2008

Revenue 
Cost of sales 
Gross profit 
Administration expenses 
Selling and distribution expenses 
Other operating income  
Other operating expenses  
Operating profit before 
amortisation of intangible assets 
Amortisation of intangible assets 
Operating profit 
Finance costs 
Finance income 
Share of associates’ profit after tax 
Profit before tax 
Income tax expense  

Note 

4 

 5 
 5 

4 
4 

12 
12 
14 

15 

2008 

Pre 

Exceptionals 

exceptionals 
€’000 

(note 11) 
€’000 

2007

Pre 

Exceptionals

Total 
€’000 

exceptionals 
€’000 

(note 11) 
€’000 

Total 
€’000

5,531,962 
(4,940,247) 
591,715 
(205,118) 
(230,470) 
14,564 
(3,511) 

167,180 
(7,928) 
159,252 
(44,912) 
27,120 
639 
142,099 
(14,774) 

- 
- 
- 
- 
- 
94,763 
(55,158) 

39,605 
- 
39,605 
- 
- 
- 
39,605 
(1,756) 

5,531,962 
(4,940,247) 
591,715 
(205,118) 
(230,470) 
109,327 
(58,669) 

4,046,118  
(3,544,403) 
501,715 
(181,363) 
(186,599) 
8,212 
(1,881) 

206,785 
(7,928) 
198,857 
(44,912) 
27,120 
639 
181,704 
(16,530) 

140,084 
(6,660) 
133,424 
(31,338) 
20,488 
14,710 
137,284 
(12,995) 

- 
- 
- 
- 
- 
33,199 
(8,683) 

24,516 
- 
24,516 
- 
- 
- 
24,516 
(7,700) 

4,046,118
(3,544,403)
501,715
(181,363)
(186,599)
41,411
(10,564)

164,600
(6,660)
157,940
(31,338)
20,488
14,710
161,800
(20,695)

Profit after tax for the financial year   

127,325 

37,849 

165,174 

124,289 

16,816 

141,105

Profit attributable to:
Equity holders of the Company 
Minority interest 

Earnings per ordinary share
Basic 

Diluted 

18 

18 

Michael Buckley, Tommy Breen, Directors

164,491 
683 
165,174 

204.28c 

200.31c 

140,186
919
141,105

174.59c

170.83c

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
58

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Group Statement of Recognised Income and Expense 
for the year ended 31 March 2008

Items of income and expense recognised directly within equity: 
Currency translation effects 
Group defined benefit pension obligations: 
- actuarial (loss)/gain 
- movement in deferred tax asset 
Deferred tax on share based payment 
Gains/(losses) relating to cash flow hedges (net) 
Movement in deferred tax liability on cash flow hedges 
Net (expense)/income recognised directly in equity 
Profit after tax for the financial year 

Note 

2008 
€’000 

2007
€’000

32 
15 
15 

15 

(64,310) 

7,430

(9,086) 
1,200 
25 
385 
(46) 
(71,832) 
165,174 

1,576
(169)
25
(159)
22
8,725
141,105

Total recognised income and expense for the financial year 

93,342 

149,830

Attributable to: 
Equity holders of the Company 
Minority interest 
Total recognised income and expense for the financial year 

92,659 
683 
93,342 

148,911
919
149,830

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Balance Sheet
as at 31 March 2008

ASSETS 
Non-current assets 
Property, plant and equipment 
Intangible assets 
Investments in associates 
Deferred income tax assets 
Derivative financial instruments 

Current assets 
Inventories 
Trade and other receivables 
Derivative financial instruments 
Cash and cash equivalents 

Total assets 

EQUITY 
Capital and reserves attributable to equity holders of the Company
Equity share capital 
Share premium account 
Other reserves - share options 
Cash flow hedge reserve 
Foreign currency translation reserve 
Other reserves 
Retained earnings 

Minority interest 
Total equity 

LIABILITIES
Non-current liabilities 
Borrowings 
Derivative financial instruments 
Deferred income tax liabilities 
Retirement benefit obligations 
Provisions for liabilities and charges 
Deferred acquisition consideration 
Government grants 

Current liabilities 
Trade and other payables 
Current income tax liabilities 
Borrowings 
Derivative financial instruments 
Provisions for liabilities and charges 
Deferred acquisition consideration 

Total liabilities 
Total equity and liabilities 

 Michael Buckley, Tommy Breen, Directors

DCC - ANNUAL REPORT AND ACCOUNTS 2008

59

Note 

19 
20 
21 
31 
28 

23 
24 
28 
27 

36 
37 
38 
38 
38 
38 
39 

40 
41 

29 
28 
31 
32 
34 
33 
35 

25 

29 
28 
34 
33 

2008 
€’000 

337,058 
416,883 
4,678 
10,199 
25,347 
794,165 

219,752 
807,433 
1,523 
485,840 
1,514,548 
2,308,713 

22,057 
124,687 
6,651 
222 
(67,224) 
1,400 
650,871 
738,664 
3,771 
742,435 

358,119 
43,558 
11,706 
21,851 
5,399 
16,155 
1,941 
458,729 

796,902 
53,895 
217,546 
17,206 
7,964 
14,036 
1,107,549 
1,566,278 
2,308,713 

2007
€’000

319,621
321,369
90,332
8,305
3,091
742,718

177,450
597,257
51
337,079
1,111,837
1,854,555

22,057
124,687
4,807
(117)
(2,914)
1,400
531,994
681,914
5,816
687,730

268,579
45,944
14,748
16,372
6,122
18,523
2,393
372,681

601,404
50,849
125,978
236
4,807
10,870
794,144
1,166,825
1,854,555

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Group Cash Flow Statement
for the year ended 31 March 2008

Cash generated from operations 
Exceptionals 
Interest paid 
Income tax paid 
Net cash flows from operating activities 

Investing activities
Inflows
Dividends received from associates 
Proceeds from disposal of property, plant and equipment  
Government grants received 
Proceeds on disposal of associate 
Interest received 

Outflows
Purchase of property, plant and equipment 
Acquisition of subsidiaries  
Purchase of minority interests 
Deferred acquisition consideration paid 

Net cash flows from investing activities 

Financing activities
Inflows
Proceeds from issue of shares 
Increase in finance lease liabilities 
Increase in interest-bearing loans and borrowings 

Outflows
Share buyback 
Repayment of interest-bearing loans and borrowings 
Repayment of finance lease liabilities 
Dividends paid to equity holders of the Company 
Dividends paid to minority interests 

Net cash flows from financing activities 

Change in cash and cash equivalents 
Translation adjustment 
Cash and cash equivalents at beginning of year 
Cash and cash equivalents at end of year 

Cash and cash equivalents consists of:
Cash and short term bank deposits 
Overdrafts 

Note 

42 

35 

17 
40 

30 

27 
30 
30 

2008 
€’000 

2007
€’000

129,043 
(4,168) 
(38,541) 
(21,902) 
64,432 

127,421
(4,916)
(29,331)
(10,058)
83,116

172,000 
7,781 
92 
8,880 
23,560 
212,313 

(87,526) 
(166,584) 
- 
(9,987) 
(264,097) 
(51,784) 

4,060 
873 
202,049 
206,982 

- 
(43,490) 
(6,523) 
(41,813) 
(2,725) 
(94,551) 
112,431 

125,079 
(39,220) 
310,187 
396,046 

-
44,394
-
- 
20,211
64,605

(60,651)
(100,213)
(1,276)
(4,176)
(166,316)
(101,711)

6,098
3,545
56,303
65,946

(18,818)
(1,240)
(4,801)
(36,381)
(38)
(61,278)
4,668

(13,927)
4,196
319,918
310,187

485,840 
(89,794) 
396,046 

337,079
(26,892)
310,187

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Company Balance Sheet
as at 31 March 2008

ASSETS 
Non-current assets
Investments in associates 
Investments in subsidiary undertakings 

Current assets 
Trade and other receivables 
Cash and cash equivalents 

Total assets 

EQUITY
Capital and reserves attributable to equity holders of the Company
Equity share capital 
Share premium account 
Other reserves 
Retained earnings 
Total equity 

LIABILITIES
Non-current liabilities
Amounts due to subsidiary undertakings   

Current liabilities
Trade and other payables 

Total liabilities 
Total equity and liabilities 

Michael Buckley, Tommy Breen, Directors 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

61

Note 

21 
22 

24 
27 

36 
37 
38 
39 
41 

25 

2008 
€’000 

1,244 
161,065 
162,309 

494,630 
2,664 
497,294 
659,603 

22,057 
124,687 
344 
230,285 
377,373 

10,387 
10,387 

271,843 
271,843 
282,230 
659,603 

2007
€’000

1,300
161,065
162,365

296,303
8
296,311
458,676

22,057
124,687
344
46,758
193,846

10,387
10,387

254,443
254,443
264,830
458,676

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
62

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Company Statement of Recognised Income and Expense 
for the year ended 31 March 2008

Profit after tax for the financial year 
Total recognised income and expense for the financial year 

Attributable to:
Equity holders of the Company 

Company Cash Flow Statement
for the year ended 31 March 2008

Cash generated from operations 
Interest paid 
Income tax (paid)/received 
Net cash flows from operating activities 

Investing activities
Inflows 
Proceeds on disposal of associate 
Interest received 

Outflows 
Capital contribution to subsidiary undertaking 

Net cash flows from investing activities 

Financing activities 
Inflows 
Proceeds from issue of shares 

Outflows 
Share buyback 
Dividends paid to equity holders of the Company 

Net cash flows from financing activities 

Change in cash and cash equivalents 
Cash and cash equivalents at beginning of year 
Cash and cash equivalents at end of year 

Note 

16 

2008 
€’000 

221,280 
221,280 

2007
€’000

40,303
40,303

221,280 

40,303

Note 

42 

39 
17 

2008 
€’000 

46,156 
(1,868) 
(1,750) 
42,538 

8,880 
4,991 
13,871 

(16,000) 
(16,000) 
(2,129) 

4,060 
4,060 

- 
(41,813) 
(41,813) 
(37,753) 

2,656 
8 
2,664 

2007
€’000

44,219
(1,199)
1,319
44,339

- 
4,613
4,613

-
-
4,613

6,098
6,098

(18,818)
(36,381)
(55,199)
(49,101)

(149)
157
8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements

DCC - ANNUAL REPORT AND ACCOUNTS 2008

63

1. Summary of significant accounting policies
Statement of compliance 
The consolidated financial statements of DCC plc have been prepared in accordance with International Financial Reporting Standards (IFRSs) 
and their interpretations approved by the International Accounting Standards Board (IASB) as adopted by the European Union (EU) and those 
parts of the Companies Acts, 1963 to 2006 applicable to companies reporting under IFRS. Both the Parent Company and the Group financial 
statements have been prepared in accordance with IFRS as adopted by the EU. In presenting the Parent Company financial statements 
together with the Group financial statements, the Company has availed of the exemption in Section 148(8) of the Companies Act 1963 not to 
present its individual Income Statement and related notes that form part of the approved Company financial statements. The Company has 
also availed of the exemption from filing its individual Income Statement with the Registrar of Companies as permitted by Section 7(1A) of the 
Companies (Amendment) Act 1986.

Basis of preparation
The consolidated financial statements, which are presented in euro, rounded to the nearest thousand, have been prepared under the 
historical cost convention, as modified by the measurement at fair value of share options and derivative financial instruments. The carrying 
values of recognised assets and liabilities that are hedged are adjusted to record changes in the fair values attributable to the risks that are 
being hedged.

In the current year, the Group has adopted IFRS 7 Financial Instruments: Disclosures, which is effective for annual reporting periods 
beginning on or after 1 January 2007, and the consequential amendment to IAS 1 Presentation of Financial Statements - Capital 
Disclosures. The impact of the adoption of IFRS 7 and the change to IAS 1 has been to expand the disclosures provided in these financial 
statements regarding the Group’s financial instruments and management of capital.

The accounting policies applied in the preparation of the financial statements for the year ended 31 March 2008 are set out below. These 
policies have been applied consistently by the Group’s subsidiaries, joint ventures and associates for all periods presented in these 
consolidated financial statements.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. In addition, it 
requires management to exercise judgment in the process of applying the Company’s accounting policies. The areas involving a high 
degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are 
documented in the relevant accounting policies below.

Standards, interpretations and amendments to published standards that are not yet effective 
The Group has not applied certain new standards, amendments and interpretations to existing standards that have been issued but are 
not yet effective. These include the following:

• 

• 

• 

• 

• 

• 

 Amendment to IFRS 2 Share-based Payments: Vesting Conditions and Cancellations (effective date: DCC financial year beginning 1 April 
2009). This amendment clarifies the accounting treatment of cancellations and vesting conditions. This amendment will have no impact on 
the Group’s accounts.

 IFRS 3 Revised Business Combinations (effective date: DCC financial year beginning 1 April 2010). This standard establishes principles for 
how an acquirer recognises, measures and discloses in its financial statements the goodwill acquired in the business combination and the 
identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquiree. The impact on the Group’s accounts 
will be dependent on future acquisitions.

 IFRS 8 Operating Segments (effective date: DCC financial year beginning 1 April 2009). IFRS 8 replaces IAS 14 and uses a ‘management 
approach’ under which segment information is presented on the same basis as that used for internal reporting purposes. Whilst the 
application of IFRS 8 will result in amendments to the segment information note, this amendment will not be of a recognition and 
measurement nature.

 Amendment to IAS 1 Presentation of Financial Statements (Revised) (effective date: DCC financial year beginning 1 April 2009). This 
amendment sets overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements 
for their content. IAS 1 will have an impact on the presentation of the financial statements of the Group, however, this is not expected to 
be significant.

 Amendment to IAS 23 Borrowing Costs (effective date: DCC financial year beginning 1 April 2009). This amendment requires an entity to 
capitalise borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset, as part of the 
cost of that asset. This amendment will not have a material effect on the Group’s financial statements.

 Amendment to IAS 27 Consolidated and Separate Financial Statements (effective date: DCC financial year beginning 1 April 2010). The 
objective of this amendment is to enhance the relevance, reliability and comparability of the information that a parent entity provides in its 
separate financial statements and in its consolidated financial statements for a group of entities under its control. The introduction of this 
amendment will impact on Group reporting but this is not expected to be significant.

64

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

1. Summary of significant accounting policies - continued
• 

 Amendment to IAS 32 Puttable Financial Instruments and Obligations Arising on Liquidation (effective date: DCC financial year beginning 
1 April 2009). This amendment will have no effect on the Group’s financial statements.

• 

• 

• 

 IFRIC Interpretation 12 Service Concession Arrangements (effective date: DCC financial year beginning 1 April 2008). This interpretation 
gives guidance on the accounting by operators for public-to-private service concession arrangements. This IFRIC will have no effect on 
the Group’s financial statements.

 IFRIC Interpretation 13 Customer Loyalty Programmes (effective date: DCC financial year beginning 1 April 2009). This interpretation gives 
guidance on accounting for customer loyalty award credits. This IFRIC will not have a material effect on the Group’s financial statements.

 IFRIC Interpretation 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction (effective date: 
DCC financial year beginning 1 April 2008). This interpretation deals with accounting for refunds in contributions and minimum funding 
requirements. This IFRIC will only be of relevance to the Group where surpluses emerge on the Group’s defined benefit pension schemes 
and those surpluses are of a sufficient magnitude to warrant application of the surplus cap.

Comparative amounts
It had been DCC’s policy to allocate Group central costs against operating profit and against the share of profit after tax of associates. In 
the current year, DCC has allocated all Group central costs against operating profit. For consistency, the comparative divisional operating 
profit and total operating profit and share of profit after tax of associates for the year ended 31 March 2007 have been amended to reflect 
the accounting approach adopted in the current year. As a result the comparative operating profit has been reduced by €2.9 million and the 
Group’s share of profit after tax of associates has been increased by €2.9 million. This adjustment has no impact on the profit before tax or 
earnings per share previously reported for the year ended 31 March 2007. 

Basis of consolidation
Subsidiaries
Subsidiaries are entities that are directly or indirectly controlled by the Group. Control exists where the Group has the power to govern the 
financial and operating policies of the entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are 
currently exercisable or convertible are taken into account.

The results of subsidiary undertakings acquired or disposed of during the year are included in the Group Income Statement from the date of 
their acquisition or up to the date of their disposal. Where necessary, adjustments are made to the financial statements of subsidiaries to bring 
their accounting policies into line with those used by the Group.

Joint ventures 
In accordance with IAS 31 Interests in Joint Ventures, the Group’s share of results and net assets of joint ventures, which are entities in which 
the Group holds an interest on a long-term basis and which are jointly controlled by the Group and one or more other venturers under a 
contractual arrangement, are accounted for on the basis of proportionate consolidation from the date on which the contractual agreements 
stipulating joint control are finalised and are derecognised when joint control ceases. All of the Group’s joint ventures are jointly controlled 
entities within the meaning of IAS 31. The Group combines its share of the joint ventures’ individual income and expenses, assets and 
liabilities and cash flows on a line-by-line basis with similar items in the Group’s financial statements.

Associates
Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 
20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting and are initially 
recognised at cost. The Group’s investment in associates includes goodwill identified on acquisition, net of any accumulated impairment loss. 
Goodwill attributable to investments in associates is treated in accordance with the accounting policy for goodwill.

The Group’s share of its associates’ post-acquisition profits or losses is recognised in the Group Income Statement, and its share of post-
acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying 
amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any 
other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of 
the associate.

The results of associates are included from the effective date on which the Group obtains significant influence and are excluded from the 
effective date on which the Group ceases to have significant influence.

Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised gains arising from such transactions, are eliminated in preparing the consolidated 
financial statements. Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the Group’s 
interest in the entity. Unrealised losses are eliminated in the same manner as unrealised gains, but only to the extent that there is no evidence 
of impairment.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

65

Notes to the Financial Statements (continued)

1. Summary of significant accounting policies - continued
Revenue recognition
Revenue comprises the fair value of the sale of goods and services to external customers net of value added tax, rebates and discounts. 
Revenue from the sale of goods is recognised when significant risks and rewards of ownership of the goods are transferred to the buyer, 
which generally arises on delivery, or in accordance with specific terms and conditions agreed with customers. Revenue from the rendering of 
services is recognised in the period in which the services are rendered. 

Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable.

Dividend income from investments is recognised when shareholders’ rights to receive payment have been established.

Segment reporting 
A segment is a distinguishable component of the Group that is engaged either in providing products or services (business segment), or in 
providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that 
are different from those other segments. Arising from the Group’s internal organisational structure and its system of internal financial reporting, 
segmentation by business is regarded as being the predominant source and nature of the risks and returns facing the Group and is thus the 
primary segment. Geographical segmentation is the secondary segment.

Foreign currency translation
Functional and presentation currency
The consolidated financial statements are presented in euro which is the Company’s functional and the Group’s presentation currency. Items 
included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in 
which the entity operates. 

Transactions and balances 
Transactions in foreign currencies are recorded at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities 
denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. Currency translation differences 
on monetary assets and liabilities are taken to the Group Income Statement except when cash flow and net investment hedge accounting is 
applied. 

Group companies
Results and cash flows of subsidiaries, joint ventures and associates which do not have the euro as their functional currency are translated 
into euro at average exchange rates for the year. Average exchange rates are a reasonable approximation of the cumulative effect of the rates 
on the transaction dates. The related balance sheets are translated at the rates of exchange ruling at the balance sheet date. Adjustments 
arising on translation of the results of such subsidiaries, joint ventures and associates at average rates, and on the restatement of the opening 
net assets at closing rates, are dealt with in a separate translation reserve within equity, net of differences on related currency instruments 
designated as hedges of such investments.

On disposal of a foreign operation, such cumulative currency translation differences are recognised in the Income Statement as part of the 
overall gain or loss on disposal. In accordance with IFRS 1, cumulative currency translation differences arising prior to the transition date to 
IFRS (1 April 2004) have been set to zero for the purposes of ascertaining the gain or loss on disposal of a foreign operation. 

Goodwill and fair value adjustments arising on acquisition of a foreign operation are regarded as assets and liabilities of the foreign operation, 
are expressed in the functional currency of the foreign operation and are recorded at the exchange rate at the date of the transaction and 
subsequently retranslated at the applicable closing rates.

Exceptional items
The Group has adopted an Income Statement format which seeks to highlight significant items within the Group results for the year. Such 
items may include restructuring, profit or loss on disposal or termination of operations, litigation costs and settlements, profit or loss on 
disposal of investments, profit or loss on disposal of property, plant and equipment and impairment of assets. Judgment is used by the Group 
in assessing the particular items, which by virtue of their scale and nature, should be disclosed in the Income Statement and related notes as 
exceptional items.

Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Depreciation is provided 
on a straight-line basis at the rates stated below, which are estimated to reduce each item of property, plant and equipment to its residual 
value level by the end of its useful life:

Freehold and long term leasehold buildings 
Plant and machinery  
Cylinders 
Motor vehicles 
Fixtures, fittings & office equipment 

Annual Rate
2%
5 - 331/3%
62/3%
10 - 331/3%
10 - 331/3%

 
 
 
 
 
 
 
 
 
 
 
 
 
66

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

1. Summary of significant accounting policies - continued
Land is not depreciated. The residual values and useful lives of property, plant and equipment are reviewed, and adjusted if appropriate, at 
each balance sheet date.

In accordance with IAS 36 Impairment of Assets, the carrying amounts of items of property, plant and equipment are reviewed at each 
balance sheet date to determine whether there is any indication of impairment. An impairment loss is recognised whenever the carrying 
amount of an asset or its cash-generating unit exceeds its recoverable amount.

Impairment losses are recognised in the Income Statement. Following the recognition of an impairment loss, the depreciation charge 
applicable to the asset or cash-generating unit is adjusted prospectively in order to systematically allocate the revised carrying amount, net of 
any residual value, over the remaining useful life.

Subsequent costs are included in an asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that 
future economic benefits associated with the item will flow to the Group and the cost of the replaced item can be measured reliably. All other 
repair and maintenance costs are charged to the Income Statement during the financial period in which they are incurred. 

Borrowing costs directly attributable to the construction of property, plant and equipment are capitalised as part of the cost of those assets.

Business combinations
The purchase method of accounting is employed in accounting for the acquisition of subsidiaries by the Group. The Group elected to avail of 
the exemption under IFRS 1 First-time Adoption of International Financial Reporting Standards, whereby business combinations prior to the 
transition date of 1 April 2004 are not restated. IFRS 3 Business Combinations was therefore applied with effect from the transition date of 1 
April 2004 and goodwill amortisation ceased from that date.

The cost of a business combination is measured as the aggregate of the fair value at the date of exchange of assets given, liabilities incurred 
or assumed and equity instruments issued in exchange for control together with any directly attributable expenses. Where acquisitions involve 
further payments which are deferred or contingent on levels of performance achieved in the years following the acquisition, the fair value of the 
deferred component is determined through discounting the amounts payable to their present value. The discount component is unwound as 
an interest charge in the Income Statement over the life of the obligation. When the initial accounting for a business combination is determined 
provisionally, any adjustments to the provisional values allocated to assets and liabilities are made within twelve months of the acquisition date 
and reflected as a restatement of the acquisition balance sheet.

Minority interests
The interest of minority shareholders is stated at the minority’s proportion of the fair values of the assets and liabilities recognised. 
Subsequently, any losses applicable to the minority interest in excess of the minority interest are allocated against interests of the parent.

The Group applies a policy of treating transactions with minority interests as transactions with parties external to the Group. Disposals to 
minority interests result in gains and losses for the Group that are recorded in the Income Statement. Purchases from minority interests result 
in goodwill, being the difference between any consideration paid and the relevant share acquired of the carrying value of the net assets of the 
subsidiary.

Goodwill
Goodwill arising in respect of acquisitions completed prior to 1 April 2004 (being the transition date to IFRS) is included at its carrying amount, 
which equates to its net book value recorded under previous GAAP. In accordance with IFRS 1, the accounting treatment of business 
combinations undertaken prior to the transition date (1 April 2004) was not reconsidered and goodwill amortisation ceased with effect from 
the transition date. 

Goodwill on acquisitions is initially measured at cost being the excess of the cost of the business combination over the acquirer’s interest 
in the net fair value of the identifiable assets, liabilities and contingent liabilities. Goodwill acquired in a business combination is allocated, 
from the acquisition date, to the cash-generating units or groups of cash-generating units that are expected to benefit from the business 
combination in which the goodwill arose.

Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment 
annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired.

The carrying amount of goodwill in respect of associates, net of any impairment, is included in investments in associates under the equity 
method in the Group Balance Sheet.

Goodwill is subject to impairment testing on an annual basis and at any time during the year if an indicator of impairment is considered to 
exist; the goodwill impairment tests are undertaken at a consistent time in each annual period. Impairment is determined by assessing the 
recoverable amount of the cash-generating unit to which the goodwill relates. Where the recoverable amount of the cash-generating unit is 
less than the carrying amount, an impairment loss is recognised. Impairment losses arising in respect of goodwill are not reversed following 
recognition.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

67

Notes to the Financial Statements (continued)

1. Summary of significant accounting policies - continued
Where a subsidiary is sold, any goodwill arising on acquisition, net of any impairments, is included in determining the profit or loss arising on 
disposal. 

Where goodwill forms part of a cash-generating unit and part of the operations within that unit are disposed of, the goodwill associated with 
the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. 
Goodwill disposed of in this circumstance is measured on the basis of the relative values of the operation disposed of and the proportion of 
the cash-generating unit retained.

Intangible assets (other than goodwill)
Intangible assets acquired separately are capitalised at cost. Intangible assets acquired in the course of a business combination are 
capitalised at fair value being their deemed cost as at the date of acquisition. 

Following initial recognition, intangible assets which have a finite life are carried at cost less any applicable accumulated amortisation and any 
accumulated impairment losses. Where amortisation is charged on assets with finite lives this expense is taken to the Income Statement.

The amortisation of intangible assets is calculated to write-off the book value of intangible assets over their useful lives on a straight-line basis 
on the assumption of zero residual value. In general, definite-lived intangible assets are amortised over periods ranging from two to five years, 
depending on the nature of the intangible asset.

The carrying amount of definite-lived intangible assets are reviewed for indicators of impairment at each reporting date and are subject to 
impairment testing when events or changes in circumstances indicate that the carrying values may not be recoverable. For the purposes of 
assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership of the 
asset to the lessee. All other leases are classified as operating leases.

Assets held under finance leases are capitalised as assets of the Group at the inception of the lease at the lower of the fair value of the leased 
asset and the present value of the minimum lease payments. The corresponding liability to the lessor is included in the Balance Sheet as a 
short, medium or long term lease obligation as appropriate. Lease payments are apportioned between finance charges and reduction of the 
lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in the 
Income Statement.

Rentals payable under operating leases (net of any incentives received from the lessor) are charged to the Income Statement on a straight line 
basis over the term of the relevant lease. 

Inventories
Inventories are valued at the lower of cost and net realisable value.

Cost is determined on a first in first out basis and in the case of raw materials, bought-in goods and expense inventories comprises purchase 
price plus transport and handling costs less trade discounts and subsidies. Cost, in the case of products manufactured by the Group, 
consists of direct material and labour costs together with the relevant production overheads based on normal levels of activity. Net realisable 
value represents the estimated selling price less costs to completion and appropriate selling and distribution costs.

Provision is made, where necessary, for slow moving, obsolete and defective inventories.

Trade receivables
Trade and other receivables are stated at cost, which approximates to fair value given the short-dated nature of these assets less provision for 
impairment.

A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all 
amounts due according to the original terms of receivables. Significant financial difficulties of the debtor, probability that the debtor will enter 
bankruptcy or financial reorganisation, and default in payments are considered indicators that the trade receivable is impaired. The amount of 
the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows. The amount of the 
provision is recognised in the Income Statement.

Trade payables
Trade and other payables are initially recognised at fair value and subsequently measured at amortised cost, which approximates to fair value 
given the short-dated nature of these liabilities.

68

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

1. Summary of significant accounting policies - continued
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and short term deposits with an original maturity of three months or less. 

For the purpose of the Group Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as defined above net of 
bank overdrafts.

Derivative financial instruments 
The Group uses derivative financial instruments (principally interest rate, currency and cross currency interest rate swaps and forward foreign 
exchange and commodity contracts) to hedge its exposure to interest rate and foreign exchange risks and to changes in the prices of certain 
commodity products arising from operational, financing and investment activities.

Derivative financial instruments are recognised on inception at fair value, being the present value of estimated future cash flows. The method 
of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the 
item being hedged.

Hedging
For the purposes of hedge accounting, hedges are designated either as fair value hedges (which entail hedging the exposure to movements 
in the fair value of a recognised asset or liability or a firm commitment that are attributable to hedged risks) or cash flow hedges (which hedge 
exposure to fluctuations in future cash flows derived from a particular risk associated with a recognised asset or liability or a highly probable 
forecast transaction).

The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk 
management objectives and strategy for undertaking various hedging transactions. The Group also documents its assessment, both at hedge 
inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in 
fair values or cash flows of hedged items.

The fair values of various derivative instruments used for hedging purposes are disclosed in note 28 and the movements on the hedging 
reserve in shareholders’ equity are shown in note 38. The full fair value of a hedging derivative is classified as a non-current asset or liability 
if the remaining maturity of the hedged item is more than twelve months, and as a current asset or liability if the remaining maturity of the 
hedged item is less than twelve months.

Fair value hedge
In the case of fair value hedges which satisfy the conditions for hedge accounting, any gain or loss arising from the re-measurement of the fair 
value of the hedging instrument is reported in the Income Statement within ‘Finance Costs’. 

In addition, any gain or loss on the hedged item which is attributable to the hedged risk is adjusted against the carrying amount of the hedged 
item and reflected in the Income Statement within ‘Finance Costs’. 

If a hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of the hedged item is amortised to the 
Income Statement over the period to maturity.

Cash flow hedge
Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability or a highly 
probable forecasted transaction, the effective part of any gain or loss on the derivative financial instrument is recognised as a separate 
component of equity with the ineffective portion being reported in the Income Statement. When a forecast transaction results in the 
recognition of an asset or a liability, the cumulative gain or loss is removed from equity and included in the initial measurement of the asset or 
liability. Otherwise, the associated gains or losses that had previously been recognised in equity are transferred to the Income Statement in the 
same reporting period as the hedged transaction. 

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or 
loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the Income 
Statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately 
transferred to the Income Statement.

Interest-bearing loans and borrowings
All loans and borrowings are initially recorded at fair value, net of transaction costs incurred. Loans and borrowings are subsequently stated 
at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the Income 
Statement over the period of the borrowings using the effective interest method.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

69

Notes to the Financial Statements (continued)

1. Summary of significant accounting policies - continued
Provisions
A provision is recognised in the Balance Sheet when the Group has a present obligation (either legal or constructive) as a result of a past 
event, and it is probable that a transfer of economic benefits will be required to settle the obligation. Provisions are measured at the Directors’ 
best estimate of the expenditure required to settle the obligation at the balance sheet date and are discounted to present value where the 
effect is material. 

A provision for restructuring is recognised when the Group has approved a detailed and formal restructuring plan and announced its main 
provisions.

Provisions arising on business combinations are only recognised to the extent that they would have qualified for recognition in the financial 
statements of the acquiree prior to the acquisition.

A contingent liability is not recognised but is disclosed where the existence of the obligation will only be confirmed by future events or where it 
is not probable that an outflow of resources will be required to settle the obligation or where the amount of the obligation cannot be measured 
with reasonable reliability. Contingent assets are not recognised but are disclosed where an inflow of economic benefits is probable. 

Environmental provisions
The Group’s waste management and recycling activities are subject to various laws and regulations governing the protection of the 
environment. Full provision is made for the net present value of the Group’s estimated costs in relation to restoration liabilities at its landfill 
sites. The net present value of the estimated costs is capitalised as property, plant and equipment and the unwinding of the discount element 
on the restoration provision is reflected as a finance cost in the Income Statement.

Finance costs
Finance costs comprise interest payable on borrowings calculated using the effective interest rate method, gains and losses on hedging 
instruments that are recognised in the Income Statement and the unwinding of discounts on provisions. The interest expense component of 
finance lease payments is recognised in the Income Statement using the effective interest rate method. The finance cost on defined benefit 
pension scheme liabilities is recognised in the Income Statement in accordance with IAS 19.

Finance income
Interest income is recognised in the Income Statement as it accrues, using the effective interest method. The expected return on defined 
benefit pension scheme assets is recognised in the Income Statement in accordance with IAS 19. 

Income tax
Current tax
Current tax represents the expected tax payable or recoverable on the taxable profit for the year using tax rates enacted or substantively 
enacted at the balance sheet date and taking into account any adjustments stemming from prior years.

Deferred tax
Deferred tax is provided using the liability method on all temporary differences at the balance sheet date which is defined as the difference 
between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets and liabilities are not 
subject to discounting and are measured at the tax rates that are anticipated to apply in the year in which the asset is realised or the liability is 
settled.

Deferred tax liabilities are recognised for all taxable temporary differences with the exception of the following:
(i) 

 where the deferred tax liability arises from the initial recognition of goodwill or the initial recognition of an asset or a liability in a transaction 
that is not a business combination and affects neither the accounting profit nor the taxable profit or loss at the time of the transaction; and
 where, in respect of taxable temporary differences associated with investments in subsidiaries, joint ventures and associates, the timing of 
the reversal of the temporary difference is subject to control by the Group and it is probable that reversal will not occur in the foreseeable 
future.

(ii) 

Deferred tax assets are recognised in respect of all deductible temporary differences, carry-forward of unused tax credits and unused tax 
losses to the extent that it is probable that taxable profits will be available against which to offset these items except:
(i) 

 where the deferred tax asset arises from the initial recognition of an asset or a liability in a transaction that is not a business combination 
and affects neither the accounting profit nor the taxable profit or loss at the time of the transaction; and 
 where, in respect of deductible temporary differences associated with investment in subsidiaries, joint ventures and associates, a deferred 
tax asset is recognised only if it is probable that the deductible temporary difference will reverse in the foreseeable future and that 
sufficient taxable profits will be available against which the temporary difference can be utilised.

(ii) 

The carrying amounts of deferred tax assets are reviewed at each balance sheet date and are reduced to the extent that it is no longer 
probable that sufficient taxable profit would be available to allow all or part of the deferred tax asset to be utilised.

70

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

1. Summary of significant accounting policies - continued
Pension and other post employment obligations
The Group operates defined contribution and defined benefit pension schemes.

The costs arising in respect of the Group’s defined contribution schemes are charged to the Income Statement in the period in which they are 
incurred. The Group has no legal or constructive obligation to pay further contributions after payment of fixed contributions.

The Group operates a number of defined benefit pension schemes which require contributions to be made to separately administered funds. 
The liabilities and costs associated with the Group’s defined benefit pension schemes are assessed on the basis of the projected unit credit 
method by professionally qualified actuaries and are arrived at using actuarial assumptions based on market expectations at the balance 
sheet date. The Group’s net obligation in respect of defined benefit pension schemes is calculated separately for each plan by estimating the 
amount of future benefits that employees have earned in return for their service in the current and prior periods. That benefit is discounted to 
determine its present value, and the fair value of any plan asset is deducted. Plan assets are measured at bid values.

The discount rate employed in determining the present value of the schemes’ liabilities is determined by reference to market yields at the 
balance sheet date on high quality corporate bonds of a currency and term consistent with the currency and term of the associated post-
employment benefit obligations.

The net surplus or deficit arising in the Group’s defined benefit pension schemes are shown within either non-current assets or liabilities 
on the face of the Group Balance Sheet. The deferred tax impact of pension scheme surpluses and deficits is disclosed separately within 
deferred tax liabilities or assets as appropriate. In accordance with IAS 19 Employee Benefits the Group recognises actuarial gains and losses 
immediately in the Statement of Recognised Income and Expense.

When the benefits of a defined benefit plan are improved, the portion of the increased benefit relating to past service by employees is 
recognised as an expense in the Income Statement on a straight-line basis over the average period until the benefits become vested. To the 
extent that the benefits vest immediately, the expense is recognised immediately in the Income Statement.

Share-based payment transactions
Employees (including Directors) of the Group receive remuneration in the form of share-based payment transactions, whereby employees 
render service in exchange for shares or rights over shares.

The fair value of share entitlements granted is recognised as an employee expense in the Income Statement with a corresponding increase in 
equity. The fair value at the grant date is determined using a binomial model for the DCC plc 1998 Employee Share Option Scheme and the 
Black Scholes option valuation model for the DCC Sharesave Scheme. 

Non-market based vesting conditions are not taken into account when estimating the fair value of entitlements as at the grant date. The 
expense in the Income Statement represents the product of the total number of options anticipated to vest and the fair value of those options. 
This amount is allocated on a straight-line basis over the vesting period to the Income Statement with a corresponding credit to Other 
Reserves - Share Options. The cumulative charge to the Income Statement is only reversed where entitlements do not vest because non-
market performance conditions have not been met or where an employee in receipt of share entitlements relinquishes service before the end 
of the vesting period.

The proceeds received by the Company on the exercise of share entitlements are credited to Share Capital (nominal value) and Share 
Premium when the share entitlements are exercised. When the share-based payments give rise to the re-issue of shares from treasury shares, 
the proceeds of issue are credited to shareholders equity. 

The measurement requirements of IFRS 2 have been implemented in respect of share options entitlements granted after 7 November 2002. In 
accordance with the standard, the disclosure requirements of IFRS 2 have been applied to all outstanding share-based payments regardless 
of their grant date. The Group does not operate any cash-settled share-based payment schemes or share-based payment transactions with 
cash alternatives as defined in IFRS 2.

Government grants
Grants are recognised at their fair value when there is a reasonable assurance that the grant will be received and all attaching conditions have 
been complied with.

Capital grants received and receivable by the Group are credited to government grants and are amortised to the Income Statement on a 
straight-line basis over the expected useful lives of the assets to which they relate.

Revenue grants are recognised as income over the periods necessary to match the grant on a systematic basis to the costs that it is intended 
to compensate.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

71

Notes to the Financial Statements (continued)

1. Summary of significant accounting policies - continued
Shareholders’ equity
Treasury Shares
Where the Company purchases the Company’s equity share capital, the consideration paid is deducted from total shareholders’ equity and 
classified as treasury shares until they are cancelled. Where such shares are subsequently sold or reissued, any consideration received is 
included in total shareholders’ equity.

Dividends
Dividends on Ordinary Shares are recognised as a liability in the Group’s financial statements in the period in which they are approved by the 
shareholders of the Company. Proposed dividends that are approved after the balance sheet date are not recognised as a liability at that 
balance sheet date, but are disclosed in the dividends note.

2. Financial risk management
Financial risk factors
The Group uses derivative financial instruments (principally interest rate, currency and cross currency interest rate swaps and forward foreign 
exchange and commodity contracts) to hedge certain risk exposures, as detailed below, arising from operational, financing and investment 
activities. The Group does not trade in financial instruments nor does it enter into any leveraged derivative transactions. 

Financial risk management within the Group is governed by policies and guidelines reviewed and approved annually by the Board of Directors. 
These policies and guidelines primarily cover foreign exchange risk, commodity price risk, credit risk, liquidity risk and interest rate risk. 
Monitoring of compliance with the policies and guidelines is managed by the Group Risk Management function.

The Group’s financial risks are detailed in note 47.

Fair value estimation
The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. The quoted 
market price used for financial assets held by the Group is the current bid price. 

The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using 
valuation techniques. The Group uses a variety of techniques and makes assumptions that are based on market conditions existing at each 
balance sheet date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt. Other techniques, such as 
estimated discounted cash flows, are used to determine fair value for the remaining financial instruments. The fair value of interest rate swaps 
is calculated as the present value of the estimated future cash flows. The fair value of forward foreign exchange contracts is determined using 
quoted forward exchange rates at the balance sheet date.

The nominal value less impairment provision of trade receivables and payables are assumed to approximate their fair values. 

3. Critical accounting estimates and judgments
The Group’s main accounting policies affecting its results of operations and financial condition are set out on pages 63 to 71. In determining 
and applying accounting policies, judgment is often required in respect of items where the choice of specific policy, accounting estimate or 
assumption to be followed could materially affect the reported results or net asset position of the Group should it later be determined that a 
different choice would be more appropriate. Management considers the accounting estimates and assumptions discussed below to be its 
critical accounting estimates:

Goodwill
The Group has capitalised goodwill of €403.3 million at 31 March 2008. Goodwill is required to be tested for impairment at least annually or 
more frequently if changes in circumstances or the occurrence of events indicating potential impairment exist. The Group uses the present 
value of future cash flows to determine recoverable amount. In calculating the implied fair value, management judgment is required in 
forecasting cash flows of reporting units, in estimating terminal growth values and in selecting an appropriate discount rate. No impairment 
resulted from the annual impairment test in 2008. Sensitivities to changes in assumptions are detailed in note 20.

Post-retirement benefits
The Group operates a number of defined benefit retirement plans. The Group’s total obligation in respect of defined benefit plans is calculated 
by independent, qualified actuaries, updated at least annually and totals €89.8 million at 31 March 2008. At 31 March 2008 the Group 
also has plan assets totalling €67.9 million, giving a net pension liability of €21.9 million. The size of the obligation is sensitive to actuarial 
assumptions. These include demographic assumptions covering mortality and longevity, and economic assumptions covering price inflation, 
benefit and salary increases together with the discount rate used. The size of the plan assets is also sensitive to asset return levels and the 
level of contributions from the Group. Sensitivities to changes in assumptions are detailed in note 32.

72

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

3. Critical accounting estimates and judgments - continued 
Taxation
The Group is subject to income taxes in a number of jurisdictions. Provisions for tax liabilities require management to make judgments and 
estimates in relation to tax issues and exposures. Amounts provided are based on management’s interpretation of country specific tax laws 
and the likelihood of settlement. Where the final tax outcome is different from the amounts that were initially recorded, such differences will 
impact the current tax and deferred tax provisions in the period in which such determination is made.

Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the unused tax 
losses and unused tax credits can be utilised. The Group estimates the most probable amount of future taxable profits, using assumptions 
consistent with those employed in impairment calculations, and taking into account applicable tax legislation in the relevant jurisdiction. These 
calculations require the use of estimates.

Business combinations
The Group uses the purchase method of accounting for acquisitions which requires that the assets and liabilities assumed are recorded at 
their respective fair values at the date of acquisition. The application of the purchase method requires certain estimates and assumptions 
particularly concerning the determination of the fair values of the acquired assets and liabilities assumed at the date of acquisition. 

For intangible assets acquired, the Group bases valuations on expected future cash flows. This method employs a discounted cash flow 
analysis using the present value of the estimated after-tax cash flows expected to be generated from the purchased intangible asset using risk 
adjusted discount rates and revenue forecasts as appropriate. The period of expected cash flows is based on the expected useful life of the 
intangible asset acquired. 

Provision for impairment of trade receivables
The Group trades with a large and varied number of customers on credit terms. Some debts due will not be paid through the default of a 
small number of customers. The Group uses estimates based on historical experience and current information in determining the level of 
debts for which a provision for impairment is required. The level of provision required is reviewed on an ongoing basis.

Useful lives for property, plant and equipment and intangible assets
Long-lived assets comprising primarily of property, plant and equipment and intangible assets represent a significant portion of total assets. 
The annual depreciation and amortisation charge depends primarily on the estimated lives of each type of asset and, in certain circumstances, 
estimates of residual values. Management regularly review these useful lives and change them if necessary to reflect current conditions. 
In determining these useful lives management consider technological change, patterns of consumption, physical condition and expected 
economic utilisation of the assets. Changes in the useful lives can have a significant impact on the depreciation and amortisation charge for 
the period.

4. Segment information
Analysis by business segment and by geography
The Group is analysed into five main business segments: DCC Energy, DCC SerCom, DCC Healthcare, DCC Food & Beverage and DCC 
Environmental.

DCC Energy markets and sells liquefied petroleum gas and oil products for commercial/industrial, transport and domestic use in Britain and 
Ireland. DCC Energy also includes a fuel card services business.

DCC SerCom markets and sells a broad range of IT and consumer electronic products in Britain, Ireland and Continental Europe to computer 
resellers, high street retailers, computer superstores, on-line retailers and mail order companies. DCC SerCom also includes a supply chain 
management business.

DCC Healthcare markets and sells medical, surgical, laboratory, intravenous pharmaceutical, rehabilitation and independent living products 
to the acute care, community care and laboratory sectors in Britain and Ireland. DCC Healthcare is also a leading provider of contract 
manufacturing services to the health and beauty industry in Europe.

DCC Food & Beverage markets and sells food and beverages in Ireland and wine in Britain. These include healthy foods, snackfoods, fresh 
coffee and wine to a broad range of catering, convenience store, food service and multiple grocer customers. DCC Food & Beverage is also a 
leading provider of frozen food distribution in Ireland.

DCC Environmental provides a broad range of waste management services to the industrial/commercial sectors in Britain and Ireland.

Intersegment revenue is not material and thus not subject to separate disclosure. 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

73

Notes to the Financial Statements (continued)

4. Segment information - continued 
The segment results for the year ended 31 March 2008 are as follows:
Income Statement items

DCC 

Energy 
€’000 

DCC 

SerCom 
€’000 

Year ended 31 March 2008

DCC 

DCC Food 

DCC 

Healthcare 
€’000 

& Beverage  Environmental 
€’000 

€’000 

Unallocated 
€’000 

Total
€’000 

Segment revenue 

3,420,026 

1,423,357 

286,782 

310,119 

91,678 

- 

- 

- 

5,531,962

167,180

(7,928)

Operating profit* 
Amortisation of  
intangible assets 
Net operating  
exceptionals (note 11) 

74,339 

40,062 

23,440 

15,301 

14,038 

(2,389) 

(2,216) 

(1,586) 

(986) 

(751) 

(4,807) 

(1,260) 

(665) 

3,538 

(1,392) 

44,191 

39,605

67,143 

Operating profit 
Finance costs 
Finance income 
Share of associates’ profit after tax 
Profit before income tax   
Income tax expense 
Profit for the year 

36,586 

21,189 

17,853 

11,895 

44,191 

198,857
(44,912) 
27,120 
639
181,704
(16,530)
165,174

* Operating profit before amortisation of intangible assets and net operating exceptionals

DCC 

Energy 
€’000 

DCC 

SerCom 
€’000 

Year ended 31 March 2007

DCC 

DCC Food 

DCC 

Healthcare 
€’000 

& Beverage 
€’000 

Environmental 
€’000 

Unallocated 
€’000 

Total
€’000

Segment revenue 

2,247,858 

1,218,047 

234,276 

279,471 

66,466 

- 

- 

- 

4,046,118

140,084

(6,660)

Operating profit* 
Amortisation of  
intangible assets 
Net operating  
exceptionals (note 11) 

59,486 

32,603 

22,485 

15,065 

10,445 

(1,480) 

(2,136) 

(1,529) 

(1,008) 

(507) 

(1,207) 

(86) 

30,339 

- 

- 

(4,530) 

24,516

56,799 

Operating profit 
Finance costs 
Finance income 
Share of associates’ profit after tax 
Profit before income tax   
Income tax expense 
Profit for the year 

30,381 

51,295 

14,057 

9,938 

(4,530) 

157,940
(31,338)
20,488
14,710
161,800
(20,695)
141,105

* Operating profit before amortisation of intangible assets and net operating exceptionals

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
 
 
 
 
  
 
 
74

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

4. Segment information - continued 
Balance Sheet items 

DCC 

Energy 
€’000 

DCC 

SerCom 
€’000 

As at 31 March 2008

DCC 

DCC Food 

DCC 

Healthcare 
€’000 

& Beverage  Environmental 
€’000 

€’000 

Total
€’000 

Segment assets 

814,025 

502,010 

213,207 

142,596 

109,288 

1,781,126

Reconciliation to total assets as reported in the Group Balance Sheet
Investment in associates 
Derivative financial instruments (current and non-current)   
Deferred income tax assets 
Cash and cash equivalents 
Total assets as reported in the Group Balance Sheet  

4,678
26,870
10,199
485,840
2,308,713

Segment liabilities 

411,721 

260,290 

59,302 

76,581 

24,222 

832,116

Reconciliation to total liabilities as reported in the Group Balance Sheet
Interest-bearing loans and borrowings (current and non-current) 
Derivative financial instruments (current and non-current)   
Income tax liabilities (current and deferred) 
Deferred acquisition consideration (current and non-current) 
Government grants 
Total liabilities as reported in the Group Balance Sheet 

575,665
60,764
65,601
30,191
1,941
1,566,278

DCC 

Energy 
€’000 

DCC 

SerCom 
€’000 

As at 31 March 2007

DCC 

DCC Food 

DCC

Healthcare 
€’000 

& Beverage 
€’000 

Environmental 
€’000 

Total
€’000

Segment assets 

572,247 

411,615 

178,901 

143,332 

109,602 

1,415,697

Reconciliation to total assets as reported in the Group Balance Sheet
Investment in associates 
Derivative financial instruments (current and non-current)   
Deferred income tax assets 
Cash and cash equivalents 
Total assets as reported in the Group Balance Sheet 

90,332
3,142
8,305
337,079
1,854,555

Segment liabilities 

320,924 

162,180 

49,621 

74,248 

21,732 

628,705

Reconciliation to total liabilities as reported in the Group Balance Sheet 
Interest-bearing loans and borrowings (current and non-current) 
Derivative financial instruments (current and non-current)   
Income tax liabilities (current and deferred) 
Deferred acquisition consideration (current and non-current) 
Government grants 
Total liabilities as reported in the Group Balance Sheet 

394,557
46,180
65,597
29,393
2,393
1,166,825

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

75

Notes to the Financial Statements (continued)

4. Segment information - continued
Net tangible capital employed
The denominator in the Group’s return on tangible capital employed calculations is the average of the Group’s opening and closing net 
tangible capital employed. The following tables provide an analysis of the net tangible capital employed positions at 31 March 2008 and 31 
March 2007.

Segment assets 
Intangible assets 
Deferred income tax assets 
Assets employed 

Segment liabilities 
Income tax liabilities (current and deferred) 
Government grants 
Liabilities employed 

DCC 

Energy 
€’000 

814,025 
(183,952) 
3,368 
633,441 

411,721 
26,473 
- 
438,194 

DCC 

SerCom 
€’000 

502,010 
(68,207) 
1,140 
434,943 

260,290 
16,218 
228 
276,736 

As at 31 March 2008

DCC 

DCC Food 

DCC

Healthcare 
€’000 

& Beverage  Environmental 
€’000 

€’000 

Total
€’000

213,207 
(90,512) 
4,076 
126,771 

59,302 
10,579 
1,022 
70,903 

142,596 
(32,736) 
1,376 
111,236 

76,581 
4,683 
- 
81,264 

109,288 
(41,476) 
239 
68,051 

1,781,126
(416,883)
10,199
1,374,442

24,222 
7,648 
691 
32,561 

832,116
65,601
1,941
899,658

Net tangible capital employed 

195,247 

158,207 

55,868 

29,972 

35,490 

474,784

Segment assets 
Intangible assets 
Deferred income tax assets 
Assets employed 

Segment liabilities 
Income tax liabilities (current and deferred) 
Government grants 
Liabilities employed 

DCC 

Energy 
€’000 

572,247 
(104,668) 
2,411 
469,990 

320,924 
19,577 
- 
340,501 

DCC 

SerCom 
€’000 

411,615 
(59,171) 
635 
353,079 

162,180 
18,014 
275 
180,469 

As at 31 March 2007

DCC 

DCC Food 

DCC

Healthcare 
€’000 

& Beverage 
€’000 

Environmental 
€’000 

Total
€’000 

178,901 
(76,105) 
4,214 
107,010 

49,621 
16,047 
1,227 
66,895 

143,332 
(35,331) 
912 
108,913 

74,248 
4,889 
- 
79,137 

109,602 
(46,094) 
133 
63,641 

1,415,697
(321,369)
8,305
1,102,633

21,732 
7,070 
891 
29,693 

628,705
65,597
2,393
696,695

Net tangible capital employed 

129,489 

172,610 

40,115 

29,776 

33,948 

405,938

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
76

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

4. Segment information - continued
Other segment information

DCC 

Energy 
€’000 

DCC 

SerCom 
€’000 

Year ended 31 March 2008

DCC 

DCC Food 

DCC 

Healthcare 
€’000 

& Beverage  Environmental 
€’000 

€’000 

Total
€’000 

Capital expenditure 

38,246 

3,182 

15,084 

17,094 

14,010 

87,616

Depreciation 

25,558 

3,457 

4,861 

4,719 

6,850 

45,445

Intangible assets acquired 

90,124 

11,272 

18,465 

- 

1,166 

121,027

DCC  

Energy 
€’000 

DCC 

SerCom 
€’000 

Year ended 31 March 2007

DCC  

DCC Food 

 DCC

Healthcare 
€’000 

 & Beverage 
€’000 

Environmental 
€’000 

Total
€’000

Capital expenditure 

32,827 

4,807 

5,760 

6,943 

10,822 

 61,159

Depreciation 

22,519 

2,948 

5,515 

3,348 

5,131 

 39,461

Intangible assets acquired 

29,516 

1,473 

14,232 

- 

33,453 

78,674

Geographical analysis
The following is a geographical analysis of the segment information presented above. 

Republic of Ireland 

UK 

Rest of the World 

Total

2008 
€’000 

2007 
€’000 

2008 
€’000 

2007 
€’000 

2008 
€’000 

2007 
€’000 

2008 
€’000 

2007
€’000

Year ended 31 March 2008

Income Statement items

Revenue 

1,112,936 

1,040,456 

3,982,215 

2,734,464 

436,811 

271,198 

5,531,962 

4,046,118

Operating profit* 
Amortisation of 
intangible assets 
Net operating  
exceptionals 
Segment result 

Balance Sheet items

61,999 

56,408 

95,521 

79,190 

9,660 

4,486 

167,180 

140,084

(3,009) 

(2,284) 

(4,646) 

(4,103) 

(273) 

(273) 

(7,928) 

(6,660)

45,404 
104,394 

30,569 
84,693 

(5,331) 
85,544 

(5,066) 
70,021 

(468) 
8,919 

(987) 
3,226 

39,605 
198,857 

24,516
157,940

Segment assets 

537,000 

447,015 

1,126,567 

872,681 

117,559 

96,001 

1,781,126 

1,415,697

Segment liabilities 

265,645 

212,463 

515,793 

376,068 

50,678 

40,174 

832,116 

628,705

Other segment information

Capital expenditure 

33,525 

15,124 

52,915 

45,505 

1,176 

530 

87,616 

61,159

Depreciation 

14,573 

12,282 

30,152 

26,767 

720 

412 

45,445 

39,461

Intangible assets  
acquired 

 8,935 

16,358 

110,841 

58,314 

1,251 

4,002 

121,027 

78,674

* Operating profit before amortisation of intangible assets and net operating exceptionals

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

5. Other operating income/expenses 

Other operating income and expenses comprise the following charges/(credits): 

Other income 
Fair value gains on non-hedge accounted derivative financial instruments   
- forward foreign exchange contracts 
Other operating income 

Other expenses 
Expensing of employee share options (note 10) 
Fair value losses on undesignated derivative financial instruments 
- forward foreign exchange contracts 
Other operating expenses 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

77

2008 
€’000 

2007
€’000

- 
(14,564) 
(14,564) 

(244)
(7,968)
(8,212)

1,844 

1,415

495 
1,172 
3,511 

-
466
1,881

6. Group operating profit
Group operating profit has been arrived at after charging/(crediting) the following amounts (including the Group’s share of joint ventures 
accounted for on the basis of proportionate consolidation):

Provision for impairment of trade receivables 
Directors’ fees and salaries 
Amortisation of government grants (note 35) 
Operating lease rentals 
- land and buildings 
- plant and machinery 
- motor vehicles 

Audit fees 
Acquisition related due diligence and litigation support 
Tax compliance and advisory services 

2008 
€’000 

5,638 
2,145 
(288) 

8,388 
774 
4,907 
14,069 

1,476 
338 
1,902 
3,716 

2007
€’000 

4,826
2,212
(276)

6,142
594
3,082
9,818

1,256
636
1,875
3,767

7. Directors’ emoluments and interests
Directors’ emoluments and interests (which are included in operating costs) are presented in the Report on Directors’ Remuneration and 
Interests on pages 50 to 53.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
78

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

8. Proportionate consolidation of joint ventures
Impact on Group Income Statement 

Year ended 31 March 
Group share of: 

Revenue 
Cost of sales 
Gross profit 
Operating costs 
Exceptional items 
Amortisation of intangible assets 
Operating profit 
Finance income (net) 
Profit before income tax 
Income tax expense 
Group profit for the financial year 

Impact on Group Balance Sheet 

As at 31 March 
Group share of: 

Non-current assets 
Current assets 
Total assets 

Total equity 
Non-current liabilities 
Current liabilities 
Total liabilities 
Total equity and liabilities 

Impact on Group Cash Flow Statement

Year ended 31 March 
Group share of:

Net cash flow from operating activities 
Net cash flow from investing activities 
Net cash flow from financing activities 
Net increase/(decrease) in cash and cash equivalents 
Joint venture becoming a subsidiary 
Cash acquired on acquisition of joint venture 
Translation adjustment 
Cash and cash equivalents at beginning of year 
Cash and cash equivalents at end of year 

Details of the Group’s principal joint ventures are shown in the Group directory on pages 111 to 114. 

2008 
€’000 

48,026 
(31,592) 
16,434 
(8,874) 
3,628 
(157) 
11,031 
183 
11,214 
(1,960) 
9,254 

24,800 
19,094 
43,894 

26,401 
6,582 
10,911 
17,493 
43,894 

11,491 
(7,329) 
- 
4,162 
- 
204 
(569) 
5,243 
9,040 

2007
€’000

39,116
(25,179)
13,937
(7,133)
-
-
6,804
117
6,921
(1,616)
5,305

22,636
14,043
36,679

20,687
7,300
8,692
15,992
36,679

4,139
(3,243)
(1,055)
(159)
14
3,864
-
1,524
5,243

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

79

Notes to the Financial Statements (continued)

9. Employment
The average weekly number of persons (including executive Directors and the Group’s share of employees of joint ventures, applying 
proportionate consolidation) employed by the Group during the year analysed by class of business was:

DCC Energy 
DCC SerCom 
DCC Healthcare 
DCC Food & Beverage 
DCC Environmental 

The employee benefit expenses for the above were: 

Wages and salaries 
Social welfare costs 
Share based payment expense (note 10)  
Pension costs - defined contribution plans 
Pension costs - defined benefit plans (note 32) 

2008 

Number 

2007

Number

2,392 
1,513 
1,183 
1,044 
506 
6,638 

2008 
€’000 

246,114 
27,385 
1,844 
6,645 
3,246 
285,234 

1,951
1,399
1,071
854
378
5,653

2007
€’000 

212,271
22,257
1,415
5,603
2,781
244,327

10. Employee share options
The Group’s employee share options are equity-settled share-based payments as defined in IFRS 2 Share-based Payment. The IFRS requires 
that a recognised valuation methodology be employed to determine the fair value of share options granted. The expense reported in the 
Income Statement of €1.844 million (2007: €1.415 million) has been arrived at through applying the binomial model, which is a lattice option-
pricing model, for options issued under the DCC plc 1998 Employee Share Option Scheme and the Black Scholes option valuation model for 
options issued under the DCC Sharesave Scheme 2001.

Impact on Income Statement
In compliance with IFRS 2 Share-based Payment, the Group has implemented the measurement requirements of the IFRS in respect of share 
options that were granted after 7 November 2002 and had not vested by 1 April 2004.

The total share option expense is analysed as follows:

Date of grant  

Grant 

price 
€ 

Duration of 

Number of 

average 

Income Statement

  Weighted 

Expense in

vesting 

period 

options 

granted 

fair value 
€ 

DCC plc 1998 Employee Share Option Scheme
12 November 2002 
22 December 2003 
18 May 2004 
9 November 2004 
15 December 2005 
23 June 2006 
23 July 2007 
20 December 2007 

10.38 
10.70 
12.75 
15.65 
16.70 
18.05 
23.35 
19.50 

3 and 5 years 
3 and 5 years 
3 and 5 years 
3 and 5 years 
3 and 5 years 
 3 years 
 3 years 
 3 years 

609,500 
132,000 
162,500 
219,500 
215,000 
223,500 
323,000 
25,000 

2.81 
2.76 
3.42 
4.15 
4.52 
4.54 
6.35 
5.22 

DCC Sharesave Scheme 2001
10 December 2004 
Total expense 

12.63 

3 and 5 years 

716,010 

4.67 

2008 
€’000 

81 
35 
64 
179 
261 
326 
456 
11 
1,413 

431 
1,844 

2007
€’000

40
76
114
208
282
245
-
-
965

450
1,415

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
80

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

10. Employee share options - continued 
Share options

DCC plc 1998 Employee Share Option Scheme
At 31 March 2008, under the DCC plc 1998 Employee Share Option Scheme, Group employees hold basic tier options to subscribe for 
2,380,216 ordinary shares and second tier options to subscribe for 1,881,912 ordinary shares. The number of shares in respect of which 
basic tier and second tier options may be granted under this Scheme may not exceed 5% of the total number of shares in issue in each case.

Basic tier options may normally be exercised only if there has been growth in the adjusted earnings per share of the Company equivalent to 
the increase in the Consumer Price Index plus 2%, compound, per annum over a period of at least three years following the date of grant.

Second tier options may normally be exercised only if the growth in the adjusted earnings per share over a period of at least five years is such 
as would place the Company in the top quartile of companies on the ISEQ index in terms of comparison of growth in adjusted earnings per 
share and if there has been growth in the adjusted earnings per share of the Company equivalent to the increase in the Consumer Price Index 
plus 10%, compound, per annum in that period.

A summary of activity under the DCC plc 1998 Employee Share Option Scheme over the year is as follows:

At 1 April 
Granted 
Exercised 
Lapsed 
At 31 March 

2008 

2007

Average 

exercise 
price in € 
per share 

10.00 
23.07 
8.44 
11.24 
11.12 

Options 

4,172,712 
348,000 
(202,584) 
(56,000) 
4,262,128 

Average

exercise
price in €
per share 

9.47 
18.05 
8.06 
12.00 
10.00 

Options

4,589,244
223,500
(479,532)
(160,500)
4,172,712

Total exercisable at 31 March 

8.65 

2,632,628 

8.13 

2,613,212

The weighted average share price at the dates of exercise for share options exercised during the year under the DCC plc 1998 Employee 
Share Option Scheme was €19.39 (2007: €21.28).

The weighted average fair values assigned to options granted under the DCC plc 1998 Employee Share Option Scheme, which were 
computed in accordance with the binomial valuation methodology, were as follows:

Granted during the year ended 31 March 2008 
Granted during the year ended 31 March 2007 

The fair values of options granted under the DCC plc 1998 Employee Share Option Scheme were determined using the following 
assumptions:

Weighted average exercise price (in €) 
Risk-free interest rate (%) 
Dividend yield (%) 
Expected volatility (%) 
Expected life in years 

2008 

3 year 

23.07 
4.70 
2.50 
25.0 
8.0 

3 year 
€

6.26
4.54

2007

3 year

18.05
3.90
2.50
25.0
8.0

The expected volatility is based on historic volatility over the past 8 years. The expected life is the average expected period to exercise. The 
risk free rate of return is the yield on zero coupon government bonds of a term consistent with the assumed option life.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

10. Employee share options - continued
Analysis of closing balance - outstanding at end of year

Date of grant 

Date of expiry 

26 June 1998 
27 July 1998 
4 August 1998 
6 August 1998 
10 November 1998 
11 May 1999 
9 November 1999 
16 May 2000 
21 November 2000 
13 November 2001 
12 November 2002 
22 December 2003 
18 May 2004 
9 November 2004 
15 December 2005 
23 June 2006 
23 July 2007 
20 December 2007 
Total outstanding at 31 March 

26 June 2008 
27 July 2008 
4 August 2008 
6 August 2008 
10 November 2008 
11 May 2009 
9 November 2009 
16 May 2010 
21 November 2010 
13 November 2011 
12 November 2012 
22 December 2013 
18 May 2014 
9 November 2014 
15 December 2015 
23 June 2016 
23 July 2017 
20 December 2017 

Analysis of closing balance - exercisable at end of year 

Date of grant 

Date of expiry 

26 June 1998 
27 July 1998 
4 August 1998 
6 August 1998 
10 November 1998 
11 May 1999 
9 November 1999 
16 May 2000 
21 November 2000 
13 November 2001 
12 November 2002 
22 December 2003 
18 May 2004 
9 November 2004 
Total exercisable at 31 March 

26 June 2008 
27 July 2008 
4 August 2008 
6 August 2008 
10 November 2008 
11 May 2009 
9 November 2009 
16 May 2010 
21 November 2010 
13 November 2011 
12 November 2012 
22 December 2013 
18 May 2014 
9 November 2014 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

81

Average 

exercise 
price in € 
per share 

8.19 
8.13 
7.43 
7.43 
6.22 
- 
7.00 
10.65 
11.25 
10.25 
10.38 
10.70 
12.75 
15.65 
16.70 
18.05 
23.35 
19.50 

Average 

exercise 
price in € 
per share 

8.19 
 8.13 
7.43 
7.43 
6.22 
- 
7.00 
10.65 
11.25 
10.25 
10.38 
10.70 
12.75 
15.65 

2008 

2007

Average

exercise
price in €
per share 

8.19 
8.13 
7.43 
7.43 
6.22 
8.75 
7.00 
10.65 
11.25 
10.25 
10.38 
10.70 
12.75 
15.65 
16.70 
18.05 
- 
- 

Options 

391,160 
53,000 
60,000 
11,052 
492,916 
- 
707,500 
50,000 
166,500 
654,500 
451,000 
122,500 
149,500 
199,500 
189,500 
215,500 
323,000 
25,000 
4,262,128 

2008 

2007

Average

exercise
price in €
per share 

 8.19 
 8.13 
 7.43 
 7.43 
 6.22 
 8.75 
 7.00 
10.65 
11.25 
10.25 
10.38 
10.70 
- 
- 

Options 

391,160 
53,000 
60,000 
11,052 
492,916 
- 
707,500 
50,000 
166,500 
321,000 
102,500 
55,000 
79,500 
142,500 
2,632,628 

Options

395,160
69,000
60,000
17,052
544,500
12,000
747,500
50,000
212,500
699,500
476,500
127,000
149,500
199,500
197,500
215,500
-
-
4,172,712

Options

395,160
69,000
60,000
17,052
544,500
12,000
747,500
50,000
212,500
341,000
107,000
57,500
-
-
2,613,212

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
  
 
  
 
  
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
82

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

10. Employee share options - continued
DCC Sharesave Scheme 2001
Under the DCC Sharesave Scheme 2001, Group employees hold options to subscribe for 328,679 ordinary shares. Options are granted at a 
discount of 20% to the market price as provided for by the rules of the Scheme. Movements in the number of share options outstanding and 
their related weighted average exercise prices are as follows:

At 1 April 
Exercised 
Lapsed 
At 31 March 

2008 

2007

Average 

exercise 
price in € 
per share 

12.63 
12.63 
12.63 
12.63 

Average

exercise
price in €
per share 

11.47 
8.83 
11.63 
12.63 

Options

884,988
(252,701)
(68,652)
563,635

Options 

563,635 
(199,433) 
(35,523) 
328,679 

The weighted average share price at the dates of exercise for share options exercised during the year under the DCC Sharesave Scheme 
2001 was €16.01 (2007: €20.10).

Analysis of closing balance – outstanding at end of year

Date of grant 

Date of expiry 

10 December 2004 
10 December 2004 
Total outstanding at 31 March 

1 March 2009 
1 March 2011 

2008 

2007

Average 
exercise 
price in € 
per share 

12.63 
12.63 

Average

exercise
price in €
per share 

12.63 
12.63 

Options 

86,891 
241,788 
328,679 

Analysis of closing balance - exercisable at end of year
As at 31 March 2008, 86,891 (2007: none) of the outstanding options under the DCC Sharesave Scheme 2001 were exercisable.

11. Exceptionals

Profit on disposal of Manor Park Homebuilders 
Costs of legal actions with Fyffes plc 
Restructuring costs and other 
Profit on disposal of property, plant and equipment 
Net operating exceptionals 

Taxation 
Net operating exceptionals after tax 

2008 
€’000 

94,763 
(50,000) 
(5,158) 
- 
39,605 

(1,756) 
37,849 

Options

295,656
267,979
563,635

2007
€’000

-
(3,019)
(5,664)
33,199
24,516

(7,700)
16,816

The Group had a net exceptional profit before tax of €39.605 million in the year ended 31 March 2008.

A profit of €85.763 million arose from a dividend received from Manor Park Homebuilders Limited and a further profit of €9.0 million arose on 
the subsequent disposal of the Group’s 49% interest in that company.

A charge of €50.0 million was incurred in respect of the settlement of the Fyffes action and associated costs.

The Group incurred other net exceptional restructuring, legal and related costs of €5.158 million.

The tax charge relating to the net exceptional profit was €1.756 million.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

12. Finance costs and finance income

repayable within 5 years, not by instalments 
repayable within 5 years, by instalments 
repayable wholly or partly in more than 5 years 

Finance costs 
On bank loans, overdrafts and Unsecured Notes due 2008 to 2019 
- 
- 
- 
On loan notes 
- 
On finance leases 
Other interest 

repayable within 5 years, not by instalments 

Other finance costs: 
Interest on defined benefit pension scheme liabilities 
Unwinding of discount applicable to deferred acquisition consideration 
Mark-to-market of swaps and related debt 
- 
- 
- 
- 
- 

interest rate swaps designated as fair value hedges*   
cross currency interest rate swaps designated as fair value hedges* 
adjusted hedged fixed rate debt* 
currency swaps not designated as hedges 
interest rate swaps not designated as hedges 

Finance income 
Interest on cash and term deposits 
Other income receivable 
Expected return on defined benefit pension scheme assets 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

83

2008 
€’000 

2007
€’000

(18,880) 
(72) 
(19,727) 

(3) 
(532) 
(547) 
(39,761) 

(4,405) 
(648) 

15,056 
18,140 
(9,043) 
(24,301) 
50 
(44,912) 

21,886 
245 
4,989 
27,120 

(16,016)
(37)
(9,082)

(282)
(640)
(416)
(26,473)

(4,026)
(439)

1,840
(11,360)
24,365
(15,287)
42
(31,338)

14,235
1,797
4,456
20,488

Net finance cost  

(17,792) 

(10,850)

No material level of ineffectiveness has been recorded in the Income Statement for the years ended 31 March 2008 and 31 March 2007 in 
relation to cash flow hedges and fair value hedges.

* 

 The Group applies fair value hedge accounting under IAS 39 in relation to fixed rate debt and related interest rate and cross currency 
interest rate swaps.

13. Foreign currency
The exchange rates used in translating sterling Balance Sheets and Income Statement amounts were as follows:

Balance Sheet (closing rate) 
Income Statement (average rate) 

2008 
€1=Stg£ 

2007
 €1=Stg£

0.795 
0.702 

0.680
0.680

14. Share of associates’ profit after tax 
The Group’s share of associates’ profit after tax is equity-accounted and is presented as a single line item in the Group Income Statement. 
The profit after tax generated by the Group’s associates is analysed as follows: 

Group share of: 
Revenue 

Profit before finance costs 
Finance income (net) 
Profit before income tax 
Income tax expense 
Profit after tax 

2008 
€’000 

2007
€’000

14,609 

33,363

1,041 
2 
1,043 
(404) 
639 

16,403
949
17,352
(2,642)
14,710

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
84

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

15. Income tax expense

(i) Income tax expense recognised in the Income Statement 

Current taxation 
Irish corporation tax at 12.5% 
Less manufacturing relief 
Tax on net exceptionals (note 11) 
United Kingdom corporation tax at 30%   
Other overseas tax 
Total current taxation 

Deferred tax 
Irish at 12.5% 
United Kingdom at 28% (2007: 30%) 
Other overseas deferred tax 
(Over)/under provision in respect of prior years 
Total deferred tax credit 

2008 
€’000 

2007
€’000

10,859 
(251) 
1,756 
6,973 
2,708 
22,045 

(2,080) 
(444) 
(91) 
(2,900) 
(5,515) 

8,010
(310)
7,700
4,822
3,241
23,463

242
(3,207)
-
197
(2,768)

Total income tax expense 

16,530 

20,695

(ii) Deferred tax (asset)/liability recognised directly in Equity 

Defined benefit pension obligations 
Share based payments 
Cash flow hedges 

(iii) Reconciliation of effective tax rate 

Profit on ordinary activities before taxation 
Share of associates’ profit after tax 
Amortisation of intangible assets 

Total income tax expense 
Deferred tax attaching to amortisation of intangible assets  

Taxation as a percentage of profit before share of associates’ profit after tax, 
amortisation of intangible assets and net exceptionals 
Impact of net exceptionals 
Taxation as a percentage of profit before share of associates’ profit after tax 
and amortisation of intangible assets 

The following table relates the applicable Republic of Ireland statutory tax rate to the effective tax rate of the Group:

Irish corporation tax rate 
Manufacturing relief 
Effect of earnings taxed at different rates and other 

(iv) Factors that may affect future tax rates and other disclosures
The standard rate of corporation tax in Ireland is 12.5%. 

2008 
€’000 

(1,200) 
(25) 
46 
(1,179) 

2008 
€’000 

181,704 
(639) 
7,928 
188,993 

16,530 
1,659 
18,189 

2007
€’000

169
(25)
(22)
122

2007
€’000

161,800
(14,710)
6,660
153,750

20,695
1,541
22,236

11.0% 
(1.4%) 

11.2%
3.3%

9.6% 

14.5%

2008 

% 
12.5 
(0.1) 
(2.8) 
9.6 

2007

%
 12.5
(0.2)
2.2
14.5

The standard rate of corporation tax in the United Kingdom is scheduled to decrease from 30% to 28% with effect from 1 April 2008.

No provision for tax has been recognised in respect of the unremitted earnings of subsidiaries as there is no commitment to remit earnings. 
Similarly, no deferred tax assets or liabilities have been recognised in respect of temporary differences associated with investments in subsidiaries.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

85

Notes to the Financial Statements (continued)

16. Profit attributable to DCC plc
Profit after taxation for the year attributable to equity shareholders amounting to €221.280 million (2007: €40.303 million) has been accounted 
for in the financial statements of the Company. In accordance with Section 148(8) of the Companies Act 1963, the Company is availing of the 
exemption from presenting its individual Income Statement to the Annual General Meeting. The Company has also availed of the exemption from 
filing its individual Income Statement with the Registrar of Companies as permitted by Section 7(1A) of the Companies (Amendment) Act 1986.

17. Dividends

Dividends paid and proposed per Ordinary Share are as follows: 

Final - paid 31.41 cent per share on 26 July 2007 

(2007: paid 27.31 cent per share on 14 July 2006)  
Interim - paid 20.55 cent per share on 7 December 2007   

(2007: paid 17.87 cent per share on 8 December 2006)  

2008 
€’000 

2007
€’000

25,258 

22,044

16,555 

14,337

41,813 

36,381

The Directors are proposing a final dividend in respect of the year ended 31 March 2008 of 36.12 cent per ordinary share (€29.190 million). 
This proposed dividend is subject to approval by the shareholders at the Annual General Meeting.

18. Earnings per ordinary share

Profit attributable to equity holders of the Company 
Amortisation of intangible assets after tax  
Exceptionals after tax (note 11) 
Adjusted profit after taxation and minority interests 

Basic earnings per ordinary share 

Basic earnings per ordinary share 
Amortisation of intangible assets after tax  
Exceptionals after tax 
Adjusted basic earnings per ordinary share 

2008 
€’000 

164,491 
6,269 
(37,849) 
132,911 

2008 

cent 

204.28c 
7.79c 
(47.01c) 
165.06c 

2007
€’000

140,186
5,119
(16,816)
128,489

2007

cent

174.59c
6.37c
 (20.94c)
160.02c

Weighted average number of ordinary shares in issue (thousands) 

80,522 

80,294

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number 
of ordinary shares in issue during the year, excluding ordinary shares purchased by the Company and held as treasury shares. The adjusted 
figures for basic earnings per ordinary share are intended to demonstrate the results of the Group after eliminating the impact of amortisation 
of intangible assets and net exceptionals.

Diluted earnings per ordinary share 

Diluted earnings per ordinary share 
Amortisation of intangible assets after tax  
Exceptionals after tax 
Adjusted diluted earnings per ordinary share 

2008 

cent 

200.31c 
7.63c 
(46.09c) 
161.85c 

2007

cent

170.83c
6.24c
(20.49c)
156.58c

Weighted average number of ordinary shares in issue (thousands) 

82,119 

82,061

The earnings used for the purpose of the diluted earnings per share calculations were €164.491 million (2007: €140.186 million) and 
€132.911 million (2007: €128.489 million) for the purposes of the adjusted diluted earnings per share calculations.

The weighted average number of ordinary shares used in calculating the diluted earnings per share for the year ended 31 March 2008 was 
82.119 million (2007: 82.061 million). A reconciliation of the weighted average number of ordinary shares used for the purposes of calculating 
the diluted earnings per share amounts is as follows: 

Weighted average number of ordinary shares in issue 
Dilutive effect of options and partly paid shares 
Weighted average number of ordinary shares for diluted earnings per share 

2008 
‘000 

80,522 
1,597 
82,119 

2007
‘000

80,294
1,767
82,061

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
86

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

18. Earnings per ordinary share - continued
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all 
dilutive potential ordinary shares. Share options are the Company’s only category of dilutive potential ordinary shares.

Employee share options, which are performance-based, are treated as contingently issuable shares because their issue is contingent upon 
satisfaction of specified performance conditions in addition to the passage of time. These contingently issuable shares are excluded from the 
computation of diluted earnings per ordinary share where the conditions governing exercisability have not been satisfied as at the end of the 
reporting period. 

The adjusted figures for diluted earnings per ordinary share are intended to demonstrate the results of the Group after eliminating the impact 
of amortisation of intangible assets and net exceptionals.

19. Property, plant and equipment

Group 

Year ended 31 March 2008
Opening net book amount 
Exchange differences 
Acquisition of subsidiaries (note 46) 
Additions 
Disposals 
Depreciation charge 
Reclassifications 
Closing net book amount 

At 31 March 2008 
Cost 
Accumulated depreciation 
Net book amount 

Year ended 31 March 2007 
Opening net book amount 
Exchange differences 
Acquisition of subsidiaries (note 46) 
Additions 
Disposals 
Depreciation charge 
Reclassifications 
Closing net book amount 

At 31 March 2007 
Cost 
Accumulated depreciation 
Net book amount 

Plant & 

Fixtures &

fittings &

Land & 

machinery 

office 

buildings 
€’000 

& cylinders 
€’000 

equipment 
€’000 

Motor

vehicles 
€’000 

106,002 
(9,337) 
6,599 
24,640 
(2,861) 
(2,189) 
(3) 
122,851 

126,283 
(14,693) 
3,072 
32,530 
(1,887) 
(21,584) 
1,477 
125,198 

34,186 
(3,807) 
998 
11,148 
(142) 
(8,788) 
- 
33,595 

53,150 
(5,997) 
5,461 
19,298 
(2,140) 
(12,884) 
(1,474) 
55,414 

Total
€’000

319,621
(33,834)
16,130
87,616
(7,030)
(45,445)
-
337,058

139,419 
(16,568) 
122,851 

324,381 
(199,183) 
125,198 

85,162 
(51,567) 
33,595 

115,601 
(60,187) 
55,414 

664,563
(327,505)
337,058

97,044 
1,168 
10,555 
2,195 
(2,617) 
(2,277) 
(66) 
106,002 

107,320 
2,016 
10,190 
24,825 
(963) 
(17,059) 
(46) 
126,283 

30,805 
601 
382 
10,896 
(118) 
(8,606) 
226 
34,186 

32,325 
602 
10,433 
23,243 
(1,820) 
(11,519) 
(114) 
53,150 

267,494
4,387
31,560
61,159
(5,518)
(39,461)
-
319,621

121,219 
(15,217) 
106,002 

324,385 
(198,102) 
126,283 

81,077 
(46,891) 
34,186 

107,058 
(53,908) 
53,150 

633,739
(314,118)
319,621

Assets held under finance leases
The net carrying amount and the depreciation charge during the year in respect of assets held under finance leases and accordingly 
capitalised in property, plant and equipment are as follows:

Cost 
Accumulated depreciation 
Net book amount 

Depreciation charge for the year 

2008 
€’000 

57,525 
(53,999) 
3,526 

2007
€’000

67,382
(62,931)
4,451

2,252 

2,363

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

20. Intangible assets 

Group 

Year ended 31 March 2008 
Opening net book amount 
Exchange differences 
Arising on acquisition (note 46) 
Revisions to prior year acquisitions (note 46) 
Other movements  
Amortisation charge 
Closing net book amount 

At 31 March 2008 
Cost 
Accumulated amortisation 
Net book amount 

Year ended 31 March 2007 
Opening net book amount 
Exchange differences 
Arising on acquisition (note 46) 
Other movements  
Amortisation charge 
Closing net book amount 

At 31 March 2007 
Cost 
Accumulated amortisation 
Net book amount 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

87

Customer

Goodwill 
€’000 

relationships 
€’000 

Total
€’000

307,405 
(15,091) 
112,545 
(1,000) 
(590) 
- 
403,269 

13,964 
(904) 
8,482 
- 
- 
(7,928) 
13,614 

321,369
(15,995)
121,027
(1,000)
(590)
(7,928)
416,883

430,887 
(27,618) 
403,269 

34,419 
(20,805) 
13,614 

465,306
(48,423)
416,883

234,693 
1,313 
72,035 
(636) 
- 
307,405 

13,782 
203 
6,639 
- 
(6,660) 
13,964 

248,475
1,516
78,674
(636)
(6,660)
321,369

335,023 
(27,618) 
307,405 

26,841 
(12,877) 
13,964 

361,864
(40,495)
321,369

Goodwill acquired in business combinations is allocated, at acquisition, to the cash-generating units (CGUs) that are expected to benefit from 
that business combination. A summary of the allocation of the carrying value of goodwill by segment is as follows:

DCC Energy 
DCC SerCom 
DCC Healthcare 
DCC Food & Beverage 
DCC Environmental 

2008 
€’000 

177,259 
66,873 
88,112 
32,103 
38,922 
403,269 

2007
€’000

99,248
56,478
74,384
33,656
43,639
307,405

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
88

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

20. Intangible assets - continued
Impairment testing of goodwill
Goodwill acquired through business combinations is monitored for impairment by review of the underlying performance of each individual 
acquisition compared to pre-acquisition objectives and budgets. Goodwill is tested for impairment by review of profit and cash flow forecasts 
and budgets.

Goodwill acquired through business combinations has been allocated to cash-generating units (CGUs) for the purpose of impairment testing. 
The CGUs represent the lowest level within the Group at which the associated goodwill is monitored for management purposes and are not 
larger than the primary and secondary segments determined in accordance with IAS 14 Segment Reporting.

The recoverable amount of each CGU is based on a value in use computation. The cash flow forecasts employed for this computation 
are extracted from a three year plan and specifically exclude future acquisition activity. Cash flows for a further two years are based on the 
assumptions underlying the three year plan. A terminal value reflecting inflation (2008: 2.5%; 2007: 2.5%) is applied to the year five cash flows. 
A present value of the future cash flows is calculated using a before-tax discount rate representing the Group’s estimated before-tax average 
cost of capital (2008: 7.2%; 2007: 7.1%). Applying these techniques, no impairment arose in 2008 (2007: nil).

Key assumptions include management’s estimates of future profitability, capital expenditure requirements, working capital investment and tax 
considerations. Forecasts are generally based on historical performance together with management’s expectation of future trends affecting the 
industry and other developments and initiatives in the business.

A sensitivity analysis was performed using a discount rate of 10.0% and resulted in an excess in the recoverable amount of all cash generating 
units over their carrying amount.

Intangible assets
Intangible assets, other than goodwill, are recognised at their fair value at acquisition and are amortised over their useful lives. The useful lives 
of such intangible assets are finite and range from two to five years depending on the nature of the asset.

21. Investments in associates

Group 

At 1 April 
Share of profit less dividends 
Disposals 
Exchange adjustments and other 
At 31 March 

Investments in associates at 31 March 2008 includes goodwill of €1.201 million (2007: €1.201 million).

The Group’s geographical share of the assets (including goodwill) and liabilities of its associates is as follows:

Non-current 

Current 

Non-current 

assets 
€’000 

1,096 
760 
 1,856 

1,364 
773 
2,137 

assets 
€’000 

3,974 
1,904 
5,878 

90,265 
2,429 
92,694 

liabilities 
€’000 

(264) 
- 
(264) 

(1,196) 
- 
(1,196) 

As at 31 March 2008
Ireland 
USA 

As at 31 March 2007 
Ireland 
USA 

Company 

At 1 April 
Disposal 
At 31 March 

2008 
€’000 

90,332 
419 
(85,617) 
(456) 
4,678 

Current 

liabilities 
€’000 

(2,093) 
(699) 
(2,792) 

(2,027) 
(1,276) 
(3,303) 

2008 
€’000 

1,300 
(56) 
1,244 

2007
€’000

76,789
13,650
-
(107)
90,332

Net

assets
€’000

2,713
1,965
4,678

88,406
1,926
90,332

2007
€’000

1,300
-
1,300

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

22. Investments in subsidiary undertakings

Company 

At 1 April 
Other movements 
At 31 March 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

89

2008 
€’000 

161,065 
- 
161,065 

2007
€’000

161,072
(7)
161,065

Details of the Group’s principal operating subsidiaries are shown on pages 111 to 114. Non-wholly owned subsidiaries comprise Broderick 
Bros. Limited (93.8%), Virtus Limited (51.0%), Ausmedic Australia Pty Limited (60.0%), Metron Medical Australia Pty Limited (60.0%), Aukbritt 
International Pty Limited (60%), Wastecycle Limited (90.0%), Laleham Healthcare Limited (98.5%) where put and call options exist to acquire 
the remaining 1.5%, Physio-Med Services Limited (88.0%) where put and call options exist to acquire the remaining 12.0% and Distrilogie SA 
(99.5%) where put and call options exist to acquire the remaining 0.5%.

The Group’s principal overseas holding company subsidiaries are DCC Limited, a company operating, incorporated and registered in England 
and Wales and DCC International Holdings B.V., a company operating, incorporated and registered in The Netherlands. The registered office 
of DCC Limited is at Days Healthcare UK Limited, North Road, Bridgend Industrial Estate, Bridgend, CF31 3TP, Wales. The registered office of 
DCC International Holdings B.V. is Teleport Boulevard 140, 1043 EJ Amsterdam, The Netherlands.

23. Inventories

Group 

Raw materials 
Work in progress 
Finished goods 

24. Trade and other receivables

Group 

Trade receivables 
Provision for impairment of trade receivables 
Prepayments and accrued income 
Value added tax recoverable 
Other debtors 

Company 

Amounts owed by subsidiary undertakings 
Prepayments and accrued income 
Value added tax recoverable 

2008 
€’000 

9,224 
1,560 
208,968 
219,752 

2007
€’000

6,793
1,538
169,119
177,450

2008 
€’000 

2007
€’000

747,044 
(15,624) 
50,099 
14,903 
11,011 
807,433 

2008 
€’000 

494,175 
351 
104 
494,630 

564,134
(13,343)
39,223
3,677
3,566
597,257

2007
€’000

295,340
708
255
296,303

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

25. Trade and other payables

Group 

Trade payables 
Other creditors and accruals 
PAYE and National Insurance 
Value added tax 
Government grants (note 35) 
Interest payable 
Amounts due in respect of property, plant and equipment  

Company 

Amounts due to subsidiary undertakings   
Other creditors and accruals 

26. Movement in working capital

Group 

Year ended 31 March 2008 
At 1 April 2007 
Translation adjustment 
Arising on acquisition (note 46) 
Interest accruals and other 
Increase/(decrease) in working capital (note 42) 
At 31 March 2008 

Year ended 31 March 2007 
At 1 April 2006 
Translation adjustment 
Arising on acquisition (note 46) 
Interest accruals and other 
Increase in working capital (note 42) 
At 31 March 2007 

Company 

Year ended 31 March 2008 
At 1 April 2007 
Increase/(decrease) in working capital (note 42) 
Other 
At 31 March 2008 

Year ended 31 March 2007 
At 1 April 2006 
Increase/(decrease) in working capital (note 42) 
At 31 March 2007 

2008 
€’000 

584,778 
175,407 
8,376 
17,034 
129 
9,926 
1,252 
796,902 

2008 
€’000 

270,607 
1,236 
271,843 

2007
€’000

482,978
83,472
6,101
20,356
239
7,051
1,207
601,404

2007
€’000

253,602
841
254,443

Trade 

Trade

and other 

and other

Inventories 
€’000 

receivables 
€’000 

payables 
€’000 

Total
€’000

177,450 
(17,454) 
48,244 
100 
11,412 
219,752 

138,734 
1,916 
9,478 
- 
27,322 
177,450 

597,257 
(66,175) 
139,071 
(6,573) 
143,853 
807,433 

522,143 
7,515 
53,559 
(957) 
14,997 
597,257 

(601,404) 
60,746 
(140,828) 
(44,531) 
(70,885) 
(796,902) 

(543,913) 
(7,385) 
(48,497) 
(8,946) 
7,337 
(601,404) 

Trade 

Trade

and other 

and other

receivables 
€’000 

payables 
€’000 

296,303 
198,327 
- 
494,630 

(264,830) 
(17,520) 
120 
(282,230) 

173,303
(22,883)
46,487
(51,004)
84,380
230,283

116,964
2,046
14,540
(9,903)
49,656
173,303

Total
€’000

31,473
180,807
120
212,400

263,187 
33,116 
296,303 

(223,072) 
(41,758) 
(264,830) 

40,115
(8,642)
31,473

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

27. Cash and cash equivalents

Group 

Cash at bank and in hand 
Short-term bank deposits 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

91

2008 
€’000 

180,627 
305,213 
485,840 

2007
€’000

124,134
212,945
337,079

Cash at bank earns interest at floating rates based on daily bank deposit rates. The short-term deposits are for periods up to three months 
and earn interest at the respective short-term deposit rates.

Cash and cash equivalents include the following for the purposes of the Group Cash Flow Statement:

Cash and short-term bank deposits 
Bank overdrafts 

Bank overdrafts are included within current borrowings (note 29) in the Group Balance Sheet.

Company 

Cash at bank and in hand 

28. Derivative financial instruments

Group 

Non-current assets 
Interest rate swaps - fair value hedges 
Interest rate swaps - not designated as hedges 
Cross currency interest rate swaps - fair value hedges 

Current assets 
Interest rate swaps - not designated as hedges 
Forward contracts - cash flow hedges 
Commodity contracts - cash flow hedges 
Forward contracts - not designated as hedges 

Total assets 

Non-current liabilities 
Interest rate swaps - fair value hedges 
Interest rate swaps - not designated as hedges 
Currency swaps - not designated as hedges 
Cross currency interest rate swaps - fair value hedges 

Current liabilities 
Interest rate swaps - not designated as hedges 
Cross currency interest rate swaps - fair value hedges 
Forward contracts - cash flow hedges 
Forward contracts - not designated as hedges 

Total liabilities 
Net liability arising on derivative financial instruments 

2008 
€’000 

2007
€’000

485,840 
(89,794) 
396,046 

337,079
(26,892)
310,187

2008 
€’000 

2,664 

2008 
€’000 

8,655 
- 
16,692 
25,347 

985 
41 
350 
147 
 1,523 
26,870 

- 
- 
(42,116) 
(1,442) 
(43,558) 

(1,008) 
(15,672) 
(127) 
(399) 
(17,206) 
(60,764) 
(33,894) 

2007
€’000

8

2007
€’000

-
3,091
-
3,091

-
13
-
38
51
3,142

(6,401)
(3,165)
(17,815)
(18,563)
(45,944)

-
-
(149)
(87)
(236)
(46,180)
(43,038)

The full fair value of a hedging derivative is classified as a non-current asset or liability if the remaining maturity of the hedged item is more than 
twelve months and as a current asset or liability if the maturity of the hedged item is less than twelve months.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
92

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

28. Derivative financial instruments - continued
Interest rate swaps
The notional principal amounts of the outstanding interest rate swap contracts designated as fair value hedges under IAS 39 at 31 March 
2008 total US$200.0 million and Stg£55.0 million. At 31 March 2008, the fixed interest rates vary from 5.12% to 6.18% and the floating rates 
are based on US$ LIBOR and sterling LIBOR.

Currency swaps
The Group utilises currency swaps in conjunction with interest rate swaps designated as fair value hedges (as noted above) to swap fixed rate 
US$ denominated debt into floating rate euro debt. The currency swaps (which swap floating US$ denominated debt based on US$ LIBOR 
into floating euro denominated debt based on EURIBOR) have notional principal amounts of US$200.0 million / €167.113 million and are not 
designated as hedges under IAS 39.

Cross currency interest rate swaps 
The Group utilises cross currency interest rate swaps to swap fixed rate US$ denominated debt of US$300.0 million into floating rate sterling 
debt of Stg£166.652 million. At 31 March 2008 the fixed interest rates vary from 6.08% to 7.83%. These swaps are designated as fair value 
hedges under IAS 39.

Forward foreign exchange contracts
The notional principal amounts of outstanding forward foreign exchange contracts at 31 March 2008 total €21.366 million (2007: €21.266 
million). Gains and losses recognised in the cash flow hedge reserve in equity (note 38) at 31 March 2008 on forward foreign exchange 
contracts designated as cash flow hedges under IAS 39 will be released to the Income Statement at various dates up to six months after the 
balance sheet date.

Commodity price forward contracts
The notional principal amounts of outstanding forward commodity contracts at 31 March 2008 total €0.5 million (31 March 2007: nil). Gains 
and losses recognised in the cash flow hedge reserve in equity (note 38) at 31 March 2008 on forward commodity contracts designated as 
cash flow hedges under IAS 39 will be released to the Income Statement at various dates up to six months after the balance sheet date.

29. Borrowings

Group 

Non-current: 
Bank borrowings 
Finance leases* 
Unsecured Notes due 2011 to 2019 

Current: 
Bank borrowings 
Finance leases* 
Loan notes 
Unsecured Notes due 2008 

Total borrowings 

*Secured on specific plant and equipment

The maturity of non-current borrowings is as follows: 

Between 1 and 2 years 
Between 2 and 5 years 
Over 5 years 

2008 
€’000 

2007
€’000

3,040 
1,508 
353,571 
358,119 

156,165 
1,426 
127 
59,828 
217,546 
575,665 

2008 
€’000 

1,459 
7,939 
348,721 
358,119 

731
2,386
265,462
268,579

118,988
6,863
127
-
125,978
394,557

2007
€’000

72,721
7,696
188,162
268,579

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

93

Notes to the Financial Statements (continued)

29. Borrowings - continued
Bank borrowings, finance leases and loan notes
Interest on bank borrowings, finance leases and loan notes is at floating rates set in advance for periods ranging from overnight to less than 
three months by reference to inter-bank interest rates (EURIBOR, sterling LIBOR and US$ LIBOR) and consequently fair value approximates 
carrying amounts.

While the Group had various bank borrowing facilities available at 31 March 2008, it had no undrawn committed bank facilities.

Unsecured Notes due 2008 to 2019
The Group’s Unsecured Notes due 2008 to 2019 comprise fixed rate debt of US$100.0 million issued in 1996 and maturing in 2008 and 2011 
(the ‘2008/11 Notes’), fixed rate debt of US$200.0 million and Stg£30.0 million issued in 2004 and maturing in 2014 and 2016 (the ‘2014/16 
Notes’) and fixed rate debt of US$200.0 million and Stg£25.0 million issued in 2007 and maturing in 2017 and 2019 (the ‘2017/19 notes’)

The 2008/11 Notes have been swapped (using cross currency interest rate swaps designated as fair value hedges under IAS 39) from fixed 
US$ to floating sterling rates, re-pricing quarterly based on sterling LIBOR. 

The 2014/16 Notes denominated in US$ have been swapped from fixed to floating US$ rates (using interest rate swaps designated as fair 
value hedges under IAS 39) and further swapped (using currency swaps not designated as hedges under IAS 39) from floating US$ to floating 
euro rates, repricing semi-annually based on EURIBOR. The 2014/16 Notes denominated in sterling have been swapped from fixed to floating 
sterling rates (using an interest rate swap designated as a fair value hedge under IAS 39), repricing semi-annually based on sterling LIBOR. 

The 2017/19 Notes denominated in US$ have been swapped (using cross currency interest rate swaps designated as fair value hedges under 
IAS 39) from fixed US$ to floating sterling rates, repricing quarterly based on sterling LIBOR. The 2017/19 Notes denominated in sterling 
have been swapped from fixed to floating sterling rates (using an interest rate swap designated as a fair value hedge under IAS 39), repricing 
quarterly based on sterling LIBOR.

The maturity and interest profile of the Unsecured Notes due 2008 to 2019 is as follows:

Average maturity 

Average fixed interest rates* 
- US$ denominated 
- sterling denominated 

Average floating rate including swaps 
- euro denominated 
- sterling denominated  

* Issued and repayable at par

2008 

2007

7.2 years 

5.8 years

6.09% 
5.95% 

5.41% 
6.36% 

6.04%
5.76%

4.21%
5.98%

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
94

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

30. Analysis of net debt
Reconciliation of opening to closing net debt 

The reconciliation of opening to closing net debt for the year ended 31 March 2008 is as follows:

Group  

Cash and short term bank deposits  
Overdrafts 
Cash and cash equivalents 
Bank loans and loan notes 
Finance leases  
Unsecured Notes due 2008 to 2019 
Derivative financial instruments (net)  
Group net debt (including share of net cash in joint ventures) 

At 1 

April 2007 
€’000 

337,079 
(26,892) 
310,187 
(92,954) 
(9,249) 
(265,462) 
(43,038) 
(100,516) 

Fair value 

Translation 

At 31 March

Cash Flow 
€’000 

adjustment 
€’000 

adjustment 
€’000 

2008
€’000

195,269 
(70,190) 
125,079 
21,727 
5,650 
(180,286) 
187 
(27,643) 

- 
- 
- 
- 
- 
(9,043) 
8,957 
(86) 

(46,508) 
7,288 
(39,220) 
1,689 
665 
41,392 
- 
4,526 

485,840
(89,794)
396,046
(69,538)
(2,934)
(413,399)
(33,894)
(123,719)

Group net debt (excluding share of net cash in joint ventures) 

(105,759) 

(32,009) 

(86) 

5,095 

(132,759)

The reconciliation of opening to closing net debt for the year ended 31 March 2007 is as follows:

Group  

Cash and short term bank deposits  
Overdrafts 
Cash and cash equivalents 
Bank loans and loan notes 
Finance leases  
Unsecured Notes due 2008 to 2019 
Derivative financial instruments (net)  
Group net debt (including share of net cash in joint ventures) 

At 1 

April 2006 
€’000 

345,280 
(25,362) 
319,918 
(37,873) 
(10,243) 
(286,466) 
(18,017) 
(32,681) 

Fair value 

Translation 

At 31 March

Cash Flow 
€’000 

adjustment 
€’000 

adjustment 
€’000 

2007
€’000

(13,052) 
(875) 
(13,927) 
(55,063) 
1,256 
- 
- 
(67,734) 

- 
- 
- 
- 
- 
24,365 
(24,852) 
(487) 

4,851 
(655) 
4,196 
(18) 
(262) 
(3,361) 
(169) 
386 

337,079
(26,892)
310,187
(92,954)
(9,249)
(265,462)
(43,038)
(100,516)

Group net debt (excluding share of net cash in joint ventures) 

(33,150) 

(72,508) 

(487) 

386 

(105,759)

Currency profile

The currency profile of net debt at 31 March 2008 is as follows: 

Cash and cash equivalents  
Borrowings 
Derivatives 

The currency profile of net debt at 31 March 2007 is as follows: 

Cash and cash equivalents  
Borrowings 
Derivatives 

Euro 
€’000 

Sterling 
€’000 

US Dollar 
€’000 

199,113 
(239,616) 
(35,542) 
(76,045) 

278,550 
(332,652) 
1,908 
(52,194) 

7,837 
(1,059) 
(260) 
6,518 

Euro 
€’000 

Sterling 
€’000 

US Dollar 
€’000 

79,094 
(205,696) 
(23,195) 
(149,797) 

248,388 
(186,264) 
(19,666) 
42,458 

8,873 
(1,127) 
(177) 
7,569 

Other 
€’000 

340 
(2,338) 
- 
(1,998) 

Other 
€’000 

724 
(1,470) 
- 
(746) 

Total
€’000

485,840
(575,665)
(33,894)
(123,719)

Total
€’000

337,079
(394,557)
(43,038)
(100,516)

Interest rate profile
Cash and cash equivalents at 31 March 2008 and 31 March 2007 have maturity periods up to three months (note 27).

Bank borrowings and finance leases are at floating interest rates for periods less than three months while the Group’s Unsecured Notes due 
2008 to 2019 have been swapped to floating rates which reset on a quarterly or semi-annual basis (note 29).

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

95

Notes to the Financial Statements (continued)

31. Deferred income tax
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax 
liabilities and when the deferred income taxes relate to the same fiscal authority. The offset amounts are as follows:

Group 

Deferred income tax assets (deductible temporary differences): 
Deficits on Group defined benefit pension obligations 
Employee share options 
Other deductible temporary differences 

Deferred income tax liabilities (taxable temporary differences): 
Accelerated tax depreciation and fair value adjustments arising on acquisition 
Rolled-over capital gains 

The gross movement on the deferred income tax account is as follows: 

At 1 April 
Exchange differences 
Acquisition of subsidiary (note 46) 
Income Statement credit (note 15) 
Tax (credited)/charged to equity (note 15)  
At 31 March 

32. Retirement benefit obligations

2008 
€’000 

2007
€’000

3,610 
785 
5,804 
10,199 

11,453 
253 
11,706 

2008 
€’000 

6,443 
193 
1,565 
(5,515) 
(1,179) 
1,507 

3,526
574
4,205
8,305

14,475
273
14,748

2007
€’000

6,122
12
2,955
(2,768)
122
6,443

Group
The Group operates eight defined benefit pension schemes in the Republic of Ireland and three in the UK. The projected unit credit method 
has been employed in determining the present value of the defined benefit obligation arising, the related current service cost and, where 
applicable, past service cost.

Full actuarial valuations were carried out between 1 January 2004 and 1 May 2007. In general, actuarial valuations are not available for public 
inspection, although the results of valuations are advised to the members of the various pension schemes. Actuarial valuations have been 
updated to 31 March 2008 for International Accounting Standard 19 by a qualified actuary. 

The principal actuarial assumptions used were as follows:

Republic of Ireland schemes 
Rate of increase in salaries 
Rate of increase in pensions in payment   
Discount rate 
Inflation assumption 

UK schemes 
Rate of increase in salaries 
Rate of increase in pensions in payment   
Discount rate 
Inflation assumption 

The expected long term rates of return on the assets of the schemes were as follows:

Republic of Ireland schemes 
Equities 
Bonds 
Property 
Cash 

UK schemes 
Equities 
Bonds 
Property 
Cash 

2008 
 3.75% - 4.25% 
 2.50% - 3.00% 
5.60% 
2.50% 

2008 
4.50% 
 3.50% - 4.50% 
5.85% 
3.50% 

2008 
7.40% 
3.90% 
6.40% 
3.00% 

2008 
8.10% 
4.60% 
7.10% 
3.50% 

2007
  3.50% - 4.00%
  2.25% - 3.00%
  4.70% - 4.80%
2.25%

2007
4.00%
  3.00% - 4.00%
5.10%
3.00%

2007
7.50%
4.00%
6.50%
3.00%

2007
8.30%
4.80%
7.30%
3.50%

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
96

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

32. Retirement benefit obligations - continued 
The expected rate of return for equities and property has been calculated assuming that equities and property will outperform bonds by 3.5% 
and 2.5% per annum respectively over the long term. The expected rate of return for bonds has been based on bond indices as at 31 March.

Assumptions regarding future mortality experience are set based on advice from published statistics and experience in both geographic 
regions. The average life expectancy in years of a pensioner retiring at age 65 is as follows:

Current pensioners 
Male 
Female 

Future pensioners 
Male 
Female 

The Group does not operate any post-employment medical benefit schemes. 

The net pension liability recognised in the Balance Sheet is analysed as follows:

Equities 
Bonds 
Property 
Cash 
Total market value at 31 March 2008 
Present value of scheme liabilities 
Net pension liability at 31 March 2008 

Equities 
Bonds 
Property 
Cash 
Total market value at 31 March 2007 
Present value of scheme liabilities 
Net pension liability at 31 March 2007 

The amounts recognised in the Group Income Statement in respect of defined 
benefit pension schemes is as follows: 

Current service cost 
Gain on settlement/curtailment 
Total, included in employee benefit expenses (note 9) 

Interest cost, included in finance costs (note 12) 
Expected return on plan assets, included in finance income (note 12) 
Total 

The actuarial gain recognised in the Statement of Income and Expense is as follows: 

Actual return less expected return on pension scheme assets 
Experience gains and losses arising on the scheme liabilities 
Changes in assumptions underlying the present value of the scheme liabilities 
Total, included in the Statement of Recognised Income and Expense 

ROI 
€’000 

37,515 
12,393 
3,084 
1,944 
54,936 
(70,989) 
(16,053) 

ROI 
€’000 

43,420 
11,736 
2,996 
2,434 
60,586 
(69,825) 
(9,239) 

2008 

21.1 
24.1 

22.1 
25.1 

2008

UK 
€’000 

7,415 
4,323 
171 
1,062 
12,971 
(18,769) 
(5,798) 

2007

UK 
€’000 

9,781 
3,380 
790 
443 
14,394 
(21,527) 
(7,133) 

2008 
€’000 

3,246 
- 
3,246 

(4,405) 
4,989 
584 

2008 
€’000 

(13,935) 
(3,737) 
8,586 
(9,086) 

2007

20.3
23.3

21.0
24.0

Total
€’000

44,930
16,716
3,255
3,006
67,907
(89,758)
(21,851)

Total
€’000

53,201
15,116
3,786
2,877
74,980
(91,352)
(16,372)

2007
€’000

3,414
(633)
2,781

(4,026)
4,456
430

2007
€’000

904
884
(212)
1,576

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

32. Retirement benefit obligations - continued

The movement in the fair value of plan assets is as follows: 

At 1 April 
Expected return on assets 
Actuarial (loss)/gain 
Contributions by employers 
Contributions by members 
Benefits paid 
Exchange  
At 31 March 

The movement in the present value of defined benefit obligations is as follows: 

At 1 April 
Current service cost  
Interest cost 
Actuarial gain 
Contributions by members 
Benefits paid 
Settlements 
Exchange  
At 31 March 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

97

2008 
€’000 

74,980 
4,989 
(13,935) 
5,269 
393 
(1,604) 
(2,185) 
67,907 

2008 
€’000 

91,352 
3,246 
4,405 
(4,849) 
393 
(1,604) 
- 
(3,185) 
89,758 

2007
€’000

67,294
4,456
904
5,294
425
(3,704)
311
74,980

2007
€’000

87,973
3,414
4,026
(672)
425
(3,704)
(633)
523
91,352

The level of contributions for the forthcoming financial year are expected to be in line with the current year amounts.

History of scheme assets, liabilities and actuarial gains and losses

As the Group transitioned to IFRS with effect from 1 April 2004, a five-year history in respect of assets, liabilities and actuarial gains and losses 
is not available; the relevant data for the Group for the four years since transition to IFRS are as follows:

Fair value of assets 
Present value of liabilities  
Net pension liability 

Difference between the expected and actual return on scheme assets 
As a percentage of scheme assets 

Experience gains and losses on scheme liabilities 
As a percentage of the present value of the scheme liabilities 

Total recognised in Statement of Recognised Income and Expense 
As a percentage of the present value of the scheme liabilities 

2008 
€’000 

67,907 
(89,758) 
(21,851) 

(13,935) 
(20.5%) 

(3,737) 
 4.2% 

(9,086) 
 10.1% 

2007 
€’000 

74,980 
(91,352) 
(16,372) 

904 
 1.2% 

884 
 (1.0%) 

1,576 
 (1.7%) 

2006 
€’000 

67,294 
(87,973) 
(20,679) 

8,697 
 12.9% 

(383) 
0.4% 

1,779 
 (2.0%) 

2005
€’000 

54,659
(80,039)
(25,380)

1,277
 2.3%

(1,598)
 2.0%

(7,742)
 9.7%

Cumulatively since 1 April 2004, €13.473 million has been recognised as a charge in the Statement of Recognised Income and Expense.

Sensitivity analysis for principal assumptions used to measure scheme liabilities
There are inherent uncertainties surrounding the financial assumptions adopted in calculating the actuarial valuation of the Group’s defined 
benefit pension schemes. The following table analyses, for the Group’s Irish and UK pension schemes, the estimated impact on plan liabilities 
resulting from changes to key actuarial assumptions, whilst holding all other assumptions constant. 

Assumption 
Discount rate 
Price inflation 
Mortality 

Change in assumption 
Increase/decrease 0.25% 
Increase/decrease 0.25% 
Increase/decrease by one year 

Impact on Irish plan liabilities 
Increase/decrease by 5.6% 
Increase/decrease by 1.4% 
Increase/decrease by 2.4% 

Impact on UK plan liabilities 
Increase/decrease by 6.2%
Increase/decrease by 5.3%
Increase/decrease by 2.6%

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
98

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

33. Deferred acquisition consideration

Group
The Group’s deferred acquisition consideration of €30.191 million (2007: €29.393 million) as stated on the Balance Sheet consists of €3.237 
million of € floating rate financial liabilities (2007: €13.530 million) and €26.954 million of Stg£ floating rate financial liabilities (2007: €15.863 
million) payable as follows:

Within one year 
Between one and two years 
Between two and five years 

Analysed as: 
Non-current liabilities 
Current liabilities 

2008 
€’000 

14,036 
8,691 
7,464 
30,191 

16,155 
14,036 
30,191 

34. Provisions for liabilities and charges 

The reconciliation of the movement in provisions for liabilities and charges for the year ended 31 March 2008 is as follows:

Group 

At 1 April 2007 
Provided during the year 
Utilised during the year 
Arising on acquisition (note 46) 
Exchange 
At 31 March 2008 

Analysed as: 
Non-current liabilities 
Current liabilities 

  Environmental 

Insurance and

 and remediation 
€’000 

6,122 
285 
(93) 
- 
(915) 
5,399 

other 
€’000 

4,807 
4,684 
(2,015) 
553 
(65) 
7,964 

The reconciliation of the movement in provisions for liabilities and charges for the year ended 31 March 2007 is as follows:

Group 

At 1 April 2006 
Provided during the year 
Utilised during the year 
Arising on acquisition (note 46) 
Exchange 
At 31 March 2007 

Analysed as: 
Non-current liabilities 
Current liabilities 

Environmental 

Insurance and

  and remediation 
€’000 

- 
- 
(57) 
6,122 
57 
6,122 

other 
€’000 

3,785 
2,083 
(1,061) 
- 
- 
4,807 

2007
€’000

10,870
9,701
8,822
29,393

18,523
10,870
29,393

Total
€’000

10,929
4,969
(2,108)
553
(980)
13,363

2008
€’000

5,399
7,964
13,363

Total
€’000

3,785
2,083
(1,118)
6,122
57
10,929

2007
€’000

6,122
4,807
10,929

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

99

Notes to the Financial Statements (continued)

34. Provisions for liabilities and charges - continued 
Environmental and remediation
This provision relates to obligations governing site remediation and improvement costs to be incurred in compliance with environmental 
regulations. The net present value of the estimated costs is capitalised as property, plant and equipment. The unwinding of the discount 
element on the provision is reflected as a finance cost in the Income Statement. Provision is made for the net present value of post closure 
costs based on the quantity of waste input into the landfill during the year. Ongoing costs incurred during the operating life of the sites are 
written off directly to the Income Statement and are not charged to the provision. The majority of the obligations will unwind over a 30-year 
timeframe. 

Insurance and other
The insurance provision relates to employers liability and public and products liability and reflects an estimation of the excess not recoverable 
from insurers arising from claims against Group companies. A significant element of the provision is subject to external assessments. 

35. Government grants

Group 

At 1 April 
Amortisation in year 
Received in year 
Arising on acquisition (note 46) 
Exchange and other adjustments 
At 31 March 
Disclosed as due within one year (note 25) 

36. Equity share capital

Group and Company 

Authorised 
152,368,568 ordinary shares of €0.25 each 

Issued 
88,229,404 ordinary shares (including 7,414,239 ordinary shares held as Treasury Shares) 
of €0.25 each, fully paid (2007: 88,229,404 ordinary shares (including 7,816,256 ordinary 
shares held as Treasury Shares) of €0.25 each, fully paid)  

Ordinary shares of €0.25 each 

At 31 March 2008 and 31 March 2007 

2008 
€’000 

2,632 
(288) 
92 
- 
(366) 
2,070 
(129) 
1,941 

2007
€’000

2,122
(276)
-
758
28
2,632
(239)
2,393

2008 
€’000 

2007
€’000

38,092 

38,092

22,057 

22,057

No. of shares 
‘000 

€’000

88,229 

22,057

As at 31 March 2008, the total authorised number of ordinary shares is 152,368,568 shares (2007: 152,368,568 shares) with a par value of 
€0.25 per share (2007: €0.25 per share).

During the year the Company reissued 402,017 Treasury Shares for a consideration (net of expenses) of €4.060 million.

All shares, whether fully or partly paid, carry equal voting rights and rank for dividends to the extent to which the total amount payable on each 
share is paid up.

Details of share options granted under the Company’s share option schemes and the terms attaching thereto are provided in note 10 to the 
financial statements and in the Report on Directors’ Remuneration and Interests on pages 50 to 53.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

37. Share premium account

Group and Company 

At 31 March 2008 and 31 March 2007 

38. Other reserves

Group 

At 1 April 2006 
Currency translation 
Cash flow hedges 
- fair value gains in year 
- tax on fair value gains 
- transfers to cost of sales 
- tax on transfers to income tax expense  
Share based payment 
At 31 March 2007 
Currency translation 
Cash flow hedges 
- fair value losses in year 
- tax on fair value losses 
- transfers to sales 
- transfers to cost of sales 
- tax on transfers to income tax expense  
Share based payment 
At 31 March 2008 

Company 

At 31 March 2008 and 31 March 2007 

2008 
€’000 

2007
€’000

124,687 

124,687

Cash 

Foreign

currency

Share 

flow hedge 

translation 

options1 
€’000 

reserve2 
€’000 

reserve3 
€’000 

Other

reserves4 
€’000 

3,392 
- 

- 
- 
- 
- 
1,415 
4,807 
- 

- 
- 
- 
- 
- 
1,844 
6,651 

20 
- 

(4,125) 
495 
3,966 
(473) 
- 
(117) 
- 

1,665 
(374) 
(306) 
(943) 
297 
- 
222 

(10,344) 
7,430 

- 
- 
- 
- 
- 
(2,914) 
(64,310) 

- 
- 
- 
- 
- 
- 
(67,224) 

1,400 
- 

- 
- 
- 
- 
- 
1,400 
- 

- 
- 
- 
- 
- 
- 
1,400 

Total
€’000 

(5,532)
7,430

(4,125)
495
3,966
(473)
1,415
3,176
(64,310)

1,665
(374)
(306)
(943)
297
1,844
(58,951)

Other 
 reserves5
€’000 

344

1   The share option reserve comprises the amounts expensed in the Income Statement in connection with share based  payments.
 The cash flow hedge reserve comprises the effective portion of the cumulative net change in the fair value of cash flow  hedging 
2  
instruments related to hedged transactions that have not yet occurred.
 The foreign currency translation reserve represents all foreign exchange differences from 1 April 2005 arising from the  translation of the 
net assets of the Group’s non-euro denominated operations, including the translation of the profits and  losses of such operations from the 
average rate for the year to the closing rate at the balance sheet date.

3  

4   The Group’s other reserves comprise a capital conversion reserve fund and an unrealised gain on the disposal of an associate. 
5  The Company’s other reserve is a capital conversion reserve fund.

39. Retained earnings

Group 

At 1 April 
Net income recognised in Income Statement 
Net income recognised directly in equity   
- actuarial (loss)/gain on Group defined benefit pension schemes 
- deferred tax on actuarial loss/(gain) 
Deferred tax on employee share options   
Share buyback (inclusive of costs) 
Re-issue of Treasury Shares (net of expenses) 
Dividends 
At 31 March 

2008 
€’000 

2007
€’000

531,994 
164,491 

(9,086) 
1,200 
25 
- 
4,060 
(41,813) 
650,871 

439,477
140,186

1,576
(169)
25
(18,818)
6,098
(36,381)
531,994

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the Financial Statements (continued)

39. Retained earnings - continued

Company 

At 1 April 
Total recognised income and expense for the financial year 
Share buyback (inclusive of costs) 
Re-issue of Treasury Shares (net of expenses) 
Dividends 
At 31 March 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

101

2008 
€’000 

46,758 
221,280 
- 
4,060 
(41,813) 
230,285 

2007
€’000

55,556
40,303
(18,818)
6,098
(36,381)
46,758

The cost to the Group and the Company of €92.625 million to acquire the 7,414,239 shares held in Treasury has been deducted from the 
Group and Company Retained Earnings. These shares were acquired at prices ranging from €9.25 to €17.90 each (average: €11.23) 
between 28 July 2000 and 19 June 2006.

40. Minority interest

Group 

At 1 April 
Arising on acquisition of subsidiary (note 46) 
Share of profit for the financial year (less attributable to associates) 
Dividends to minorities 
Exchange and other adjustments 
At 31 March 

41. Movement in total equity

Group 

At 1 April 
Issue of share capital 
Share based payment (note 10) 
Share buyback (note 39) 
Dividends (note 17) 
Movement in minority interest 
Total recognised income and expense for the financial year 
At 31 March 

Company 

At 1 April 
Issue of share capital 
Share buyback (note 39) 
Dividends (note 17) 
Total recognised income and expense for the financial year 
At 31 March 

2008 
€’000 

5,816 
- 
683 
(2,725) 
(3) 
3,771 

2007
€’000

4,714
663
476
(38)
1
5,816

2008 
€’000 

2007
€’000

687,730 
4,060 
1,844 
- 
(41,813) 
(2,045) 
92,659 
742,435 

2008 
€’000 

193,846 
4,060 
- 
(41,813) 
221,280 
377,373 

585,403
6,098
1,415
(18,818)
(36,381)
1,102
148,911
687,730

2007
€’000 

202,644
6,098
(18,818)
(36,381)
40,303
193,846

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
102

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

42. Cash generated from operations

Group 

Profit for the financial year 
Add back non-operating (income)/expense 
- Tax (note 15) 
- Share of profit from associates (note 14) 
- Net operating exceptionals (note 11) 
- Net finance costs (note 12) 
Operating profit 
- Share-based payments expense (note 10) 
- Depreciation (note 19) 
- Amortisation (note 20) 
- Profit on sale of property, plant and equipment 
- Amortisation of government grants (note 35) 
- Dividends received from associates 
- Other 
Changes in working capital (excluding the effects of acquisition and exchange  
differences on consolidation): 
- Inventories (note 26) 
- Trade and other receivables (note 26) 
- Trade and other payables (note 26) 
Cash generated from operations 

Company 

Profit for the financial year 
Add back non-operating (income)/expense 
- Tax 
- Net operating exceptionals 
- Net finance costs  
Operating profit 
Changes in working capital: 
- Trade and other receivables (note 26) 
- Trade and other payables (note 26) 
Cash generated from operations 

2008 
€’000 

2007
€’000

165,174 

141,105

16,530 
(639) 
(39,605) 
17,792 
159,252 
1,844 
45,445 
7,928 
(751) 
(288) 
220 
(227) 

(11,412) 
(143,853) 
70,885 
129,043 

20,695
(14,710)
(24,516)
10,850
133,424
1,415
39,461
6,660
(1,362)
(276)
268
(2,513)

(27,322)
(14,997)
(7,337)
127,421

2008 
€’000 

2007
€’000

221,280 

40,303

1,750 
7,056 
(3,123) 
226,963 

(198,327) 
17,520 
46,156 

(1,319)
-
(3,407)
35,577

(33,116)
41,758
44,219

43. Contingencies
Guarantees
The Company and certain subsidiaries have given guarantees of €707.548 million (2007: €535.692 million) in respect of borrowings and 
other obligations arising in the ordinary course of business of the Company and other Group undertakings. It is not anticipated that any 
material liabilities will arise from these contingent liabilities.

Other
Pursuant to the provisions of Section 17, Companies (Amendment) Act, 1986, the Company has guaranteed the liabilities of the following 
subsidiaries; Alvabay Limited, Classic Fuel & Oil Limited, DCC Business Expansion Fund Limited, DCC Corporate Partners Limited, DCC 
Energy Limited, DCC Financial Services Holdings Limited, DCC Funding 2007 Limited, DCC Healthcare Limited, DCC Management Services 
Limited, DCC Nominees Limited, DCC SerCom Limited, Emo Oil Limited, Fannin Limited, Fannin Compounding Limited, Flogas Ireland 
Limited, SerCom Property Limited, Shannon Environmental Holdings Limited and Sharptext Limited. As a result, these companies will be 
exempted from the filing provisions of Section 7, Companies (Amendment) Act, 1986.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

103

Notes to the Financial Statements (continued)

44. Capital expenditure commitments

Group 

Capital expenditure that has been contracted for but has not been provided for in the financial statements   
Capital expenditure that has been authorised by the Directors but has not yet been contracted for 

45. Commitments under operating and finance leases

Group

Operating leases
Future minimum rentals payable under non-cancellable operating leases at 31 March are as follows:

Within one year 
After one year but not more than five years 
More than five years 

2008 
€’000 

5,113 
58,269 
63,382 

2007
€’000

2,721
70,389
73,110

2008 
€’000 

5,759 
14,319 
29,499 
49,577 

2007
€’000

6,430
17,559
44,871
68,860

The Group leases a number of properties under operating leases. The leases typically run for a period of 15 to 25 years. Rents are generally 
reviewed every five years.

During the year ended 31 March 2008, €14.069 million (2007: €9.818 million) was recognised as an expense in the Income Statement in 
respect of operating leases.

Finance leases
Future minimum lease payments under finance leases together with the present value of the net minimum lease payments are as follows:

Within one year 
After one year but not more than five years 

Less: amounts allocated to future finance costs 
Present value of minimum lease payments 

2008 

2007

Minimum 

payments 
€’000 

1,469 
1,755 
3,224 
(290) 
2,934 

Present 

value of 

payments 
€’000 

1,426 
1,508 
2,934 
- 
2,934 

Minimum 

payments 
€’000 

7,214 
2,699 
9,913 
(664) 
9,249 

Present

value of

payments
€’000

6,863
2,386
9,249
-
9,249

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
104

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

46. Business combinations
The principal acquisitions completed by the Group during the year, together with percentages acquired were as follows:
-  CPL Petroleum Limited (100%): a British based oil distribution business, acquired on 31 August 2007;
- 

 Banque Magnetique SAS (100%): a French based distributor of consumer electronic products and IT peripherals, acquired on 12 
November 2007;
 Squadron Medical Limited (100%): an English based procurer and supplier of medical and surgical products to hospitals, acquired on 23 
November 2007; and

- 

-  Southern Counties Fuels Holdings Limited (100%): an English based oil distribution business acquired on 7 March 2008. 

Identifiable net assets acquired (excluding net cash acquired) were as follows:

Assets 
Non-current assets 
Property, plant and equipment (note 19)   
Intangible assets - goodwill (note 20) 
Intangible assets - other intangible assets (note 20) 
Deferred income tax assets (note 31) 
Total non-current assets 

Current assets 
Inventories (note 26) 
Trade and other receivables (note 26) 
Total current assets 

Equity 
Minority interest (note 40) 
Total equity 

Liabilities 
Non-current liabilities 
Deferred income tax liabilities (note 31) 
Provisions for liabilities and charges (note 34) 
Government grants (note 35) 
Total non-current liabilities 

Current liabilities 
Trade and other payables (note 26) 
Current income tax liabilities 
Total current liabilities 

2008 
€’000 
CPL 

5,839 
70,121 
2,009 
- 
77,969 

3,307 
44,055 
47,362 

2008 
€’000 
Others 

10,291 
42,424 
6,473 
479 
59,667 

2008 
€’000 
Total 

16,130 
112,545 
8,482 
479 
137,636 

44,937 
95,016 
139,953 

48,244 
139,071 
187,315 

2007
€’000
Total

31,560
72,035
6,639
-
110,234

9,478
53,559
63,037

- 
- 

- 
- 

- 
- 

(663)
(663)

(631) 
(553) 
- 
(1,184) 

(1,413) 
- 
- 
(1,413) 

(2,044) 
(553) 
- 
(2,597) 

(2,955)
(6,122)
(758)
(9,835)

(43,657) 
(29) 
(43,686) 

(97,171) 
(1,942) 
(99,113) 

(140,828) 
(1,971) 
(142,799) 

(48,497)
(1,959)
(50,456)

Total consideration (enterprise value)  

80,461 

99,094 

179,555 

112,317

Satisfied by: 
Cash 
Net (cash)/debt acquired 
Net cash outflow 
Deferred acquisition consideration 
Total consideration 

80,772 
(450) 
80,322 
139 
80,461 

76,087 
10,175 
86,262 
12,832 
99,094 

156,859 
9,725 
166,584 
12,971 
179,555 

103,285
(1,796)
101,489
10,828
112,317

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

105

Notes to the Financial Statements (continued)

46. Business combinations - continued
The acquisition of CPL has been deemed to be a substantial transaction and separate disclosure of the fair values of the identifiable assets 
and liabilities has therefore been made. None of the remaining business combinations completed during the year were considered sufficiently 
material to warrant separate disclosure of the fair values attributable to those combinations. The carrying amounts of the assets and liabilities 
acquired, determined in accordance with IFRS before completion of the combination together with the adjustments made to those carrying 
values disclosed above were as follows:

CPL 

Non-current assets (excluding goodwill)   
Current assets 
Non-current liabilities and minority interest 
Current liabilities 
Identifiable net assets acquired 
Goodwill arising on acquisition 
Total consideration (enterprise value) 

Other acquisitions 

Non-current assets (excluding goodwill)   
Current assets 
Non-current liabilities and minority interest 
Current liabilities 
Identifiable net assets acquired 
Goodwill arising on acquisition 
Total consideration (enterprise value) 

Total 

Non-current assets (excluding goodwill)   
Current assets 
Non-current liabilities and minority interest 
Current liabilities 
Identifiable net assets acquired 
Goodwill arising on acquisition 
Total consideration (enterprise value) 

Book 

value 
€’000 

Fair value 

adjustments 
€’000 

5,839 
47,739 
(581) 
(43,309) 
9,688 
70,773 
80,461 

2,009 
(377) 
(603) 
(377) 
652 
(652) 
- 

Book 

value 
€’000 

Fair value 

adjustments 
€’000 

10,770 
139,953 
(473) 
(99,113) 
51,137 
47,957 
99,094 

6,473 
- 
(940) 
- 
5,533 
(5,533) 
- 

Book 

value 
€’000 

Fair value 

adjustments 
€’000 

16,609 
187,692 
(1,054) 
(142,422) 
60,825 
118,730 
179,555 

8,482 
(377) 
(1,543) 
(377) 
6,185 
(6,185) 
- 

Fair

value
€’000

7,848
47,362
(1,184)
(43,686)
10,340
70,121
80,461

Fair

value
€’000

17,243
139,953
(1,413)
(99,113)
56,670
42,424
99,094

Fair

value
€’000

25,091
187,315
(2,597)
(142,799)
67,010
112,545
179,555

The initial assignment of fair values to identifiable net assets acquired has been performed on a provisional basis. Any amendments to these fair 
values within the twelve month timeframe from the date of acquisition will be disclosable in the 2009 Annual Report as stipulated by IFRS 3.

The principal factors contributing to the recognition of goodwill on business combinations entered into by the Group are the expected 
profitability of the acquired business and the realisation of cost savings and synergies with existing Group entities.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
106

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

46. Business combinations - continued
The total adjustments processed during the year to the fair value of business combinations completed during the year ended 31 March 2007 
where those fair values were not readily determinable as at 31 March 2007 were as follows:

Non-current assets (excluding goodwill)   
Current assets 
Non-current liabilities and minority interest 
Current liabilities 
Identifiable net assets acquired 
Goodwill arising on acquisition 
Total consideration (enterprise value) 

  Adjustments to

Initial fair value   provisional fair 

assigned 
€’000 

38,199 
63,037 
(10,498) 
(50,456) 
40,282 
72,035 
112,317 

values 
€’000 

100 
550 
- 
350 
1,000 
(1,000) 
- 

Revised 

fair value
€’000 

38,299
63,587
(10,498)
(50,106)
41,282
71,035
112,317

The post-acquisition impact of business combinations completed during the year on Group profit for the financial year was as follows:

Revenue 
Cost of sales 
Gross profit 
Operating costs 

Exceptional items 
Operating profit 
Finance costs (net) 
Profit before tax 
Income tax expense 
Group profit for the financial year 

2008 
€’000 

2007
€’000

618,957 
(576,804) 
42,153 
(28,826) 
13,327 
(1,705) 
11,622 
81 
11,703 
(3,245) 
8,458 

411,207
(381,237)
29,970
(19,384)
10,586
-
10,586
114
10,700
(2,903)
7,797

The revenue and profit of business combinations completed during the year, determined in accordance with IFRS as though the acquisition 
date for all business combinations effected during the year had been the beginning of that year would be as follows:

Revenue 

Group profit for the financial year 

2008 
€’000 

2007
€’000

1,324,838 

773,084

13,952 

11,966

47. Financial risk and capital management
Capital risk management
The Group’s objectives when managing capital (defined as net debt plus equity) are to safeguard the Group’s ability to continue as a going 
concern in order to provide returns to shareholders and benefits for other stakeholders, while maintaining a strong balance sheet to support 
the continued organic and acquisitive growth of its businesses and to maintain investor, creditor and market confidence. 

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or 
buy back existing shares, increase or reduce debt or sell assets.

The policy for net debt is to ensure a structure of longer term debt funding and cash balances with deposit maturities up to six months.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

107

Notes to the Financial Statements (continued)

47. Financial risk and capital management - continued
Financial risk management
Group financial risk management is governed by policies and guidelines which are reviewed and approved annually by the Board of Directors, 
most recently in February 2008. These policies and guidelines primarily cover foreign exchange risk, commodity price risk, credit risk, liquidity 
risk and interest rate risk. The principal objective of these policies and guidelines is the minimisation of financial risk at reasonable cost. The 
Group does not trade in financial instruments nor does it enter into any leveraged derivative transactions. DCC’s Group Treasury function 
centrally manages the Group’s funding and liquidity requirements. Divisional and subsidiary management, in conjunction with Group Treasury, 
manage foreign exchange and commodity price exposures within approved policies and guidelines.

There are no significant concentrations of risk and there has been no significant change during the financial year, or since the end of the year, 
to the types of financial risks faced by the Group or the Group’s approach to the management of those risks.

(i)  Credit risk management
Credit risk arises from credit exposure to trade debtors, cash and cash equivalents including deposits with banks and financial institutions, 
derivative and financial instruments.

Trade receivables arise from a wide and varied customer base spread throughout the Group’s operations and as such there is no significant 
concentration of credit risk. The Group’s credit risk management policy in relation to trade receivables involves periodically assessing the 
financial reliability of customers, taking into account their financial position, past experience and other factors. The utilisation of credit limits is 
regularly monitored and a significant element of credit risk is covered by credit insurance. 

Risk of counterparty default arising on cash and cash equivalents and derivative financial instruments is controlled within a framework of 
dealing with high quality institutions and, by policy, limiting the amount of credit exposure to any one bank or institution. DCC transacts with a 
variety of high credit quality financial institutions for the purpose of placing deposits and entering into derivative contracts. The Group actively 
monitors its credit exposure to each counterparty to ensure compliance with the counterparty risk limits of the Board approved treasury policy. 
Of the total cash and cash equivalents at 31 March 2008 of €485.840 million, a minimum of 96.9% (€470.972 million) was with financial 
institutions in the A-1 (short-term) category of Standard and Poors and in the P-1 (short-term) category of Moodys. As at 31 March 2008 
derivative transactions were with counterparties with ratings ranging from A+ to AA (long-term) with Standard and Poors or A1 to Aa1 (long-
term) with Moodys. In the normal course of business, the Group operates notional cash pooling systems, where a legal right of set-off applies.

Management does not expect any significant counterparty to fail to meet its obligations. The maximum exposure to credit risk is represented 
by the carrying amount of each asset. 

Included in the Group’s trade and other receivables as at 31 March 2008 are balances of €131.477 million (2007: €84.239 million) which are 
past due at the reporting date but not impaired in the majority of cases. The aged analysis of these balances is as follows:

Group 

Less than 1 month overdue 
1 - 3 months overdue 
3 - 6 months overdue 
Over 6 months overdue 

The movements in the provision for impairment of trade receivables during the year is as follows:

Group 

At 1 April 
Provision for impairment recognised in the year 
Amounts recovered during the year 
Amounts written off during the year 
Arising on acquisition 
Exchange differences 
At 31 March 

Company
There were no past due or impaired trade receivables in the Company at 31 March 2008 (31 March 2007: none).

2008 
€’000 

76,336 
26,532 
20,494 
8,115 
131,477 

2008 
€’000 

13,343 
5,638 
(805) 
(4,762) 
3,723 
(1,513) 
15,624 

2007
€’000

45,532
21,631
10,697
6,379
84,239

2007
€’000

11,673
4,826
20
(4,480)
1,198
106
13,343

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
108

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

47. Financial risk and capital management - continued
(ii)  Liquidity risk management
The Group maintains a strong balance sheet with long-term debt funding and cash balances with deposit maturities up to six months. 
Wherever possible, surplus funds in the Group are transferred to the centralised treasury department through the repayment of borrowings, 
deposits and dividends. These are then on-lent or contributed as equity to fund Group operations, used to retire external debt or invested 
externally. The Group does not use off-balance sheet special purpose entities as a source of liquidity or for other financing purposes. In 
addition, the Group maintains significant uncommitted credit lines with its relationship banks. 

The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period to contractual maturity 
at the balance sheet date. The amounts disclosed in the table are the contractual undiscounted cash flows.

As at 31 March 2008 

Group 

Trade and other payables  
Borrowings (principal repayments) 
Future finance charges 

Less: future finance charges 

As at 31 March 2007 

Group 

Trade and other payables  
Borrowings (principal repayments) 
Future finance charges 

Less: future finance charges 

Less than 

Between 

Between 

1 year 
€’000 

1 and 2 years 
€’000 

2 and 5 years 
€’000 

796,902 
233,161 
33,999 
1,064,062 
(33,999) 
1,030,063 

- 
1,459 
22,506 
23,965 
(22,506) 
1,459 

- 
9,376 
66,423 
75,799 
(66,423) 
9,376 

Less than 

Between 

Between 

1 year 
€’000 

1 and 2 years 
€’000 

2 and 5 years 
€’000 

601,404 
125,978 
24,897 
752,279 
(24,897) 
727,382 

- 
89,511 
15,511 
105,022 
(15,511) 
89,511 

- 
9,258 
37,451 
46,709 
(37,451) 
9,258 

Over

5 years 
€’000 

- 
364,086 
73,022 
437,108 
(73,022) 
364,086 

Over

5 years 
€’000 

- 
211,269 
28,785 
240,054 
(28,785) 
211,269 

Total
€’000 

796,902
608,082
195,950
1,600,934
(195,950)
1,404,984

Total
€’000 

601,404
436,016
106,644
1,144,064
(106,644)
1,037,420

The Group has sufficient cash resources and liquid assets to enable it to meet its current borrowing obligations and trade and other payables.

As at 31 March 2008 

Company 

Less than 

Between 

Between 

1 year 
€’000 

1 and 2 years 
€’000 

2 and 5 years 
€’000 

Over

5 years 
€’000 

Total
€’000 

Trade and other payables 

271,843 

- 

10,387 

- 

282,230

As at 31 March 2007 

Company 

Less than 

Between 

Between 

1 year 
€’000 

1 and 2 years 
€’000 

2 and 5 years 
€’000 

Over

5 years 
€’000 

Total
€’000 

Trade and other payables 

254,443 

- 

10,387 

- 

264,830

The Company has sufficient cash resources and liquid assets to enable it to meet its trade and other payables.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

109

Notes to the Financial Statements (continued)

47. Financial risk and capital management - continued
(iii)  Market risk management
Foreign exchange risk management
DCC’s reporting currency and that in which its share capital is denominated is the euro. Foreign exchange risk arises from future commercial 
transactions, recognised assets and liabilities and net investments in foreign operations giving rise to exposure to other currencies, primarily 
sterling and the US dollar.

Divisional and subsidiary management, in conjunction with Group Treasury, manage foreign currency exposures within approved policies and 
guidelines using forward currency contracts.

The portion of the Group’s operating profits which are sterling denominated are offset to a limited degree by certain natural economic hedges 
that exist within the Group in that a proportion of the purchases by certain of its Irish businesses are sterling denominated. The Group does 
not hedge the remaining translation exposure on the translation of the profits of foreign currency subsidiaries on the basis that they are not 
intended to be repatriated. The 3.3% reduction in the average translation rate of sterling adversely impacted the Group’s reported operating 
profit by €3.4 million in the year ended 31 March 2008.

The Group has investments in sterling operations which are highly cash generative. The Group seeks to manage the resultant foreign currency 
translation risk through borrowings denominated in or swapped (utilising currency swaps or cross currency interest rate swaps) into sterling, 
although this hedge is offset by the strong ongoing cash flow generated from the Group’s sterling operations leaving the Group with a net 
investment in sterling assets. The 17% reduction in the value of sterling against the euro during the year ended 31 March 2008 gave rise to a 
translation loss of €64.3 million on the translation of the Group’s sterling denominated net asset position at 31 March 2008 as set out in the 
Statement of Total Recognised Gains and Losses. €16.0 million of this amount related to the Group’s sterling denominated intangible assets. 

The Group has a moderate level of transactional currency exposure arising from sales or purchases by operating units in currencies other than 
their functional currencies. Where sales or purchases are invoiced in other then the local currency and there is not a natural hedge with other 
activities within the Group, DCC generally hedges between 50% and 90% of those transactions for the subsequent two months. The Group 
also hedges approximately 50% of anticipated transactions in certain subsidiaries generally for periods up to 6 months with such transactions 
qualifying as ‘highly probable’ forecast transactions for IAS 39 hedge accounting purposes.

Sensitivity to currency movements:
Group
A change in the value of other currencies by 10% against the euro would have a €8.3 million (2007: €7.0 million) impact on the Group’s profit 
before tax, would change the Group’s equity by €42.6 million and change the Group’s net debt by €4.8 million (2007: €41.8 million and €5.0 
million (net cash) respectively). These amounts include an immaterial amount of transactional currency exposure.

Company
The Company does not have significant levels of non-functional currency assets and liabilities at 31 March 2008 or at 31 March 2007.

Interest rate risk management
On a net debt basis, the Group is exposed to changes in interest rates, primarily changes in EURIBOR and sterling LIBOR. Having borrowed 
at both fixed and floating rates of interest, DCC has swapped its fixed rate borrowings to floating interest rates, using interest rate and cross 
currency interest rate swaps. Overall interest rate risk on gross borrowings is mitigated by matching, to the extent possible, the maturity of its 
cash balances with the interest rate reset periods on the swaps related to its borrowings. 

Sensitivity of interest charges to interest rate movements:
Group
Based on the composition of net debt at 31 March 2008 a one percentage point (100 basis points) change in average floating interest rates 
would have a €1.24 million (2007: €1.01 million) impact on the Group’s profit before tax.

Company
The effective interest rates earned during the year on cash at bank ranged from 3.6% to 4.7%. 

Commodity price risk management
The Group is exposed to commodity price risk in its LPG and oil distribution businesses. The Group generally hedges a proportion of its 
anticipated LPG commodity exposure while price changes are being implemented, with such transactions qualifying as ‘highly probable’ 
forecast transactions for IAS 39 hedge accounting purposes. Certain customers occasionally require fixed price oil supply contracts generally 
for periods of less than one year. In such circumstances, the Group enters into matching forward commodity contracts, not designated as 
hedges under IAS 39. All commodity hedging counterparties are approved by the Board.

 
110

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Notes to the Financial Statements
(continued)

48. Related party transactions
The principal related party relationships requiring disclosure in the consolidated financial statements of the Group under IAS 24 Related Party 
Disclosures relate to the existence of subsidiaries, joint ventures and associates and transactions with these entities entered into by the Group 
and the identification and compensation of key management personnel as addressed in more detail below:

Group
Subsidiaries, joint ventures and associates
The consolidated financial statements include the financial statements of the Company and its subsidiaries, joint ventures and associates as 
documented in the accounting policies on pages 63 to 71. A listing of the principal subsidiaries, joint ventures and associates is provided in 
the Group Directory on pages 111 to 114 of this Annual Report. 

Transactions are entered into in the normal course of business on an arm’s length basis.

Sales to and purchases from, together with outstanding payables and receivables to and from subsidiaries and joint ventures are eliminated in 
the preparation of the consolidated financial statements. 

Compensation of key management personnel
For the purposes of the disclosure requirements under IAS 24, the term ‘key management personnel’ (i.e. those persons having authority 
and responsibility for planning, directing and controlling the activities of the Company) comprises the Board of Directors which manages the 
business and affairs of the Company. Full disclosure in relation to the compensation entitlements of the Board of Directors is provided in the 
Report on Directors’ Remuneration and Interests on pages 50 to 53 of this Annual Report.

Company
Subsidiaries, joint ventures and associates
During the year the Company received €230.000 million (2007: €38.999 million) in dividends from its subsidiaries and associates. Details of 
loan balances to/from subsidiaries are provided in the Company Balance Sheet on page 61, in note 24 ‘Trade and Other Receivables’ and in 
note 25 ‘Trade and Other Payables’.

During the year the Company was charged a management fee of €2.209 million (2007: €3.235 million) by its subsidiary, DCC Management 
Services Limited.

49. Approval of financial statements
The financial statements were approved by the Board of Directors on 9 June 2008.

DCC - ANNUAL REPORT AND ACCOUNTS 2008

111

Group Directory

Principal Subsidiaries and Joint Ventures

DCC Energy 
Company name & address  

DCC Energy Limited 
DCC House, Brewery Road, 
Stillorgan, Blackrock, 
Co. Dublin, Ireland 

Oil 
GB Oils Limited  
302 Bridgewater Place, 
Birchwood Park, 
Warrington WA3 6XG, England 

Emo Oil Limited 
Clonminam Industrial Estate, 
Portlaoise,  
Co. Laois, Ireland 

DCC Energy Limited 
Airport Road West, 
Sydenham,  
Belfast BT3 9ED, Northern Ireland 

LPG 
Flogas UK Limited 
81 Raynsway, 
Syston,  
Leicester LE7 1PF, England 

Flogas Ireland Limited 
Dublin Road, 
Drogheda,  
Co. Louth, Ireland 

Fuel Cards 
Fuel Card Group Limited 
8 Kerry Hill, 
Horsforth, 
Leeds LS18 4AY, England 

DCC SerCom
Company name & address  

SerCom Distribution Limited 
DCC House, Brewery Road, 
Stillorgan, Blackrock, 
Co. Dublin, Ireland 

Retail 
Gem Distribution Limited 
St. George House, Parkway,  
Harlow Business Park, Harlow, 
Essex CM19 5QF, England 

Principal activity  

Contact details

Holding and divisional management  
company 

Procurement, sales, marketing and  
distribution of petroleum products 

Procurement, sales, marketing and  
distribution of petroleum products 

Procurement, sales, marketing and  
distribution of petroleum products 

Procurement, sales, marketing and  
distribution of liquefied petroleum gas 

Procurement, sales, marketing and  
distribution of liquefied petroleum gas 

Sale of motor fuels through fuel cards 

Tel: +353 1 2799 400
Fax: +353 1 2831 017
Email: energy@dcc.ie
www.dcc.ie 

Tel: +44 1925 858 500
Fax: +44 1925 858 501
Email: info@gboils.co.uk
www.gboils.co.uk 

Tel: +353 578 674 700
Fax: +353 578 674 775
Email: info@emo.ie
www.emo.ie 

Tel: +44 28 9073 2611
Fax: +44 28 9073 2020
Email: enquiries@emooil.com
www.emooil.com

Tel: +44 116 2649 000
Fax: +44 116 2649 001
Email: enquiries@flogas.co.uk
www.flogas.co.uk 

Tel: +353 41 9831 041
Fax: +353 41 9834 652
Email: info@flogas.ie
www.flogas.ie 

Tel: +44 1132 390 490
Fax: +44 1132 098 764
Email: info@fuelcard-group.com
www.fuelcard-group.com 

Principal activity  

Contact details

Holding and divisional management  
company 

Tel: +353 1 2799 400
Fax: +353 1 2831 017
Email: sercom@dcc.ie
www.sercomdistribution.com   

Procurement, sales, marketing and  
distribution of computer software  
and peripherals 

Tel: +44 1279 822 800 
Fax: +44 1279 416 228
Email: info@gem.co.uk
www.gem.co.uk 

Tel: +353 1 2826 444
Fax: +353 1 2826 532

Pilton Company Limited 
Unit 2, Loughlinstown Industrial Estate, 
Ballybrack, Co. Dublin, Ireland 

Procurement, sales, marketing and  
distribution of DVDs and computer  
games and accessories 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
112

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Group Directory
(continued)

DCC SerCom (continued)
Company name & address  

Principal activity  

Contact details

Banque Magnetique SAS 
Park International d’Activités, Paris Nord II, 
8 Avenue de la Pyramide, BP 64060, 
Tremblay en France 95972, Roissy, France 

Procurement, sales, marketing and  
distribution of computer peripherals  
and accessories 

Tel: +33 1 49 90 93 93
Fax: + 33 1 49 90 94 94
Email: sales@banquemagnetique.fr
www.banquemagnetique.fr

Reseller   
Micro Peripherals Limited 
Shorten Brook Way, Altham Business Park,   distribution of computer products 
Altham, Accrington, 
Lancashire BB5 5YJ, England 

Procurement, sales, marketing and  

Procurement, sales, marketing and  
distribution of computer products 

Distribution of enterprise infrastructure  
products in France, Iberia & Benelux 

Tel: +44 1282 776 776
Fax: +44 1282 770 001
Email: enquiries@micro-p.com
www.micro-p.com 

Tel: +353 1 4087 171
Fax: +353 1 4193 111
Email: sharptext@sharptext.com
www.sharptext.com   

Tel: +33 1 34 58 47 00
Fax: + 33 1 34 58 47 27
Email: info@distrilogie.com
www.distrilogie.com  

Provision of supply chain management 
and procurement services 

Tel: +353 1 4056 500
Fax: +353 1 4056 555
Email: kevin.vaughan@sercomsolutions.com
www.sercomsolutions.com 

Principal activity  

Contact details

Holding and divisional management  
company 

Tel: +353 1 2799 400
Fax: +353 1 2831 017
Email: healthcare@dcc.ie
www.dcc.ie 

Procurement, sales and marketing of  
pharmaceutical, medical and laboratory  
products and provision of related  
value-added services 

Tel: +353 1 2907 000
Fax: +353 1 2954 777
Email: information@fannin.ie
www.fannin.ie 

Provision of value-added distribution  
services to hospitals and healthcare 
providers 

Tel: +44 1246 470 999
Fax: +44 1246 284 030

Sharptext Limited 
M50 Business Park, 
Ballymount Road Upper,  
Dublin 12, Ireland 

Enterprise 
Distrilogie SA  
Energy Park IV,  
34 Avenue de l’Europe 
78140 Velizy, France 

Supply Chain Management  
SerCom Solutions Limited 
M50 Business Park,  
Ballymount Road Upper,  
Dublin 12, Ireland 

DCC Healthcare
Company name & address  

DCC Healthcare Limited 
DCC House, Brewery Road, 
Stillorgan, Blackrock, 
Co. Dublin, Ireland 

Acute Care 
Fannin Limited 
Fannin House,  
South County Business Park,  
Leopardstown, Dublin 18, Ireland 

Squadron Medical Limited 
Unit A, Griffen Close, 
Ireland Industrial Estate, Staveley, 
Chesterfield S43 3LJ, England 

The TPS Healthcare Group Limited 
27-35 Napier Place, 
Wardpark North, Cumbernauld, 
Glasgow G68 0LL, Scotland 

Provision of value-added distribution  
services to hospitals and healthcare  
providers 

Tel: +44 1236 739 668
Fax: +44 1236 738 376
Email:corporate@tpshealthcare.com
www.tpshealthcare.com 

Health & Beauty Solutions     
DCC Health & Beauty Solutions 
9-12 Hardwick Road, 
Astmoor Industrial Estate, Runcorn, 
Cheshire WA7 1PH, England 

Outsourced solutions for the health 
and beauty industry 

Tel: +44 1928 573 734
Fax: +44 1420 566 566
Email: enquiries@dcchealthandbeauty.com
www.dcchealthandbeauty.com

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

113

Group Directory (continued)

DCC Healthcare (continued)
Company name & address  

Laleham Healthcare Limited 
Sycamore Park, 
Mill Lane, Alton, 
Hampshire GU34 2PR, England 

Thompson & Capper Limited 
9-12 Hardwick Road, 
Astmoor Industrial Estate, Runcorn, 
Cheshire WA7 1PH, England 

EuroCaps Limited 
Crown Business Park, 
Dukes Town, Tredegar, 
Gwent NP22 4EF, Wales 

Mobility & Rehab   
Days Healthcare UK Limited 
North Road, 
Bridgend Industrial Estate, 
Bridgend CF31 3TP, Wales 

Physio-Med Services Limited 
7-23 Glossop Brook Business Park, 
Surrey Street, Glossop, 
Derbyshire SK13 7AJ, England 

Days Healthcare GmbH 
Oberbecksener Str. 68,  
D-32547 Bad Oeynhausen, 
Germany 

Ausmedic Australia Pty Limited 
Unit 4, 37 Leighton Place,  
Hornsby,  
NSW 2077, Australia 

DCC Food & Beverage
Company name & address  

DCC Food & Beverage Limited 
79 Broomhill Road, 
Tallaght,  
Dublin 24, Ireland 

Healthfoods 
Kelkin Limited 
Unit 1, Crosslands Industrial Park, 
Ballymount Cross,  
Dublin 12, Ireland 

Indulgence  
Robert Roberts Limited 
79 Broomhill Road, 
Tallaght,  
Dublin 24, Ireland 

Principal activity  

Contact details

Contract manufacture and packing of  
nutraceuticals and cosmetics  
(liquids and creams) 

Tel: +44 1420 566 500
Fax: +44 1420 566 566
Email: reception@laleham-healthcare.com
www.laleham-healthcare.com 

Development, contract manufacture and  
packing of tablet and hard gel capsule  
nutraceuticals 

Tel: +44 1928 573 734
Fax: +44 1928 580 694
Email: enquiries@tablets2buy.com
www.tablets2buy.com 

Development and contract manufacture  
of soft gel capsule nutraceuticals 

Development, procurement, sales and  
marketing of mobility and rehabilitation  
products 

Procurement, sales and marketing of  
rehabilitation products 

Development, procurement, sales and  
marketing of mobility and rehabilitation  
products 

Procurement, sales and marketing of  
mobility and rehabilitation products 

Tel: +44 1495 308 900
Fax: +44 1495 308 990
Email: info@softgels.co.uk
www.softgels.co.uk   

Tel: +44 1656 664 700
Fax: +44 1656 664 750
Email: info@dayshealthcare.com
www.dayshealthcare.com 

Tel: +44 1457 860 444
Fax: +44 1457 860 555
Email: sales@physio-med.com
www.physio-med.com 

Tel: +49 5731 786 50
Fax: +49 5731 786 520
Email: info@dayshealthcare.de
www.dayshealthcare.de

Tel: +61 2 9477 3422
Fax: +61 2 9477 3522
Email: sales@ausmedic.com
www.ausmedic.com  

Principal activity  

Contact details

Holding and divisional management  
company 

Procurement, sales, marketing and  
distribution of branded healthy foods,  
beverages and vms products 

Procurement, sales, marketing and  
distribution of food and beverages 

Tel: +353 1 4047 300
Fax: +353 1 4599 369
Email: foods@dcc.ie
www.dcc.ie 

Tel: +353 1 4600 400
Fax: +353 1 4600 411
Email: info@kelkin.ie
www.kelkin.ie 

Tel: +353 1 4047 300
Fax: +353 1 4599 369
Email: info@robt-roberts.ie
www.robt-roberts.ie  

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
   
 
 
 
 
 
114

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Group Directory
(continued)

DCC Food & Beverage (continued)
Company name & address  

Principal activity  

Bottle Green Limited 
19 New Street, 
Horsforth,  
Leeds LS18 4BH, England 

KP (Ireland) Limited * 
79 Broomhill Road, 
Tallaght, 
Dublin 24, Ireland 

Logistics  
Allied Foods Limited 
Second Avenue, 
Cookstown Industrial Estate, 
Dublin 24, Ireland 

Other 
Kylemore Foods Group * 
McKee Avenue,  
Finglas, 
Dublin 11, Ireland 

DCC Environmental
Company name & address  

DCC Environmental Limited 
DCC House, Brewery Road, 
Stillorgan, Blackrock, 
Co. Dublin, Ireland 

Enva Ireland Limited 
Clonminam Industrial Estate, 
Portlaoise,  
Co. Laois, Ireland 

Wastecycle Limited 
Enviro Building, Private Road No. 4, 
Colwick Industrial Estate, 
Nottingham NG4 2JT, England 

William Tracey Limited * 
49 Burnbrae Road, Linwood,  
Paisley, Renfrewshire  
PA3 3BD, Scotland 

* 50% owned joint venture

Procurement, sales, marketing and  
distribution of wine 

Manufacture of snack foods 

Chilled and frozen food distribution 

Operation of restaurants and contract  
catering 

Contact details

Tel: +44 113 2054 500
Fax: +44 113 2054 501
Email: info@bottlegreen.com
www.bottlegreen.com 

Tel: +353 1 4047 300
Fax: +353 1 4599 369

Tel: +353 1 466 2600
Fax: +353 1 466 2688
Email: info@alliedfoods.ie

Tel: +353 1 814 0600
Fax: + 353 1 814 0601
Email: info@kylemore.ie
www.kylemore.ie 

Principal activity  

Contact details

Holding and divisional management  
company 

Specialist waste treatment/management  
services 

Recycling and waste management company 

Recycling and waste management company 

Tel: +353 1 2799 400
Fax: +353 1 2831 017
Email: environmental@dcc.ie
www.dcc.ie 

Tel: +353 578 678 600
Fax: +353 578 678 699
Email: info@enva.ie
www.enva.ie 

Tel: +44 115 9403 111
Fax: +44 115 940 4141
Email: enquiries@wastecycle.co.uk
www.wastecycle.co.uk 

Tel: +44 1505 321 000
Fax: + 44 1505 335 555 
Email: info@wmtracey.co.uk
www.wmtracey.co.uk 

 
 
  
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

115

Shareholder Information

Share price data 

Share price movement during the year  
- High 
- Low 

Share price at 31 March 
Market capitalisation at 31 March 

Share price at 4 June 
Market capitalisation at 4 June 

Shareholder analysis as at 31 March 2008

2008 
€ 

26.48 
14.78 

14.95 
1,208m 

16.10 
1,309m 

2007 
€

28.00
17.68

26.36
2,120m

Range of shares held 

Number of accounts 

% of accounts 

Number of Shares1  

% of shares

Over 250,000 
100,001 – 250,000 
10,001 – 100,000 
Less than 10,000 

Total 

44 
45 
181 
3,265 

3,535 

1.2 
1.3 
5.1 
92.4 

63,515,750 
7,455,979 
6,002,016 
3,841,420 

100.0 

80,815,165 

78.6
9.2
7.4
4.8

100.0

Geographic division2 

Number of Shares1  

% of shares

Ireland 
UK 
North America 
Europe/Other 
Retail3 

Total 

16,066,778 
18,951,965 
24,896,254 
6,681,250 
14,218,918 

80,815,165 

19.9
23.4
30.8
8.3
17.6

100.0

1  Excludes 7,414,239 shares held as Treasury Shares.
2  This represents the best estimate of the number of shares controlled by fund managers resident in the relevant geographic regions.
3  Retail includes private shareholders, management and broker holdings.

Share listings
DCC’s shares are traded on the Irish 
Stock Exchange and the London Stock 
Exchange. DCC’s shares are quoted on the 
official lists of both the Irish Stock Exchange 
and the UK Listing Authority.

ISIN: IE0002424939
ISE Xetra: DCC plc
Bloomberg: DCC ID, DCC LN

Website - www.dcc.ie
Through DCC’s website, stakeholders 
and other interested parties can access 
information on DCC in an easy-to-follow 
and user-friendly format. As well as 
information on the Group’s activities, users 
can keep up to date on DCC’s financial 
results and share price performance 
through downloadable reports and 
interactive share price tools. The site also 
provides access to archived financial 
data, annual reports, stock exchange 
announcements and investor presentations.

Registrar
All administrative queries about the holding 
of DCC shares should be addressed to 
the Company’s Registrar, Computershare 
Investor Services (Ireland) Limited, Heron 
House, Corrig Road, Sandyford Industrial 
Estate, Dublin 18, Ireland. 

Tel: + 353 1 247 5698
Fax: + 353 1 216 3151 
E-mail: web.queries@computershare.ie

Amalgamation of accounts
Shareholders who receive duplicate sets 
of Company mailings owing to multiple 
accounts in their names may write to the 
Company’s Registrar to have their accounts 
amalgamated.

Dividends
Shareholders are offered the option 
of having dividends paid in euro or 
pounds sterling. Shareholders may also 
elect to receive dividend payments by 
electronic funds transfer directly into 
their bank accounts, rather than by 
cheque. Shareholders should contact the 
Company’s Registrar for details.

Dividend Withholding Tax (“DWT”)
The Company is obliged to deduct tax at 
the standard rate of income tax in Ireland 
(currently 20%) from dividends paid 
to its shareholders, unless a particular 
shareholder is entitled to an exemption 
from DWT and has completed and returned 
to the Company’s Registrar a declaration 
form claiming entitlement to the particular 
exemption. Exemption from DWT may be 
available to shareholders resident in another 
EU Member State or in a country with which 
the Republic of Ireland has a double taxation 
agreement in place and to non-individual 
shareholders resident in Ireland (e.g. 
companies, pension funds and charities). 

An explanatory leaflet entitled “Dividend 
Withholding Tax – General Information 
Leaflet” has been published by the Irish 
Revenue Commissioners and can be 
obtained by contacting the Company’s 
Registrar at the above address. This leaflet 
can also be downloaded from the Irish 
Revenue Commissioners website at www.
revenue.ie. Declaration forms for claiming 
an exemption are available from the 
Company’s Registrar.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
116

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Shareholder Information
(continued)

CREST
DCC is a member of the CREST share 
settlement system. Shareholders may 
continue to hold paper share certificates 
or hold their shares in electronic form. 
Shareholders should consult their 
stockbroker if they wish to hold shares in 
electronic form.

Annual General Meeting
The 2008 Annual General Meeting will 
be held at The Four Seasons Hotel, 
Simmonscourt Road, Ballsbridge, Dublin 
4, Ireland on Friday 18 July 2008 at 11.00 
a.m. The Notice of Meeting together with an 
explanatory letter from the Chairman and a 
Form of Proxy accompany this Report.

Financial calendar
•   Preliminary results announced  

19 May 2008

•   Ex-dividend date for the final dividend   

28 May 2008

•    Record date for the final dividend  

30 May 2008

•   Annual General Meeting 

18 July 2008

•   Proposed payment date for final dividend 

24 July 2008

•   Interim results announced  

November 2008

•   Payment date for the interim dividend 

December 2008

Electronic proxy voting  
and CREST voting
Shareholders may lodge a Form of Proxy 
for the 2008 Annual General Meeting via 
the internet. Shareholders who wish to 
submit their proxy in this manner may do 
so by accessing the Company’s Registrar’s 
website at www.computershare.com/ie/
voting/dcc and following the instructions 
which are set out on the Form of Proxy. 

CREST members who wish to appoint a 
proxy or proxies via the CREST electronic 
proxy appointment service should refer to 
footnote 3 of the Notice of Annual General 
Meeting for instructions on how to do so.

Investor relations
For investor enquiries please contact Conor 
Murphy, Investor Relations Manager, DCC 
plc, DCC House, Brewery Road, Stillorgan, 
Blackrock, Co Dublin, Ireland.

Tel: + 353 1 2799 400 
Fax: + 353 1 2799 422
email: investorrelations@dcc.ie

 
Corporate Information

Auditors 
PricewaterhouseCoopers  
Chartered Accountants
& Registered Auditors 
One Spencer Dock
North Wall Quay
Dublin 1
Ireland

Registrar
Computershare Investor Services 
(Ireland) Limited 
Heron House 
Corrig Road 
Sandyford Industrial Estate 
Dublin 18
Ireland

Bankers
ABN AMRO Bank
Allied Irish Banks
Bank of Ireland
Barclays
BNP Paribas
Deutsche Bank
IIB Bank
KBC Bank
Royal Bank of Scotland 
Ulster Bank 

Solicitors
William Fry 
Fitzwilton House
Wilton Place
Dublin 2
Ireland 

DCC - ANNUAL REPORT AND ACCOUNTS 2008

117

Registered and Head Office 
DCC House
Brewery Road
Stillorgan
Blackrock
Co. Dublin
Ireland

Stockbrokers
Davy
49 Dawson Street 
Dublin 2
Ireland 

JPMorgan Cazenove Limited
20 Moorgate 
London EC2R 6DA 
England

  
118

DCC - ANNUAL REPORT AND ACCOUNTS 2008

Index

Accounting Policies 

Accounting Records 

Acquisitions and Organic Development Expenditure 

Analysis of Net Debt 

Articles of Association 

Attendance at Meetings 

Audit Committee 

Auditors 

Balance Sheet and Group Financing 

Board Changes 

Board Committees 

Board of Directors 

Borrowings 

Business Combinations 

Business Reviews 

Capital and Treasury Shares 

Capital Expenditure Commitments 

Cash and Cash Equivalents 

Cash Flow 

Cash Generated from Operations 

Chairman’s Statement 

Chief Executive’s Review 

Commitments under Operating and Finance Leases 

Commodity Price Risk Management 

Company Balance Sheet 

Company Cash Flow Statement 

Company Statement of Recognised Income and Expense 

Contents 

Contingencies 

Corporate Governance 

Corporate Information 

Corporate Social Responsibility 

Credit Risk Management 

Critical Accounting Estimates and Judgments 

DCC Energy 

DCC Environmental 

DCC Food & Beverage 

DCC Healthcare 

DCC SerCom 

Deferred Acquisition Consideration 

Deferred Income Tax 

Derivative Financial Instruments 

Directors 

Directors’ and Company Secretary’s Interests 

Page

34

43

12

94

43

45

44

43

36

8

44

4, 44

92

104

14

42

103

91

36

102

8

10

103

39

61

62

62

1

102

44

117

13, 40

39

71

14

30

26

22

18

98

95

91

42

53

Directors’ Emoluments and Interests 

Directors’ Remuneration 

Dividend increase 

Dividends 

Divisional Highlights 

Earnings per Ordinary Share 

Employee Share Options 

Employment 

Environment, Health & Safety 

Equity Share Capital 

Exceptional Profit 

Exceptionals 

Finance Costs and Finance Income 

Financial Review 

Financial Risk and Capital Management 

Financial Risk management 

Financial Strength 

Foreign Currency 

Foreign Exchange Risk Management 

Fyffes Case 

Government Grants 

Group at a Glance 

Group Balance Sheet 

Group Cash Flow Statement 

Group Directory 

Group Income Statement 

Group Operating Profit 

Group Statement of Recognised Income and Expense 

Highlights 

Income Tax Expense 

Intangible Assets 

Interest Rate Risk and Debt/Liqudity Management 

Inventories 

Investments in Associates 

Investments in Subsidiary Undertakings 

Key Performance Indicators 

Management and Staff 

Minority Interest 

Movement in Total Equity 

Movement in Working Capital 

Page

77

50

8

36,42, 85

11

85

79

79

41

99

11

82

83

34

106

38, 71

12

83

38

8, 44, 47

99

2

59

60

111

57

77

58

1

84

87

39

89

88

89

34

9

101

101

90

 
 
 
 
 
 
DCC - ANNUAL REPORT AND ACCOUNTS 2008

119

Index

Nomination Committee 

Non-executive Chairman 

Notes to the Financial Statements 

Other Operating Income/Expenses 

Other Reserves 

Outlook 

Overview of Results 

Political Contributions 

Principal Risks and Uncertainties 

Principal Subsidiaries and Joint Ventures 

Profit Attributable to DCC plc 

Property, Plant and Equipment 

Proportionate Consolidation of Joint Ventures 

Provisions for Liabilities and Charges 

Related Party Transactions 

Remuneration Committee 

Remuneration Policy 

Report of the Directors 

Report of the Independent Auditors 

Report on Directors’ Remuneration and Interests 

Research and Development 

Results Highlights 

Results Overview 

Retained Earnings 

Retirement Benefit Obligations 

Return on Capital Employed 

Review of Activities and Events since Year End 

Segment Information 

Senior Management 

Shareholder Information 

Share of Associates’ Profit after Tax 

Share Options 

Share Premium Account 

Strategy Review 

Substantial Shareholdings 

Trade and Other Payables 

Trade and Other Receivables 

Page

45

44

63

77

100

9,13

34

43

42

42

85

86

78

98

110

45, 50

50

42

55

50

43

10

8

100

95

36

42

72

6

115

83

52

100

13

43

90

89

 
 
 
120

DCC - ANNUAL REPORT AND ACCOUNTS 2008

5 Year Review

Group Income Statement 
Year ended 31 March 

Irish GAAP 

2004 
€’m 

IFRS 

2005 
€’m 

IFRS 

2006 
€’m 

IFRS 

2007 
€’m 

IFRS

2008
€’m

Revenue 

2,089.4  

2,644.7  

3,436.3  

4,046.1  

5,532.0 

Operating profit before operating exceptional  
items and amortisation of intangible assets 

Operating exceptional items 
Amortisation of intangible assets 
Operating profit 
Finance costs (net) 
Share of associates’ profit after tax 
Non-operating exceptional items 
Profit before tax 
Income tax expense 
Minority interests 
Profit attributable to Group shareholders 

Earnings per share 
- basic (cent) 
- basic adjusted (cent) 

101.6  
(2.3) 
(8.3) 
91.0  
(3.8) 
15.8  
(5.9) 
97.1  
(12.0) 
(0.8) 
84.3  

109.3  
(16.0) 
(1.2) 
92.1  
(5.7) 
19.3  
(4.8) 
100.9  
(12.1) 
(1.0) 
87.8  

121.0  
2.8  
(4.9) 
118.9  
(7.0) 
28.1  
(1.2) 
138.8  
(13.5) 
(1.5) 
123.8  

140.1  
24.5  
(6.7) 
157.9  
(10.8) 
14.7  
-  
161.8  
(20.7) 
(0.9) 
140.2  

167.2 
39.6 
(7.9)
198.9 
(17.8)
0.6 
- 
181.7 
(16.5)
(0.7)
164.5 

101.98 
121.89 

109.68 
137.22 

153.92 
157.23 

174.59 
160.02 

204.28
165.06

Dividend per share (cent) 

32.40 

37.26 

42.85 

49.28 

56.67

Dividend cover (times) 

Interest cover (times) 

Group Balance Sheet 
As at 31 March 

Non-current and current assets 
Property, plant and equipment 
Intangible assets 
Investments in associates 
Cash/derivatives 
Other assets 
Total assets 

Equity 
Non-current and current liabilities 
Borrowings/derivatives 
Retirement benefit obligations 
Other liabilities 
Total liabilities 
Total equity and liabilities 

3.8  

26.7  

IFRS 

2004 
€’m 

218.6  
131.4  
42.0  
323.5  
434.2  
1,149.7  

3.7  

19.2  

IFRS 

2005 
€’m 

254.8  
208.1  
51.4  
353.3  
541.1  
1,408.7  

3.7  

17.2  

IFRS 

2006 
€’m 

267.5  
248.5  
76.8  
354.4  
665.4  
1,612.6  

3.2  

12.9  

IFRS 

2007 
€’m 

319.6  
321.4  
90.3  
340.2  
783.1  
1,854.6  

2.9 

9.4 

IFRS

2008
€’m

337.1 
416.9 
4.7 
512.7 
1,037.3 
2,308.7 

462.8  

492.2  

585.4  

687.7  

742.4 

261.1  
17.2  
408.6  
686.9  
1,149.7  

362.2  
25.4  
528.9  
916.5  
1,408.7  

387.1  
20.7  
619.4  
1,027.2  
1,612.6  

440.7  
16.4  
709.8  
1,166.9  
1,854.6  

636.4 
21.9 
908.0 
1,566.3 
2,308.7 

Net cash/(debt) included above 

62.4  

(8.9) 

(32.7) 

(100.5) 

(123.7)

Group Cash Flow 
Year ended 31 March 

Operating cash flow 
Capital expenditure 
Acquisitions 

Other Information 

Return on tangible capital employed (%) 
Return on total capital employed (%) 

Irish GAAP 

2004 
€’m 

151.9  
32.1  
14.5  

Irish GAAP 

2004 

39.8% 
21.3% 

IFRS 

2005 
€’m 

116.4  
43.6  
81.2  

IFRS 

2005 

44.9% 
20.4% 

IFRS 

2006 
€’m 

142.9  
57.7  
54.7  

IFRS 

2006 

43.0% 
19.1% 

IFRS 

2007 
€’m 

127.4  
60.7  
105.7  

IFRS 

2007 

38.9% 
17.9% 

IFRS

2008
€’m 

129.0 
87.5 
176.6 

IFRS

2008

38.0%
17.5%

Working capital (days) 

11.6  

10.2  

9.5  

14.0  

16.4 

Average number of employees 

3,768 

4,746 

5,109 

5,653 

6,638

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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DCC plc
DCC House, Brewery Road,
Stillorgan, Blackrock,
Co. Dublin, Ireland.
Tel:  + 353 1 279 9400
Fax: + 353 1 283 1017
Email: info@dcc.ie
www.dcc.ie

P R I N T E D   O N   E N V I R O N M E N T A L L Y   F R I E N D L Y   P A P E R