DCC improves as private equity circles

DCC (DCC) was almost left out of the private equity rush, announcing its own break-up plan last year which will leave the listed entity as just the energy business. But at the end of last month, Energy Capital Partners and KKR knocked on the door of the Irish company. 

This was in the form of a full buyout at £58 per share, or around £5bn. DCC rejected the offer as too low, but the shares have remained above that level in the weeks since. 

The results for the 12 months were indicative of the change in motion, with the £700mn handed to shareholders more eye-catching than the 3.6 per cent rise in adjusted operating profit to £634mn. DCC sells liquid gas and runs service stations, with just under half of its operating profit coming from continental Europe. This will keep rising, after £110mn in acquisitions in that region in the past year.

The 2026 financial year captured the start of the Iran conflict, raising sales in March as DCC customers bought up supplies in readiness for potential fuel shortages.

The company also noted a better second half, with operating profit climbing 8 per cent after a decline in the first six months of the financial year. The growth was led by the larger energy solutions and products divisions, while the solar and storage-focused unit registered a fall in operating profit of two-thirds, to £48mn.

Management has framed the March buying as a ‘pull-forward’ rather than an increase in buying, so there may be lower sales in the first half of FY2027 to balance it out. Peel Hunt is forecasting a minor rise in cash profits for the year. There is also another £100mn in buybacks on the way. Buy.

Last IC view: Buy, 4,734p, 12 Nov 2025