Happy anniversary to DCC, which has just completed two decades as a listed company, albeit having decamped to London in recent years, leaving the Dublin stock exchange bereft of a seriously successful business.
As a highly diversified conglomerate, DCC has a little bit of everything. It sells, among other things, home-heating oil, liquid gas, iPods, Xboxes, coffee beans, health and beauty products, recycling facilities and wine. It is like a cross-section of an entire economy. So what can DCC’s performance tell us about the health of the Irish economy?
Just over 8 per cent of DCC’s business takes place in Ireland these days – about £910 million (€1.1 billion) from its overall revenue of £11.2 billion. But the auld sod accounts for about 11 per cent of its profits, so the home fires are clearly burning brighter than in some of its other territories.
It is easy to see which of DCC’s divisions is performing most strongly: technology consumer products, where organic growth is racing ahead as consumers gain in confidence. But most of that division is in Britain and Europe, so its performance specifically in Ireland is more difficult to ascertain.
Volumes in its fuel division, however – DCC sells plenty of oil in Ireland – are ahead on an organic basis by 3 per cent. Fuel sales are a good barometer of an economy’s overall health.
More economic activity means more fuel requirements for homes and businesses, even with the mild winter that handicapped DCC’s sales. So, good news there.
Tommy Breen, DCC's mild-mannered chief executive, says the performance of the Irish business is "improving steadily", but most of its attention is on the UK. But even good news there is good for Ireland.
If British consumers buy more tablet computers from companies such as DCC, that's good for the likes of Apple, which employs hundreds of people in Cork. More smartphones, more games consoles, more electronic goods . . . all of the big manufacturers have operations in Ireland.
If DCC is on the way up, chances are Ireland will not be far behind it.
