01732 759725 16 DISTRIBUT ION DCC’s latest full-year results show the benefits of diversity within the Group and within the DCC Technology division “The most pleasing thing about these results is they show us finding a way to win in exceptional circumstances. The team have done extraordinary things to be able to get us to deliver a fantastic set of results. Obviously, there is an interesting mix. Part of our investment hypothesis is around diversity, so we have a diverse set of results. But I always say business is a team sport and being able to get over the line collectively has been really, really pleasing,” he said. US expansion He singled out December’s acquisition of Almo Corporation – DCC’s biggest acquisition to date – as a key development that has already made a significant contribution to the division’s financial performance. “Almo was a $1.3 billion revenue business and is a significant contributor to the bottom line. With the benefit of a full year of Almo being on board, we’re confident we will be able to continue to drive our growth story in 2022.” The acquisition has effectively doubled the size of DCC Technology’s North American operations, by increasing its footprint in the Pro AV space and giving it a presence in consumer appliances distribution and AV e-commerce. “We had a business in the Pro AV space that was marginally smaller than Almo’s Pro AV division. Put them together and you’ve got a Pro AV business generating north of $1 billion,” explained Griffin. “In addition, Almo had three other divisions: two in the appliances space, differentiated by channel and price point – dealership and premium, and a third focused on e-commerce and a variety of large format products that go through that channel.” Add in DCC Technology’s previous acquisitions of consumer electronics, musical instruments and pro audio distributor Jam Industries in 2018, pro audio and musical accessories distributor The Music People in 2020 and broadcast solutions value added distributor JB&A in 2021, and North America now accounts for around one quarter of DCC Technology’s revenues. A challenging market The UK was a more challenging market for DCC Technology in 2021, thanks to a variety of factors including supply chain difficulties, the pandemic, labour/skills shortages, inflation, the effects of Brexit, all of which impacted demand. There were also teething problems with Exertis’ new warehouse management system, which Griffin has high hopes for going forward. “We made significant investments in infrastructure that are really setting us up for success in the future. They had their own complexities, but we’re delighted with the outcome in terms of operational improvements and being able to deliver for tomorrow’s consumer. I’m pretty excited about what’s coming next,” he said. Griffin added that taking advantage of that infrastructure to react quickly to changing market needs is one of his priorities for the UK in 2022, along with the development of some of the company’s specialist businesses. “We have a very strong enterprise and Pro AV business in the UK and seeing us really taking share in both those areas is going to be important. I think also that whole sustainability agenda is going to come to the fore and through other specialist businesses of ours, like our MTR business, which provides a second life for mobile phones, we are well placed to take that story to our customers and give them a solution,” he said. As ever, DCC Technology will aim to supplement organic growth with acquisitions. Last year DCC committed £600 million to the cause, and Griffin will continue to look out for new opportunities in 2022. “We don’t tend to carve up a pot at DCC level and say right that’s for DCC Technology, that’s for DCC Healthcare and so on. Instead, it’s very much driven by opportunity. Obviously, we were able to bring opportunities to the table that meant we got a disproportionate share of the pot last year and I remain ambitious to get my fair share of that pot moving forward. Acquisition is an important part of our journey, but so is organic growth and we like the two to be evenly balanced.” DCC Technology, the technology distribution division of international sales, marketing and support services group DCC, contributed to strong group performance for the year to 31 March 2022, with a 12.8% rise in adjusted operating profit to £81.7 million (19.9% on a constant currency basis) driven to a great extent by the acquisitions of French cabling distributor Azenn at the end of June and US Pro AV giant and domestic appliances distributor Almo Corporation in December. The challenging macro environment meant that DCC Technology experienced a more modest 3.8% rise in revenue to £4.644 billion (up 6.4% on a constant currency basis). In the UK, trading under the Exertis name, revenue and operating profit fell due to supply constraints, problems with the company’s new warehouse management system and reduced demand. The DCC group as a whole, including the LPG, Retail & Oil, Healthcare and Technology divisions, saw a 32.2% rise in annual revenue to £17.732 billion and an 11.1% increase in adjusted operating profit to £589.2 million (up 35.9% and 15.1% respectively on a constant currency basis). Tim Griffin, Managing Director of DCC Technology, told Technology Reseller that these results are testament to DCC Technology’s resilience, which is partly a product of its diversity. Swings and roundabouts Tim Griffin
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