Annual Report and Accounts 2006 - DCC plc

42report of the directorsfor the year ended 31 March 2006The Directors of DCC plc presenttheir report and the audited financialstatements for the year ended 31March 2006.Group resultsThe profit for the financial yearattributable to Group shareholdersamounted to €123.8 million as setout in the Group Income Statementon page 51.DividendsAn interim dividend of 15.54 cent pershare, amounting to €12.50 million,was paid on 1 December 2005. TheDirectors recommend the payment ofa final dividend of 27.31 cent pershare, amounting to €22.04 million.Subject to shareholders’ approval atthe Annual General Meeting on 10July 2006, this dividend will be paidon 14 July 2006 to shareholders onthe register on 26 May 2006. Thetotal dividend for the year ended 31March 2006 amounts to 42.85 centper share, a total of €34.54 million.The balance of profit attributable toGroup shareholders, which is retainedin the business, amounts to €92.2million.Purchase of shares andtreasury sharesThe number of shares held inTreasury at the beginning of the year(and the maximum amount held) was7,873,886 (8.92% of the issued sharecapital) with a nominal value of€1.968 million.A total of 363,708 shares (0.41%of the issued share capital) with anominal value of €0.091 million werere-issued during the year at pricesranging from €6.22 to €12.20consequent to the exercise of shareoptions under the DCC plc 1998Employee Share Option Scheme andthe DCC Sharesave Scheme 2001,leaving a balance held in Treasury at31 March 2006 of 7,510,178 shares(8.51% of the issued share capital)with a nominal value of €1.878 million.At the Company’s Annual GeneralMeeting on 5 July 2005, the Companywas granted authority to purchase upto 8,822,940 of its own shares (10%of the issued share capital) with anominal value of €2.206 million. Thisauthority has not been exercised andwill expire on 10 July 2006, the dateof the next Annual General Meetingof the Company. A special resolutionwill be proposed at the Annual GeneralMeeting to renew this authority.Review of activities andevents since the year endThe Chairman’s Statement on pages10 to 11, the Chief Executive’sReview on pages 12 to 13, theOperating Review on pages 16 to 25and the Financial Review on pages28 to 32 contain a review of thedevelopment of the Group’s businessduring the year, of the state of affairsof the business at 31 March 2006,of recent events and of likely futuredevelopments. Information in respectof events since the year end as requiredby the Companies (Amendment) Act,1986 is also included in these sections.Principal risks anduncertaintiesUnder Section 13 of the Companies(Amendment) Act, 1986 as amendedby Statutory Instrument 116 of 2005 -European Communities (InternationalFinancial Reporting Standards andMiscellaneous Amendments)Regulations 2005, DCC is required togive a description of the principal risksand uncertainties facing the Companyand the Group.As detailed throughout this AnnualReport, DCC’s businesses operate ina broad range of business areas. Thisbroad business base means that theGroup is not exposed to significantrisks connected with any particularindustry. DCC has a broad customerbase and the profitability of theGroup is not dependent on any singlecustomer. Similarly, DCC has a broadsupplier base and the Group iscommitted to ensuring that supplierscontinue to choose DCC as thepartner of choice, however, no onesupplier would be considered materialto the Group.The principal risks and uncertaintiesfaced by the Group’s businessesrelate to the macro economicenvironment in Ireland, Britain andContinental Europe. The level ofactivity in these markets is sensitiveto economic conditions generally,including, inter alia, economic growth,interest rates and inflation.During 2006, the price of a barrel ofoil reached record prices on worldmarkets. DCC Energy is the Group’slargest profit contributor and constantand rigorous margin managementis maintained.The principal financial risks facing theGroup are addressed in the FinancialReview under ‘Financial RiskManagement’ on pages 31 to 32.The Group has a comprehensivesystem of risk management andinternal controls as detailed under‘Internal Control’ in the CorporateGovernance section of this Reporton pages 38 to 41.Subsidiary, joint ventureand associated companiesDetails of the Company’s principaloperating subsidiaries, principal jointventures and principal associates areset out on pages 113 to 116.