Hello everyone, welcome to the DCC plc Interim Results Presentation. My name is Seb, and I will be the operator for your call today. There will be an opportunity to ask questions. Please note that questions will be taken only from the audio conference. You can register a question by pressing star one on your telephone keypad, or press star two to withdraw your question. I will now hand the floor to Donal Murphy, Chief Executive, to begin the call. Please go ahead. Thank you, Seb. Good morning, everybody, and welcome to DCC's interim results presentation for the six months ended the 30th of September 2022. I am Donal Murphy, Chief Executive at DCC, and I am joined here this morning by Kevin Lucey, our Chief Financial Officer. Just our disclaimer. Thankfully, I do not have to read it, but just for your information. I am going to cover off the highlights for the first half of the year, which is another period of strong growth and development activity for the group. Kevin will take you through the business and financial review. I will give you an update on our strategy and our development activity. After a summary and our outlook, we will open up the session for questions and answers. DCC delivered strong growth in the seasonally less significant first half of our financial year to the 30th of September 2022. We are really pleased with the performance, given the ongoing challenges in the global commodity markets and the general macroeconomic environment. Group adjusted operating profit increased by 13% to GBP 221.2 million. Adjusted EPS increased by 9.1%. The board proposes to increase the interim dividend by 7.5% to GBP 0.6004 per share. The strong performance of the group during the period, yet again, demonstrated the resilience in DCC's business model, the benefit of our diverse sectors of energy, healthcare, and technology, our strong market positions, and most importantly, the essential nature of the products and services that DCC provides to its customers every day. We made good progress in delivering on our capital allocation priorities. During the period, we committed approximately GBP 300 million to acquisitions in DCC Healthcare and Services and Renewables within DCC Energy. In DCC Healthcare, we completed the acquisition of Medi-Globe, creating a platform of scale in the European medical devices sector. Medi-Globe is DCC's largest acquisition in healthcare to date. Within Services and Renewables, DCC Energy made three significant acquisitions. PVO, a leading European distributor of solar panels and related technologies. Protech Group, providing a range of renewable and energy-efficient heating solutions to commercial customers in the U.K. market. Freedom Heat Pumps, one of the U.K.'s largest distributors of air source heat pumps. These acquisitions help us with our ambition to build a material position in the European healthcare sector and to ensure we are leading with energy by reducing our customers' carbon emissions. Last May, we announced our Leading with Energy strategy, and we have made great progress on its implementation since then, which I will take you through a little bit later in the presentation. We have been bringing innovative low-carbon energy solutions to our commercial and industrial, domestic, and Mobility customers. We have significantly expanded our energy Services and Renewables offerings and capabilities during the period and grown our contribution from this area significantly. We have set our ambition to reduce our Scope 3 emissions by circa 15% by 2030, to net zero across Scope 1, 2, and 3 by 2050 or sooner. We are well on track to achieving these goals. I will hand you over to Kevin now, who will take you through the business and financial highlights. Kevin. Thanks, Donal, good morning, everybody. For the next few minutes, we'll look at the performance in the first half at both the group and divisional level. As Donal mentioned, the first half in DCC is seasonally less significant from an activity and profitability perspective. Typically accounts for about a third of our profits on an annual basis. That being said, it is very good to be reporting strong growth in first half operating profits in line with our expectations overall. As you know, revenue is not always the most relevant metric for DCC, given our operating model in our Energy division. In the first half, we obviously saw significantly different energy environments, with the cost of energy commodities significantly ahead of where they were in the prior year. That increase in the cost of the commodities drove the very strong growth in revenues in the first half at a group level. Group adjusted operating profit was GBP 221.2 million, 13% ahead of the prior year and 10.7% ahead on a constant currency basis. We'll come back and talk about the divisional contributions to that, but following very strong organic growth in the prior year, operating profit was organically in line with the prior year. Adjusted EPS growth was a strong 9.1%, with the delta to operating profit growth being a higher effective tax rate and interest cost. The effective tax rate at 19.5% reflects our expectation for the full year and has increased a little on prior year as the group grows internationally. Interest costs were also increased, reflecting the increased scale of the group, but also the interest rate environment presently. The board has increased the interim dividend by 7.5%, as Donal mentioned, which again, will hopefully be welcomed by shareholders this morning. Net debt, excluding leases, was GBP 780 million, which reflects the substantial acquisition spend across the last 12 months and the usual seasonal increase in working capital. A quick look now at how that performance breaks out by division. You'll see that overall, we had a modest currency headwind in the Energy division and then a tailwind across both Healthcare and Technology. At a group level, currency translation contributed about 2.3%, or just over GBP 4 million of the growth in the first half. The macro environment is obviously quite different this year. We're all getting used to different types of volatility, be it COVID-led or COVID rebound or supply chain volatility. We've had a first half dominated by significant volatility in the energy market, and clearly inflation is elevated across all markets we operate within right now. Our teams have done a very good job managing through this environment. On the inflation side, we've been very focused on being as efficient as we possibly can and trying to deliver as much self-help on the cost side as we can. In line with our distribution business model, we've also had to be very active in passing cost increases through the business. On an organic basis, at a group level, our costs were about 8% higher than prior year, really reflecting increased energy and transport costs. There's some activity-led increase in there across the energy business, but it is mostly led by the higher energy and transport costs. I've mentioned already, H1 is seasonally less significant, and on the right-hand side here, you will see that share of the profits coming from energy were about 60% of the group in H1, with roughly 20% coming from both technology and healthcare. Now we'll have a look at what drove the performance across each of the divisions on the next slide. Operating profit growth in DCC Energy increased by 11.9%, and the majority of this was organic. We did have modest incremental contribution coming through in mobility from our Luxembourg convenience operations, and in Energy Solutions, from the acquisition of Naturgy Ireland, which has performed strongly since acquisition. Volumes were up 1.9%, driven by the acquisitions that I've just mentioned. Also what we saw in Q1 was a bit of a rebound, as Q1 of the prior year still had quite a few restrictions on hospitality and commercial volumes. In Mobility in Q2, we saw the impact of reduced in-region holidaying or vacationing. There was less holidaymakers in cars on the motorways of Europe this year relative to the prior year, as people enjoyed the resumption of air travel for holiday this summer. Profit growth was strong across the Energy Solutions business, 14.9% ahead of prior year. The business performed well across most markets in continental Europe and the U.K. and Ireland in particular. The natural gas and power market in France remained volatile and was a drag for the business overall. Other than that, we were very pleased with the performance. We saw very strong growth on the Services and Renewables elements of the business, with good progress across our solar offerings and in the development of further bio or renewable products and services. Dónal will pick up on some of these initiatives a little later in the presentation. The Mobility business also performed well in H1, with profits up 7.7%. I mentioned earlier some of the dynamics across the volume performance in the half. Again, here we saw solid performances across all markets really. In France, the business performed well in a challenging operating environment, and also continued to see good progress on the development front, integrating the business in Luxembourg and driving out the cleaner fuels and EV infrastructure in the motorway network. Similarly, in the Nordic region, the business was good, and we doubled the number of EV fast chargers in the region in the six months. In the U.K., the business saw good profit growth in our roadside services, lubricants, and truck stop offering. A strong performance overall across DCC Energy. In DCC Healthcare, we had operating profits of GBP 43.2 million, 13.9% below the prior year. We were expecting the first half to be difficult, given the particularly strong comparatives in the first half of the prior year and some reduction in COVID-related sales prior to elective procedures in healthcare settings returning to full capacity. Across DCC Vital, we did see the impact of lower COVID-related sales, and whilst we did a good job at capturing the pickup in underlying business in the healthcare systems, it's fair to say that the healthcare systems across the markets we operate in are not yet back to full capacity. The business is performing really well, and we saw good growth in non-COVID categories year-on-year, and from the addition of Medi-Globe from the second half really gives us a strong platform now across medical devices to grow from. The health and beauty business was impacted generally in Europe and the U.S. by continued supply chain disruption and labor availability, which impacts the capability of our operations to efficiently meet customer demands. Demand was weaker in Europe than in the U.S. We saw some element of destocking by customers following the very significant growth of recent years. We saw good growth in effervescent nutrition products in the U.S., which is a big category for us. And the business continues to invest in its operational capacity and capability, and we remain excited by the long-term growth opportunity in the health and beauty sector. Our healthcare business now is significantly larger business over the last couple of years following an organic and acquisitive growth period. Whilst we were anticipating the first half to be difficult, given the items I mentioned, we're very excited by the opportunity in front of our healthcare business over the medium and longer term. Even in the shorter term, we see the business growing organically again in the second half, and obviously we also will have the Medi-Globe business coming in. Finally, in DCC Technology, we recorded very strong growth in first half, with operating profits up 67%, or 52.7% on a constant currency basis. The growth was driven by the material acquisition of Almo, which we completed in December of the prior year. Organically, the performance was mixed. We saw good demand for higher margin B2B products like ProAV and ProAudio, and we saw that across North America and Europe. Demand on the consumer product side was weaker and more pronounced in the U.K. and Europe as the impact of consumer confidence and cost of living began to impact demand. We did also see some of this impact in the U.S. also, where we saw in categories such as air conditioning, where weather was benign, which impacted demands, but also we saw across some of the cheaper products, in particular, seeing a more pronounced demand impact. At the higher end of consumer products, like the more expensive appliances and smartphones, for example, demand has been more resilient. Overall, very strong growth in DCC Technology, driven by the acquisition of Almo, a little weaker organically with the e-tail and retail channel kind of weakest there. Finally, just to reiterate, strong growth in profits overall for DCC in the first half, and the business and balance sheets are in good shape as we head into the second half. Lots of macroeconomic uncertainty around, but DCC remains very well positioned to continue its growth and development. I'll hand back to Donal now. Thanks, Kevin. I'll give you an update on our strategy and development activity and the progress that we're making with the implementation of our Leading with Energy strategy. DCC is a purpose-led organization, and we're focused on the value we create for all our stakeholders. We focus on creating sustainable growth and superior value over the long term, and our diversified model provides significant expansion opportunities. We achieve this through a consistent strategic objective to build a growing, sustainable, and cash-generative business, which consistently provides returns on capital employed significantly ahead of our cost of capital. We take a long-term, sustainable view of value creation, which ensures our commercial strategies prioritize growth and create value-adding strategic positions in our chosen markets. Our focus on capital allocation ensures our ability to reinvest into growth trends, and our capital allocation priorities are aligned with the growth trajectories of each of our sectors. We have winning strategies for each of our sectors. In energy, our strategy is to accelerate the net zero journey of our customers by leading the sales, marketing, and distribution of low-carbon energy solutions. In healthcare, our strategy is to build a leading healthcare business, providing products and services to health and beauty brand owners and healthcare providers. Finally, in technology, our strategy is to be a leading specialist distributor of technology and lifestyle products in our chosen markets. We made really good progress against our strategic objectives during the first half of the year. As outlined last May, by pursuing our group's strategy and deploying capital in line with our priorities, the size and shape of DCC will be very different by 2030. By 2030, we will have more than doubled the size of the group, and approximately 70%-75% of our profitability will come from our technology, healthcare, and energy Services and Renewables activities. We are making really good progress against this objective, and our development activity during the period further demonstrates this, with approximately GBP 300 million committed to acquisitions in DCC Healthcare and Services and Renewables within DCC Energy. In healthcare, we recently completed the acquisition of Medi-Globe, creating a platform of scale in the European medical devices sector. Medi-Globe is DCC's largest acquisition in healthcare to date. Medi-Globe is focused on single-use medical devices used in minimally invasive diagnostic and therapeutic procedures, mainly in gastroenterology and urology. It represents a further material expansion of DCC Vital's presence in the European healthcare market, following our expansion into the European primary care market through the acquisition of Wörner in April 2021. The acquisition is based on an enterprise value of approximately EUR 245 million on a cash-free, debt-free basis. Together with DCC Vital's existing own branded medical device activity, the acquisition of Medi-Globe creates an international platform of scale in single-use devices. The acquisition also creates meaningful synergy opportunities, in particular through leveraging DCC Vital and Medi-Globe's respective product portfolios and commercial infrastructures. We are really excited about the opportunities to scale our business in medical devices. Within service and renewables, DCC Energy made three significant acquisitions. We recently completed the acquisition of PVO International, a leading distributor of solar panels, inverters, batteries, and associated products to commercial, industrial, and domestic energy sectors across continental Europe. PVO was established in 2014 and has grown rapidly to become one of the leading solar solution providers in Europe, with a market-leading position in the Benelux and growing positions in eight other European countries, including Germany, Poland, and Finland. PVO is an excellent strategic fit for DCC. It leverages PVO's established market position in the fast-growing solar PV market and DCC Energy's knowledge and expertise in transitioning customers to cleaner energy products and services. DCC Energy acquired Protech Group in June 2022. Established in 2008, Protech Group provides a wide range of renewable and energy-efficient heating solutions to commercial and industrial customers in the U.K. The acquisition of Protech strengthens the range of low carbon and renewable technologies for customers in the U.K. market. In October, DCC Energy completed the acquisition of Freedom Heat Pumps, one of the U.K.'s largest distributors of air source heat pumps and accessories required for the installation into residential properties. Freedom has approximately 400 active customers, including heat pump installers, builders merchants, and smaller distributors. The acquisition gives DCC a strong foothold in the growing heat pump market, a segment of the market that we believe will play an important role in the decarbonization of heating in the years to come. We announced our Leading with Energy strategy last May, and we have made really good progress on its deployment since then. We have implemented our new divisional structure, creating DCC Energy, which has two reporting segments, Energy Solutions and Mobility. We have also implemented our new regional management structure. On the 1st of November, Fabian Ziegler joined us as CEO of DCC Energy. Fabian has extensive senior leadership experience in the energy sector, having held various senior management roles in Shell during his 26-year career. Most recently, he was responsible for Shell's business upstream, downstream, power and renewables in the DACH region, with a particular focus on leading their energy transition strategy. The breadth of Fabian's leadership experience in the energy sector, coupled with his ambition to drive the energy transition, will, I have no doubt, enable DCC to accelerate its Leading with Energy strategy. Just picking up on a few other highlights from our Leading with Energy initiatives. Both organically and as just outlined through acquisition, we have made good progress in expanding our range of solar, renewable heat and power, consulting, and heat pump solutions. The former Naturgy Ireland business, now Flogas Enterprise, performed strongly since acquisition, leveraging its biogas, renewable electricity, energy consulting, and solar solutions. As Kevin mentioned, we have doubled the number of fast chargers during the first half in the Nordic region, continued to roll out HVO to customers across the U.K. and Ireland, launched our Danish heat pump solution, and delivered over 250 solar installations in France. We're pretty pleased with the progress that we're making in our Leading with Energy strategy. Just before opening up to Q&A, in summary, DCC delivered strong growth and development in the first half of the year. The group continues to perform well despite the ongoing challenges in global commodity markets and the general macroeconomic environment. The strong performance of the group during the period yet again demonstrates the resilience in DCC's business model, the benefit of our diverse sectors of energy, healthcare, and technology, our strong market positions, and most importantly, the essential nature of the products and services that DCC provides to its customers every day. We have made good progress in delivering on our capital allocation priorities. During the period, we committed approximately GBP 300 million to acquisitions in DCC Healthcare and Services and Renewables within DCC Energy. With our active acquisition pipeline and strong financial position, we are very well-placed to continue to deliver against our capital allocation ambitions. Sustainability and energy transition is at the heart of everything we do, and we are making really good progress implementing our Leading with Energy strategy and expanding our range of energy services and renewable offerings. Finally, our outlook statement. DCC expects that the year ended 31 March 2023 will be another year of growth and development, notwithstanding the challenging macroeconomic environment at present. We leave you with our favorite slide to highlight DCC's strategy continues to deliver. This strategy, over our 28 years as a public company, has delivered a consistent track record of growth, operating profit growing 14.1% CAGR, EPS growth 11.8% CAGR, an unbroken growth in dividends increasing 13.7% CAGR, free cash flow conversion of 100%, consistently high returns on capital employed, significantly ahead of our cost of capital. Thank you all for listening, and we look forward to your questions. Thank you. As a reminder to ask a question, please press star one on your telephone keypad or press star two if you wish to withdraw your question. First question today comes from Oscar Val from JP Morgan. Please go ahead. Yes. Good morning, Donal and Kevin. I have three questions. The first one, if we start with the division that was probably a bit weaker than we thought, which is technology, could you discuss what you're seeing into the second half in the B2B part of the business and consumer? It sounds like B2B has held up in H1, but how do you expect that to perform in the second half? The second one, again, is on technology. Could you give us some more color on the Almo acquisition from last year? Previously, you talked about that business delivering about GBP 57 million of EBIT last year. How does that look today, and how is that performing for the second half? Finally, on the energy division, you've had a strong start in H1, double-digit or close to double-digit organic. How do you see that into the second half in terms of September, October? We've had some news around French strikes. Is there anything to think about in the second half, or should we still think about DCC Energy in the second half growing strongly organically? Thanks, Oscar. Let me take them in the order that you gave them. I think on the technology side, certainly the B2B product area, and just to remind everyone, about 50% of our technology division is in the B2B space. That has been very resilient, and we believe that that will remain resilient across the various different aspects of our business, be it the ProAV sector, be it the enterprise infrastructure sector of the market. We certainly don't see that changing. Consumer, this is the one area that we've always talked about. Consumer, there's an element clearly of discretionary spend on the consumer products. That has been weaker, as Kevin pointed out, in the U.K., in Europe, a little bit probably of softness in the U.S., and we think that that will remain weak into the second half. Clearly, the biggest part of the consumer trading period is the next couple of months in the build-up to the Christmas trading period. We'll have pretty good visibility of that relatively shortly. Almo, maybe Kevin, do you want to take the Almo? Yeah, sure. Thanks, Oscar, for the questions. Firstly, I guess Almo is in the group since December last year. We are very pleased with how it has integrated into the group. The platform that it has provided us in North America is now very significant in terms of the continued growth and development of the group. I think from a performance perspective, the guys have done a brilliant job at, I guess, merging the ProAV operations of our existing business in North America with the Almo operations. That has gone live, went live in April, May time, which was only a number of months after we completed the acquisition and was done really excellently. That has been very well delivered, and we are very pleased with it. I think on the profitability side of things, obviously, Almo is not immune from the same sort of macro trends that we have seen across the business. We mentioned in the commentary earlier that we saw a little bit weaker demand on certain consumer products, particularly things like air conditioning, with a little bit of warmer weather, or, sorry, mild weather, I guess, and lower demand for air conditioning through the summer period. I guess then just in the consumer products area, generally, I think at the lower end of the market, we have definitely seen some weakness in the U.S., and Almo, I guess, is not immune from that. I suppose on a full year contribution basis, Oscar, to get to it, we would have expected maybe 12 months ago or in December that it would deliver about GBP 57 million in its first full year. Almo is likely to deliver somewhere between GBP 40 million and GBP 45 million, reflecting, I guess, the slightly weaker consumer side, but the business-to-business revenues and actually the higher end consumer appliances and consumer appliances side of the business generally performing very robustly. I guess, very pleased really with how the businesses have been integrated, the integration of our ProAV operations, and then, I would say a little bit of weakness on the e-tail and retail side, particularly in lower end consumer products, really just being the part that has been weaker. Thanks, Kevin. On the Energy side, Oscar, as you say, very strong performance in the first half of the year. The Energy business is in really good shape. I think there was probably some concerns in the market about the volatility on the commodity side and what impact that might have on our business. The teams across our Energy businesses have managed that really, really well. It has been tricky in France in, as you mentioned, in September and into October. Again, the teams, just great agility within the team, flexing our logistics capability, managing our retail network to keep our customers with product during the strikes, and performing very well. We are really upbeat about the second half of the year. I think it is a challenging world out there, but we have Energy businesses today that are serving over 9 million customers across 13 different countries. We have great diversity and resilience in that energy business. I think we're in good shape for the second half of the year. That's very useful. Thank you both. Thanks, Oscar. Our next question comes from Kate Somerville at UBS. Please go ahead. Hi, good morning. Thanks so much for taking my questions. Three from me, please. Firstly, on energy, 10% of your growth is coming from operating profit per liter. Can you give us any sort of additional color on the key components of this? Is this mostly your expansion into renewables and services? Is it mostly cost initiatives? Is it pricing power? Any more color around that would be great. Secondly, on the energy business, you used to flag sort of GBP 10 million-GBP 12 million EBIT swing from weather, and obviously your mix has changed a lot since then. Any update on what you think a potential weather swing could be, would be very helpful. Finally on healthcare, are you able to give us the exit rate from this division and also why you expect an acceleration? Is this mostly in health and beauty or in the retail business? Thanks. Thanks, Kate. All good questions. Obviously three is the magic number for questions today. Just starting on the energy side and the margin, I suppose in ways, as we continue to diversify out our energy businesses, the simple metric of margin per liter or equivalent is probably not a great metric in some ways because we are expanding, as you quite rightly say, in the renewable and services segment of the market. That has been a big driver of growth within the first half of the year. Some of those services clearly, where we put in solar or we put in heat pump solutions, or we're providing a range of services to our customers that don't have volumetric activity associated with it. You're seeing the benefit of that. We clearly had volume growth in the first half of the year, we're getting leverage from the volume growth we've had. As Kevin mentioned, the inflationary environment is pretty material. Again, the teams did a super job at managing our cost increases into the market. Overall, I think it's been a really good gross margin improvement performance in the first half. Mix is the biggest driver of that. The weather factor, Kate, you're going back well over a decade to when we had our issues with weather between our year end of 2011 and 2012. Back then, the business was really U.K. and Ireland business, it was much more a heating related business. The diversity that we have within the business across the different countries and continents that we operate within, and then the spread of our business, much more broadly based in terms of the commercial, industrial, domestic, and Mobility sides of our business gives us greater resilience. Look, weather is always going to be an impact. If it's colder than average, we'll get a benefit. If it's milder than average, we'll have a bit of a drag. As a percentage of our Energy profits, it's much more modest nowadays. We still focus on it. We like it when it's cold, but it's not the biggest driver of our business. Kevin, do you want to take the Healthcare? Sure. Thanks, Kate, again, for the question. I suppose on Healthcare, first thing to say is that you're right. We obviously include in the statement this morning, we've included some narrative in there around our expectation of a return to organic growth in H2. I suppose, in terms of how that comes about, I suppose the most material impact really, Kate, is that our H1 comparative in the prior year was particularly strong. I guess as FY 2023 goes on, those comparatives versus FY 2022 ease somewhat. That's a very relevant feature. I think we see growth coming from both sides of the business in H2, both on health and beauty, and a little bit on Vital. I guess from an exit rate perspective, we're very pleased with how the businesses are operating today. I think the easing of the comparatives and then continued pick up in healthcare systems on the DCC Vital side post the pandemic, and a little bit of return to a little easing on the labor availability side and supply chain volatility on the health and beauty side are all contributing factors to the growth in H2. Great. Yeah. Thank you very much. Thanks, Kate. Our next question comes from Maddy Jobber from Morgan Stanley. Please go ahead. Hi. Thank you. Excuse me. Hi. Thank you for taking my questions. I have three as well, please. Firstly, just on pricing, are you able to quantify what your price growth in healthcare and technology was for this half, and how you're expecting your sort of powerful price pass through and the level of price pass through you're expecting in the second half? Secondly, obviously you've mentioned the kind of volatility within the European energy market and the prices that we've seen recently. Are you expecting any structural shift in the demand for your different types of fuels following this? Finally, just on interest rate. I know you mentioned that potentially during these slightly more volatile times with interest rates rising, you are expecting a slightly larger headwind from interest costs in the future. Considering you have quite a large proportion of your debt on floating rates, I believe it's about 60/40 floating to fixed, is this a level that you're happy sort of staying at for the time being, or is this something you'd like to shift towards more fixed rate debt in the future? Thank you. Thanks, Maddy. Maybe just starting on pricing, we have so many different products and categories and contract structures across the group. It's kind of probably not straightforward to give a simple answer to that. Overall, like DCC's business, we're a pass-through business. We buy and sell other people's products. Our business model is to pass through the cost increases and the price inflation that we're seeing within the products. That's the same in our health and beauty business where we contract manufacture on behalf of some of the world's leading brands. We've got to recover our cost increases in the price of the products that we produce on behalf of our customers. Clearly in the energy business, as we talked about earlier, the volatility in commodity prices, we have to move that into the market. I think, you've seen in the first half of the year that we've managed that very well. It's certainly not a slowness in any pricing activity. The reasons that healthcare and technologies, Kevin talked about, is demand related and COVID related. It's not to do with our inability to pass pricing on. We have had substantial inflationary increase in our own cost base, and we've managed that very effectively into the market. I think it's been well handled throughout the group. Just on the energy piece, lots of people have different views around the impact and the tragic events in Ukraine. On demand for energy and what will happen in terms of energy transition. Some people say it might slow things down a little bit. Some people might say, like our view is very clear that the world has got to move to lower carbon solutions, our strategy is to deliver for our customers lower carbon energy products and services. Fundamentally believe that everything we're seeing at the moment will accelerate the decentralization of energy production and take it away from more volatile environments. That plays to DCC's strength. Our strategy is very much aligned with that. We see and we hope that what we're seeing around the world will accelerate the energy transition. To deliver energy transition requires all the stakeholders working together, we work tirelessly through our industry bodies with government to ensure that the structures are put in place to accelerate decarbonization. It's crucial for the world, but it's also good business, and it's bang in line with our energy and leading with energy strategy. Hopefully we'll see that accelerate and that's certainly our view. Kevin, interest rates. Yeah. Maddy, to answer the question, I suppose there's a couple of points maybe to make. I suppose first thing is, yeah, you're correct. Obviously, the mix in terms of our gross debt position in DCC would be roughly 40% fixed, 60% variable. We've financed the group in that way consistently, really for the last 20 years or so, in that, we have not tried to call interest rate cycles specifically or taken views on what interest rates are likely to do in short, medium term. I guess we take a long term perspective on the financing of the group and a long term view in terms of the cost of capital associated with that. Whilst there'll always be rises and falls in interest rates, I guess over the longer term, whether you're fixed or variable, won't make a dramatic difference because the long term cost of capital for the group should be relatively consistent. Presently, obviously variable rates are increasing, as in they are fixed rates. I guess over the longer term, those kind of things tend to normalize out. I suppose from our perspective presently, whilst we will obviously have higher interest costs this year than last, I suppose we kind of think about this maybe almost as a period of opportunity for DCC because we do remain relatively lowly leveraged and lowly geared. We have very strong balance sheets. I guess when you have an M&A model and capability like we do in DCC, an environment like this where particularly in the sub-investment grade credit world or where PE might be financing transactions is definitely more difficult today. We'd like to think that some of the volatility caused by the interest rate movements actually provides opportunity for DCC and will mean that competitively we will be better positioned from an M&A perspective. There may even be some good businesses with bad balance sheets out there that may come to the market that wouldn't otherwise. We take a long term view on credit cycles and remain very strongly positioned from a balance sheet perspective and hopefully there'll be a little bit of opportunity in this cycle for us. Thanks, Maddy. Great. Thanks very much. Our next question is from Colin Grant at Davy. Please go ahead. Yeah. Thank you very much. Good morning, everybody. Just a couple of questions, please. Just following on from your last point there, Kevin, on the outlook for acquisition opportunities. I'm just wondering if there's any color you can give us in terms of whether or not you're seeing any new opportunities coming your way as a result of weakness in the market, whether or not prices have shifted in any way lower in terms of acquisition multiples, and whether or not you're seeing anything yet or is that more of a 2024 story? So a 2023 story, I should say. Maybe just start with that one. Then the second one was just to do with the Technology division, where 60% of the business is exposed to consumer, and there's been some weakness in the period that you've outlined in your press release there. Maybe you could just talk us through how that has kind of evolved through the period. Has it kind of continued to deteriorate through the period, or has it stabilized at all? Just kind of the visibility you have looking at that space going forward into H2. Thanks very much. Thanks, Colin. Maybe I'll take the acquisition one, and Kevin will pick up on the technology question. Just like, it takes a little bit of time, I think is the straight answer on people's views on valuation, Colin. Lots of the businesses that we acquire, we're trying to do them through bilateral negotiations. When you own a business, you only sell it once. People have a view of what it's worth. It takes time. I think, the point that Kevin was making is just so valid. Like, we compete for plenty of assets in the market. We take a long term view on returns. We're very returns oriented. That's the gating factor when we look at any investment opportunity. Within the market, in an uber low interest rate environment, some competitors for assets take a different view. Their funding costs are going to go significantly up. It's going to make it more difficult for them to justify You know that will definitely open up opportunities. Again, if we look back to these cycles in the past, and maybe one of the benefits of being around us for a little while is you go back and you look at it and when markets got tough, when interest rates were higher it actually created more opportunities for us. Today we have far more platforms for growth across the business than we've ever had before. I think it leaves us well positioned. It's not the next number of weeks. This will take a bit of time to play out. As we said earlier, we've an active acquisition pipeline and the outlook from a capital deployment perspective in this environment, for us, with the strong balance sheet gets a little bit rosier. Kevin. Yeah. Thanks, Colin. On the tech side, there's no doubt that where we sit today is a little bit tougher than where we started the year at on 1 April, for example. I think on the consumer side in technology that is. I think the outlook as we've gone through the year in terms of the impact of energy costs, the impact of increases in interest rates and what that was doing to people's discretionary spend has clearly increased. I think as the first half has unfolded obviously the outlook for consumer technology spend has disimproved. I think we are expecting H2 to be where it is at the moment, which is a pretty weak outlook from a technology spend perspective for consumers. I think obviously the next six to eight weeks, Colin, will tell an awful lot because an awful lot of technology consumer spend is over the holiday and gifting season from 1 November to 31 December. We wouldn't be expecting any pickup in performance relative to where we see things at the moment. Obviously we're talking to all the large retailers and retailers presently about their demand for the Christmas period. Look, I think the next six or eight weeks will tell a lot as we think about into Q4 and into next year. One thing we do know in technology is that people can't survive without us. While they may postpone discretionary spend for a period, the reality is if you break your smartphone, if you break your tablet, you will replace them. You will want the next new product when it becomes available. What we've seen in past cycles is that whilst you may have short-term disruption and you can see short-term declines, the trends in technology are for over the medium and longer term GDP plus levels of spending as people and businesses invest more in their technology capability. Again, short-term weakness perhaps, but we see no fundamental changes in the way these distribution models work, the way the distribution channels work in the technology and lifestyle product space. We remain very convinced about the opportunity to build a significant business here. However, we do expect the next couple of months to continue to be weak on the consumer technology side. Thanks, Colin. Great. Thanks very much. Our next question is from Christopher Bambury at Peel Hunt. Please go ahead. Morning, Donal and Kevin. Three questions, if I may. The margin in DCC Technology was up about 40 basis points in the first half. Could you give us a breakdown between what was kind of essentially, I guess, cost saving measures and perhaps anything from mix? Secondly, there was a GBP 25 million currency benefit in the first half. Presuming currencies stay where they are at the moment, what is your expectations for the full year? Finally, we also saw a bit of a pickup in CapEx. What are the key areas being of spend? What are your thoughts for CapEx for the full year this year? Would you expect similar levels of CapEx in FY 2024? Thanks. Sorry. Christopher, just that I think that there wasn't a GBP 25 million benefit from currency in the first half. It was probably kind of GBP 3 million to GBP 4 million benefit from currency in the first half. Just in case anyone gets focused on that. Just on the DCC Technology, like mix is probably a big element of the improvement in margin in DCC Technology. We have talked over the last number of reporting cycles on our focus on growing our business into the more specialist areas, higher margin areas. We see the benefit of that coming through. We have clearly, again, as we talked about earlier, had to deal with significant inflationary increases across the business as well, which we have managed well through. But it is principally coming from mix. Kevin. Yeah. Christopher, just a couple of things which might be helpful just to add to that. I think in the tech side, our cost performance has actually been very good. I think reflecting some of that weaker macro backdrop on the consumer side, clearly the business has been doing a good job at making sure that they are managing their costs well. That really has not been a feature at all. The costs have been very well managed in tech. Like for like costs are broadly flat across the tech division. The increase coming from mix. On the FX, Donal mentioned the H1 impact. I think if you look at spot rates presently, I won't give any view on where currency rates are moving over the next six months. If you were to look at kind of spot rates today and the average rate we have in the first half, you're probably looking at somewhere between a GBP 15 million and a GBP 20 million currency benefit for the full year. That may change as the year goes on. Calling it today, it's of that order. Finally on CapEx, I think we have a number of large development projects underway at the moment. We've probably had a disrupted couple of years of spend really over FY 2020 and FY 2021, 2022 due to, or 2021, 2022 due to COVID really, which would've impacted our level of development spend. I suppose significantly, CapEx at the moment in terms of spend would be across energy. We've got a lot of investment going into our LPG storage facility in Avonmouth in the U.K. A lot of EV infrastructure going in around the business. On the health and beauty side, we are investing significant capital in building out our capability for gummies, and facility expansion in the U.S. Quite a bit of development investment going into the business. CapEx, long-winded answer, Chris, CapEx roughly of the order of about GBP 200 million for the full year against depreciation of about GBP 150 million. Quite a bit of development spend going in to drive the organic performance of the business, and we'd expect to see a return on that in the coming years. Thanks, Chris. Thanks very much. The next question is from Gerry Hennigan from Goodbody. Please go ahead. Thanks. Donal, just on your comments there recently, or just previously with regard to the margins and the trend in PP, pence per liter in energy. I acknowledge it's probably less relevant going forward here. Can we infer or imply that some of the deal flow you have, particularly on the renewable side, is probably going to help that trend in terms of margins going forward, i.e., that it'll be higher margin business going forward for you? Also just on seasonality, because obviously seasonality has been a big issue in terms of energy in the past. Can we expect maybe those kind of business to be less seasonal than maybe your traditional energy business has been? Yeah, I think, Gerry, the short answer is probably yes to both. Definitely, as we build out our business in renewable and services and even the lower carbon areas, they're all higher margin activities. And as we talked about earlier, some of them very much kind of services that we're providing or installation that we're providing of products and service for our customers. Very high margin activity. We certainly would see that trend going forward. I think, there's no doubt, like, and even when you look at a lot of the renewable and services side, it's probably more steady state and indeed some of it may be more skewed towards the first half because if you're doing big installations of solar and Energy Solutions, it probably suits to do it in the kind of less severe elements of the year. We still have a business, like heating is a big element of the overall activities for our customers. It will be skewed towards the second half of the year. I think we'll see that probably spread a little bit more. Definitely the opportunities will lead to higher margin activity. And you'll see, when we presented the new energy strategy, we talked differently about the business. Last year, 22% of our profitability came from Services and Renewables. That's going to be an accelerating growing percentage of our energy activities. Our biogenic content is reducing our carbon intensity. You'll see lots of different metrics kind of coming out as the business grows and develops. Just a little more if I can, on Almo. Sorry. On Almo, can you give some details Donal, around contribution of Almo? I'm sorry, Gerry, could you just repeat that? Sorry. I don't know if you caught that or not. Yes. The contribution of Almo. Sorry, Kevin Lucey. I'm not sure you caught that. Can you give us some detail on the contribution of Almo? I know you said maybe air conditioning was a bit weak because of the weather constraints to that. In terms of where it's at and where you're with Almo, can you give us some idea in terms of the contribution in the first six months of the year, given it was a full contribution to H1? We had about GBP 20 million in contribution, Gerry Hennigan, in the first half, which reflected a very good ProAV performance and strong consumer appliances and premium appliances performance, obviously weaker on the fulfillment of e-tail, retail, lower-end consumer products. Thanks, Gerry. We're getting a little bit tight on time here. I think we've time for just one last question. Thank you. Our last question comes from Daniel Cowan from HSBC. Please go ahead. On cash flow- Apologies. Just had an issue opening your line there, Daniel. If you could just start again. Okay. Yeah, no worries. Hello. Can you hear me? Hi, Dan. Yeah, we can hear you. We can, yeah. All right. That's great. Thanks for squeezing me in. Just one question on cash flow. How you expect that to look for the full year and what that means for your net debt balance at the year end, please? Yeah. No bother, Dan. Thanks for the question. I think, I would expect the cash flow performance of the year to be a pretty typical one for DCC, Dan. We will have obviously small investment in CapEx ahead of depreciation, as talked about earlier. We would expect a modest working capital outflow of the order of GBP 30 million-GBP 50 million across the business. Our M&A spend clearly in the year to date, or in terms of what we have committed to thus far, is about GBP 330 million. I think at the free cash flow generation side, so CapEx and working capital investment, we're probably looking at somewhere between 80%-85% free cash flow conversion, reflecting some of that really the development side on CapEx. Investments to drive the organic performance of the group in coming years. I suppose when you boil that all down and post interest, post tax, post dividend, post acquisition spend, as I mentioned, you're probably looking at excluding IFRS 16. Excluding leases, you're looking at somewhere around GBP 700 million of net debt, which would be well under 1x net debt EBITDA. Balance sheet remaining very, very strong. That's super. Thanks, Dan. Thank you very much. Thank you. Super. I think we'll wrap it up there if that's okay. Just to reiterate, look, it really has been a period of strong growth and development for the group. We feel it's a challenging environment as we talked about earlier, but we feel DCC is in really good shape. We've delivered on our strategy. Our development activity has been good in the first half of the year. Notwithstanding those challenges in the market, we feel good about where we're positioned today and our ability to continue our growth and development going forward. Thank you all for all the questions today. Thank you all for listening, and we'll see many of you over the next number of days. Take care and have a good week. Bye.