Domino is a global business exposed to a wide variety of markets and market forces. The use of our products is often driven by legislation or mandate – the requirement placed upon our customers to identify their products – but our products themselves, in particular the fluids we manufacture and supply, are also subject to regulatory or legislative controls. The use of solvent based fluids is an area we continue to manage as legislation increases around control over the use and transportation of these materials.
The broad spread of our customers by country and by market sector and the nature of use of our products in everyday basic product manufacture all have a positive effect on diversifying risk. However, as a public company listed in London and reporting in sterling but generating revenues and costs in many local currencies we do have exposure to changes in exchange rates. The translation of local results into sterling for group reporting can create material differences when comparing results from one period to the next. The Group uses derivative instruments (forward contracts) to provide some hedge against the effects on transactions in different currency but does not protect against the impact on profits of translation differences.