Dis-Chem records market share gains across all core categories in half year

DIS-CHEM, the JSE-listed beauty and pharmaceutical retailer, recorded market share gains across its core categories during the half-year ended August, underscoring growth trajectory.

Dis-Chem, which opened its 200th store last month, yesterday posted market share gains in dispensary, health care and nutrition, personal and beauty care, as well as baby care segments.

“Despite a tough economic environment with the pandemic and deepening economic recession, the group has achieved positive results, continued to take market share in all categories and delivered strong cash generation,” chief executive Ivan Saltzman said.

During the 12 months ended August 2021, 18 Dis-Chem and three Baby City stores were opened, resulting in 199 DisChem and 35 Baby City stores at the end of August 2021.

“These stores together with the Baby City stores acquired on January 1, 2021, contributed R822 million to revenue. The group opened its 200th Dis-Chem store in October,” Saltzman said.

Financial highlights for the period included the 17.3 percent increase in wholesale revenue to R10.9 billion, a 16.6 percent jump in group revenue to R14.9m and a 19.5 cents a share interim dividend declared based on 40 percent of headline earnings.

Saltzman said between September 1 and October 3, group revenue grew by 19.2 percent over the prior comparable period. However, despite the revenue growth the outlook for the company’s performance will largely depend on the financial muscle of consumers.

“The group expects that the consumer will continue to remain constrained,” said Saltzman.

He said the group would focus on return on invested capital, the resilient nature of the markets in which it operates, together with the brand position to help mitigate the challenges.

Dis-Chem was not spared from the negative impact of the looting mayhem in KwaZulu-Natal and parts of Gauteng in July. The group said it was able to reopen affected stores due to sufficient insurance cover and management commitment.

Commenting on the results, Euromonitor analyst Christopher Day said the performance of Dis-Chem during the second half of 2021 was strongly tied to the local economic environment and the impact of Covid-19.

Day said strong market share growth was seen by dispensaries and health care and nutrition, in large part thanks to the company’s continued expansion and increasing consumer demand for preventive and immune-boosting medicines.

dineo.faku@inl.co.za

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