Dis-Chem gains market share as store rollout continues
By Karl Gernetzky - Nov 7th, 09:55
Dis-Chem Pharmacies said on Thursday it was continuing its store expansion programme, eyeing additional market share in a part of the retail sector that has proved resilient in the face of SA’s weak economy.
Group revenue rose 13.2% to R11.8bn during its six months to end-August, with the integration of Western Cape wholesaler Quenets helping external revenue from wholesale grow 28.5%.
Revenue growth continued to be ahead of market growth, with the company saying it was benefiting from its maturing store base and had improved market share across all core categories.
“As we have reiterated, commercial decisions made are for the long-term benefit of group growth considering the position of our brand within a resilient, consolidating market,” CEO Ivan Saltzman said in a statement.
During the period, the company rolled out 20 new stores and acquired two pharmacies, bringing its total base to 158 at the end of the period.
Four more stores have been added since the end of August, while the company is planning to open seven more stores by the end of February 2020.
Headline earnings per share fell 38.9% to 31c, however, due to accounting changes that have brought leases onto the balance sheet. The company also faced various once-off costs, including a change to the group’s bonus policy, where employees’ 13th cheques are now expensed across the financial year, rather than in December.
The company has decided that accounting changes should not affect its dividend, declaring a gross cash dividend of 12.8c, which is a 38.2% decline from the prior comparative period.
The dividend is based on 40% of headline earnings, excluding the effect of accounting changes.Business Live
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