New Clicks Group — fastmoving.co.za

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TRADING UPDATE FOR THE FOUR MONTHS ENDED DECEMBER 2007

HIGHLIGHTS

· Total sales up 13.1%
· Real growth of 9.3%
· Retail sales up 11.3%
· UPD turnover up 13.2%

TRADING PERFORMANCE

New Clicks increased sales by 13.1% for the four months ended December 2007. While tighter consumer expenditure impacted retail sales growth all the businesses performed well, with a strong merchandising offer that was well executed.

The business unit split is as follows:

Four months to December 2007 (Rm) Four months to December 2006 (Rm) Total sales growth

(%) Same store sales growth (%) Inflation (%)
Clicks 2 149 1 938 10.9 9.4 4.1
Musica 397 354 12.2 7.3 2.8
The Body Shop 38 31 22.3 10.9 4.8
Total retail 2 584 2 323 11.3 9.1 3.9
UPD 1 558 1 376 13.2 3.6
Less intragroup turnover (255) (264) (3.3)
Total group 3 887 3 435 13.1 3.8

RETAIL TRADING

Clicks continued to generate real growth in turnover, led by the health category and supported by strong beauty sales. General merchandise showed lower growth, but recorded market share gains in key sub-categories. Clicks again benefited from a strong Christmas gifting offer across the business.

Musica experienced strong Christmas trading with a good schedule of new releases which was supported by an impactful marketing campaign. This followed weaker trading in September/October owing to a lack of new releases. The DVD and gaming categories continue to lead growth and market share has increased.

The Body Shop continued to show excellent growth, with a well-received gifting offer, despite having anniversaried the launch of the make-up range in September 2006. The brand also benefited from the opening of four new stores in the last financial year and a new store in Eastgate in October 2007.

UPD

UPD continued to gain market share, with sales of ethical products to hospitals and Clicks pharmacies driving growth. UPD also benefited from the launch of the Link Pharmacy initiative and increased distribution sales in this trading period.

UPD has entered into an agreement to acquire Kalahari Medical Distributors, one of Botswana’s leading pharmaceutical wholesalers, for approximately R5 million, which will assist in the development of UPD’s export business in the SADC region.

CONCLUSION

New Clicks expects retail trading conditions to remain tough. The group’s stock levels and markdowns are in line with expectations and management is confident of achieving the strategic objectives and targets set out in the 2007 annual report.

NOTES

1) The information contained in this trading update has not been reviewed or reported on by the group’s auditors. New Clicks’ interim results for the six months to 29 February 2008 will be released on SENS on or about 24 April 2008.

2) The information contained in this trading update does not include the results of the Discom business unit, which was sold in September 2007.

3) The decline in intragroup turnover reflects the relocation of the majority of front shop healthcare products from UPD to the Clicks distribution centres with effect from 1 March 2007.

	ClicksAR06.pdf
	New Clicks has made marked progress over the past six months in its turnaround strategy to achieve sustainable performance, while at the same time investing in the growth of the business to ensure long-term competitiveness and shareholder value creation. The group has produced a much improved operational and financial performance, with progress in certain areas being ahead of the objectives set by the board at the outset of the turnaround programme in early 2006.

	clicks_ar_2007.pdf
	Clicks continues to reap the benefits of a focused merchandise strategy and produced consistent sales growth through the year, with strong Christmas gifting sales and pleasing dispensary trading over the winter period.

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