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Dis-Chem Pharmacies Limited
(Incorporated in the Republic of South Africa)
(Registration number 2005/009766/06)
JSE share code: DCP
ISIN: ZAE000227831
('Dis-Chem' or 'the Group')
TRADING UPDATE FOR THE 22-WEEKS TO 2 FEBRUARY 2021
GROUP
Dis-Chem recorded Group revenue growth of 12.1% to R11.6bn for the 22-week period from 1
September 2020 to 2 February 2021 compared to the corresponding period in the prior year
('corresponding period')
Chief executive Ivan Saltzman: 'We are in a fortunate position in that we can continue to provide
our customers with quality service, competitive prices and an extensive range of products during
these very challenging times. The Group continued to show its resilience as the country experienced
the second wave of the COVID-19 pandemic.
It is encouraging to see, and a testament to the Dis-Chem brand's destination status, the significant
recovery in many of our older stores located in regional malls. This, coupled with our conveniently
located stores' excellent trade, has resulted in good sales growth over a challenging time where
consumers continue to search for value.
The change in consumer shopping behaviour due to COVID-19 continued to impact our sales mix and
in turn, our margins. Despite the strong top-line growth, margins are still lagging pre-COVID-19
levels.
Our online sales continue to be positively impacted as consumers prefer staying safe and shopping
from the comfort of their homes.
We are proud to continue to support South Africa's battle against COVID-19 with testing stations
located nationwide throughout our network of clinics, drive-through testing stations and at two key
airport locations. We have engaged, and are well prepared, to assist the State with the vaccine
rollout considering our differentiated clinic infrastructure.
Aside from trade, I would like to take this opportunity to thank all our staff for their proven
dedication and relentless commitment over the past unpredictable and challenging year. They
unceasingly faced the most testing of times to continue to deliver world-class service to keep our
company operating smoothly under unprecedented circumstances.
Recent months have proven that no company is untouched by COVID-19, and unfortunately, while
our staff showed unflinching dedication, Dis-Chem is no different. Every life lost during the
pandemic is a tragedy, and we are most saddened by colleagues and friends who lost their lives
helping South Africans fight this virus. On behalf of everyone at Dis-Chem, we pay tribute to them
and express our heartfelt condolences to the friends and families who have lost loved ones.'
RETAIL
Retail revenue increased by 10.3% to R10.4bn for the 22-weeks over the corresponding period.
Despite the weak macro environment, we continued to gain market share in all our core categories.
Healthcare, vitamins and chronic drug sales reported remarkable growth as consumers continue to
focus on preventative healthcare.
Like-for-like revenue growth and selling price inflation were 5.1% and 3.6%, respectively. We
welcome the recently gazetted Single Exit Price ('SEP') increase of 3.68%.
Table 1 below depicts the recovery in mall trade in the 2H to 2 February 2021 vs 1H21.
Table 1*
Malls 1 March 2020 ' 1 September 2020 '
31 August 2020 2 February 2021
Sales growth (8.0) (0.6)
Like-for-like sales growth (8.0) (2.0)
*excludes the 33 Baby City stores acquired on 1 January 2021
Table 2 depicts the continued strong growth in convenience centre stores.
Table 2*
Convenience centres 1 March 2020 ' 1 September 2020 '
31 August 2020 2 February 2021
Sales growth 16.2 16.6
Like-for-like sales growth 8.4 10.2
* excludes the 33 Baby City stores acquired on 1 January 2021
During the 22 weeks under review, the Group added ten new stores, contributing R123m to
revenue. Our new stores continue to trade above our expectations, validating our site selection
method. In addition, we opened two Dis-Chem Pharmacies on Mediclinic sites on 1 February 2021
and closed one underperforming store. We now have a store base of 193 stores excluding Baby City.
The 33 Baby City stores contributed R73.4m to retail revenue from 1 January 2021, the date from
which the transaction became effective, to 2 February 2021.
Online sales continued its strong trajectory and grew by 218.7% compared to the previous
corresponding period.
WHOLESALE
Wholesale revenue grew by 20.0% to R8.6bn for the 22 weeks over the corresponding period with
sales to our retail stores increasing by 18.5%.
External customers sales growth of 30.6% was driven by our growing distribution network and
greater support from The Local Choice ('TLC') and independent pharmacies which grew 30.4% and
30.8% respectively.
TLC's growing support from new and existing franchisees was underpinned by our excellent service,
competitive pricing, a more comprehensive range of products, and stock availability. We now have
117 TLC franchise stores versus 110 at the end of the corresponding period.
SUMMARY
Rm 22-weeks to 2 22-weeks to 2 % change % like-for-like % price
February 2021 February 2020 revenue growth inflation
Retail 10 410 9 435 10.3 5.1 3.6
Wholesale 8 559 7 132 20.0
Intergroup (7 368) (6 220) 18.5
Total Group 11 602 10 347 12.1
The financial information in this trading update has not been reviewed or reported on by the
Group's independent auditor Ernst and Young.
Dis-Chem's results for the year ended 28 February 2021 will be released on SENS on Friday, 21 May
2021, at around 7:05 am.
For further information, contact the Group's Investor Relations at investorrelations@dischem.co.za.
Midrand
17 February 2021
Sponsor
The Standard Bank of South Africa Limited
Date: 17-02-2021 08:00:00
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