PHARMACEUTICAL chain store Dis-Chem yesterday posted double-digit revenue growth for the 21-week period from September 1, 2021, to January 26, 2022, as shoppers returned to malls and as it continued to gain market share from its competitors.
Revenue was 15.3 percent higher at R12.7 billion in the reported period, while retail revenue increased by 15.5 percent to R11.4bn compared to the same period last year. Like-for-like revenue growth was 5.5 percent. It also added seven new Dis-Chem stores in the reporting period, which contributed R75m to retail revenue.
Dis-Chem chief executive Ivan Saltzman said yesterday: “We continue to trade well, with market share gains across all core categories, supported by further normalisation in gross margins. This is being driven by a shift in consumer dynamics and a sustained return to regional shopping malls, where many mature Dis-Chem stores are located.“
Dis-Chem was dented by the Covid-19 pandemic, especially at the height of it. The less severe Omicron-variant fourth wave, and relative to the base which resulted during the more serious second-wave, sales growth of preventative healthcare products, including vitamins and nutraceuticals were muted during December and January.
“There are early signs of normalised sales returning to this category where we continue to maintain our market-leading position. The group continues to gain market share across all core categories, with notable gains in Pharmacy, Personal Care, Baby and Beauty categories," it said.
Dis-Chem said during the 21-week period, it also administered 895 000 Covid-19 vaccine doses, contributing R341m to retail revenue, with 50 percent of this contribution coming from standalone mass sites. Excluding vaccine contribution, retail revenue increased by 12 percent.
Due to the Covid-19 pandemic and shoppers opting to shop online, DisChem's online sales grew.
“Online sales grew by 14.3 percent, with notable, disproportionate growth in our on-demand DeliverD service, highlighting the convenience,” it said.
In its wholesale section revenue increased by 10.6 percent to R9.1bn for the 21 weeks over the corresponding period, with sales in its retail stores
increasing by 10.1 percent, lower than its retail revenue growth resulting in a continued improvement in group inventory management.
The company said the support from its franchise, The Local Choice (TLC), continued to be strong.
“We now have 138 TLC franchise stores, up from 117 at the end of the corresponding period. TLC growth increased by 26.2 percent ahead of franchise store growth at 17.9 percent highlighting the benefits of the TLC franchise offering,” Dis-Chem said.
In October 2021, the group acquired the Medicare group, adding 49 stores to Dis-Chem's store portfolio.
“The group now has a store base of 290 stores, comprising 206 Dis-Chem, 49 Medicare, and 35 Baby City stores. We are on track for every Baby City store to have an operational Moms and Baby focused clinic by April 2022," the group said.
By 5pm the share was 4.13 percent lower at R36.19 on the JSE.
BUSINESS REPORT ONLINE