Clicks retail sales rise as it grows market share

PHARMACY, health and beauty retailer Clicks said yesterday that its interim retail sales increased 13.6 percent, bolstered by market share gain and a robust expansion of its stores and pharmacy network.

The company said its clubcard membership grew and accounted for 81 percent of the group’s sales in the six months.

In an interview, Clicks chief executive Bertina Engelbrecht said: “We have an iconic clubcard loyalty programme. This is appreciated by the customer and we continue to grow that programme. We have now grown to 9.5 million active shoppers on that programme.”

In its results for the six months ended February 28, 2022 the company said its half-year earnings jumped by 26 percent, while its group turnover increased by 9 percent to R19.6 billion. Headline earnings from continuing operations grew by 18.3 percent to R1.1bn.

Shareholders were given an increased interim dividend, which rose by more than 26 percent to 180 cents per share in line with the earnings growth. 

Despite paying out R1.3 billion in dividends, and buying back shares, the company still had an R838 million cash pile.

“We are pleased with the results. We have built the organisation’s capability in our people to continue delivering great results. It’s not dependent on one or two people. It’s a proxy organisation,” she said.

Engelbrecht said the company has a resilient business model, which had helped the company to thrive even in a difficult trading environment.

“No matter what was thrown at the group, we continued to thrive and deliver results which are normally better than what was expected. The categories that we trade are very defensive. Now we see the recovery in some of our categories, in beauty. Our convenient location is also supported by the online store,” she said.

This as the retailer is ramping up its footprint.

Engelbrecht said Clicks opened its 800th store in March, and its pharmacy footprint grew by 45 new outlets, to bring it to a total of 646.

She said since the economy was recovering, Clicks was continuing to invest in new store openings and planned to open 28 more stores this year.

“Soon we will be opening up about three more stores. One in George, another in Claremont, and Roodepoort in Gauteng,” she said, adding that new store openings would bring in more sales. 

“Because of the categories we are operating in we can see that it is going to be great. If you look at what we have been able to overcome in the past, what we are facing in the remainder of this financial year, it isn’t anything we haven’t overcome before,” she said.

Looking ahead, Engelbrecht said the retail environment would remain constrained due to the increasing pressures on consumer disposable income and the expected trading disruption from ongoing electricity load shedding.

In July last year, Clicks was one of the many businesses that were impacted by the unrest which took place in KwaZulu-Natal.

Clicks said its South African Special Risks Insurance Association settlement for damages from the civil unrest totalled R710m, with the second interim payment of R217m received in the current reporting period.

“The final payment of R276m was received after the end of the reporting period. Adjusting for the impact of the second Sasria insurance payment, headline earnings from continuing operations grew by 8.6 percent,” the company said.

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