Dis-Chem sees 15% revenue growth as consumers return to malls

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Dis-Chem CEO Ivan Saltzman
Dis-Chem CEO Ivan Saltzman
Deon Raath

Pharmacy retailer Dis-Chem has seen a 15.3% jump in revenue growth over 21 weeks, as consumer patterns shift with people returning to shopping malls.

In a statement on Monday, Dis-Chem said its revenue for the 21 weeks from 1 September 2021 to 26 January 2022, grew to R12.7 billion compared to the previous reporting period.

"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," said CEO Ivan Saltzman. 

The group’s retail segment’s revenue grew to R11.4 billion, an increase of 15.5%.

Dis-Chem explained that sales for preventative healthcare products such as vitamins and nutraceuticals were muted in December and January, due to the Omicron Covid-19 variant being less severe. However, the pharmacy retailers said sales were normalising. 

The group administered 895 000 vaccines during the 21 weeks, which contributed R341 million revenue to the segment, with about half of the revenue coming from standalone sites.

But vaccination demand has been low since the beginning of December - a trend Dis-Chem expects to will continue.

The group also grew its footprint in the 21-week period, with seven new stores, that added R75 million to its retail revenue.

It also finalised its Medicare group acquisition in October, which added 49 stores to its portfolio. The acquisition - together with the 35 Baby City stores and 206 Dis-Chem outlets - brings the group’s store base to 290.

"Consistent with our strategy of having at least one primary healthcare clinic in every Dis-Chem store, we are on track for every Baby City store to have an operational Moms and Baby focused clinic by April 2022," said Dis-Chem.

With regards to wholesale, Dis-Chem said its revenue grew by 10.6% to R9.1 billion.

The pharmacy retailer is due to release its results for the year ended 28 February 2022, in May.

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