Dis-Chem resumes interim dividend

After withholding its 2020 half-year dividend in the wake of Covid-19 and due to acquisitions like that of Baby City.
A worker dispenses hand sanitiser at the entrance of a Dis-Chem Pharmacies store in Pretoria. Image: Waldo Swiegers/Bloomberg

Burgeoning pharmacy retail and healthcare group Dis-Chem has resumed paying an interim dividend and declared a payout of 19.5 cents per share on Wednesday for its half-year ended August 31, 2021.

It comes as the group reported strong double-digit growth in revenue of 16.6% for the period, to R14.9 billion. This resulted in its headline earnings per share (Heps) surging 35.3% from 36 cents at HY2020 to 48.7 cents for its latest half-year.

Dis-Chem’s return to paying out an interim dividend follows the group opting to withhold dividends for its corresponding half year in 2020 in the wake of the Covid-19 pandemic and due to the group prioritising acquisitions, such as that of baby-focused retail chain Baby City.

Read:

Dis-Chem defers dividend to buy Baby City

Clicks continues expansion, plans to open 11 baby ‘showroom’ stores

“Despite a tough economic environment with the Covid-19 pandemic and the deepening economic recession, the group has achieved positive results, continued to take market share in all categories and delivered strong cash generation,” Dis-Chem notes in its latest interim results Sens statement.

“Earnings attributable to shareholders and headline earnings increased by 34.6% and 35.3% respectively over the previous corresponding period. Earnings per share and Heps are 48.4 cents and 48.7 cents per share respectively, an increase of 34.4% and 35.3% respectively,” pointed out.

Dis-Chem said retail revenue grew by 16% to R13.2 billion. However, comparable store revenue grew at 6.8%.

“During the twelve months to August 31, 2021, 18 Dis-Chem and three Baby City stores were opened resulting in 199 Dis-Chem and 35 Baby City stores as at August 2021.”

“These stores together with the Baby City stores acquired on January 1, 2021 contributed R822 million to revenue. The group opened its landmark 200th Dis-Chem store in October,” it added.

July unrest

Regarding the civil unrest and looting in KwaZulu-Natal and Gauteng in July, the group said that while it was affected, all its stores are now fully operational.

“Our committed management and staff worked tirelessly, ensuring that three stores returned to regular trading within a month, while the final Dis-Chem store reopened on October 7,” it noted.

The group said that it is adequately insured to cover the losses incurred.

Meanwhile, Dis-Chem said that it “continues to support the national response to the Covid-19 pandemic by operating a national vaccination site network, comprising mass and in-store clinic sites”.

“During the period under review, Dis-Chem administered 405 000 vaccine doses, with that number increasing to 860 000 by the end of October.”

Dis-Chem’s share price closed more than 5% up on Wednesday, at R33.14, following the release of its half-year results.

Listen to Simon Brown’s MoneywebNOW interview with Mia Kruger on Dis-Chem and Clicks (or read the transcript):

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