Dis-Chem Pharmacies (DCP) H1 2025 earnings summary

Executive summary

• Group revenue increased by 11.1% to ZAR 36.3 billion, with a strong second half driving profit before tax growth of 22% compared to the same period last year.

• Revenue grew 9.6% year-over-year to R19.6 billion for the six months ended 31 August 2024, with operating profit up 17.5% and EPS increasing 15.6% to 67.4 cents.

• Earnings per share, excluding a prior year property gain, rose just over 4%, and full-year dividends increased by 21% in the second half.

• Market share in dispensary extended, maintaining leadership as South Africa's largest pharmacy retailer.

• Digital health and integrated health ecosystem initiatives showed strong policyholder engagement and retention.

Financial highlights

• Retail revenue grew by 9.7% to ZAR 31.7 billion, with like-for-like sales up 6.9%.

• Wholesale revenue increased 10.1% to R15.1 billion, with external revenue to independent pharmacies and TLC franchises up 26.6%.

• Operating profit, excluding the property gain, increased by 6.4%; operating margin declined from 5.1% to 4.9%.

• EPS and HEPS, adjusted for the property gain, increased by 4% and 3.8% respectively.

• Cash increased by ZAR 194 million, with expansion CapEx to turnover at 0.9%.

Outlook and guidance

• Tough trading conditions expected to persist; focus remains on value, cost containment, and accelerated property rollout.

• Over 22 new sites secured for FY 2025, with further acceleration planned for FY 2026 and 2027.

• Continued investment in digital, analytics, and integrated healthcare, including new life insurance offerings.

• Launch of Dis-Chem Life in Q1 2025 and evolution of extra Rewards to drive engagement.

• Targeting 10% improvement in inventory days over 18 months and continued wholesale market share expansion.