Dis-Chem I believe the children are our future
Those Dis-Chem results then, where for the 12 months through 29 February revenue grew +12% to R24bn, be it mainly from new stores and acquisitions. Group earnings took somewhat of a knock mainly due to the stock rationalisation process, which saw a drop in purchases from suppliers and hence the retailer’s corresponding rebates, and after adding the effect of once-off costs to it all, margin for the year was in the red, which, of course, is not all that. The Group has its sights firmly on FY2021, however, when it hopes to continue growing ahead of the market, and then there’s this (subject to approval from the relevant authorities): the Group has agreed to purchase 100% of the issued share capital of Baby City for a princely – indeed, a princessly – R430m, in the midst of an outbreak nogal, indicating a heartening belief in the future, of their business and otherwise. The move makes sense: culturally and operationally the businesses are aligned, and South Africans insist on adding around 900,000 babies to the population every year, so a shortage of punters is not going to be the issue. For our usual snappy synopsis of the results, click here .
Comment: Nice one Dis-Chem, giving them a bit of competitive space in which to roam outside of the increasingly crowded pharmacy sector in which they currently operate.