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Dis-Chem Pharmacies Posts Impressive 11.1% Revenue Growth in FY24 | Rateweb
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Dis-Chem Pharmacies Posts Impressive 11.1% Revenue Growth in FY24

Dis-Chem Pharmacies Limited has released its audited annual consolidated results for the fiscal year ending on February 29, 2024. Despite facing a challenging economic environment, the Group has demonstrated resilience and strategic agility. The financial performance for FY24 underscores the company’s ability to adapt and thrive, making significant strides in revenue growth and operational efficiency.

Revenue Growth and Operational Highlights

Group Revenue

Dis-Chem reported a substantial increase in group revenue, reaching R36.3 billion, marking an 11.1% year-on-year growth from R32.7 billion in FY23. This impressive revenue surge highlights the Group’s robust market presence and strategic initiatives aimed at enhancing its market share.

Retail Revenue

Retail revenue experienced a notable increase of 9.7%, rising to R31.7 billion. Comparable pharmacy store revenue grew by 6.9%. The impact of COVID-19 vaccine administration and testing services, which were significant in the prior period, diminished in the current year. Excluding these contributions, retail revenue saw an adjusted growth of 10.3%. During FY24, Dis-Chem expanded its retail footprint by opening or acquiring 15 new pharmacy stores, bringing the total to 273 retail pharmacy stores and 54 retail baby stores.

Wholesale Revenue

Wholesale revenue showcased a strong growth trajectory, increasing by 13.3% to R27.4 billion. Revenue from wholesale operations to Dis-Chem’s own retail stores grew by 11.8%, while external revenue to independent pharmacies and The Local Choice (TLC) franchises surged by 21.4%. The independent pharmacy segment grew by 23.2%, driven by new customer acquisitions and increased support from existing clients. The TLC franchise network expanded from 171 to 205 stores, contributing to a growth rate of 19.6%.

Financial Performance Analysis

Earnings and Dividends

The Group’s basic earnings per share (EPS) and headline earnings per share (HEPS) were 114.7 cents and 114.6 cents respectively, representing decreases of 1.4% and 1.6% compared to FY23. Adjusting for a one-off property gain in the prior year, EPS and HEPS would have increased by 4.0% and 3.8% respectively.

Dis-Chem declared a final dividend of 22.49 cents per share, reflecting a significant 21.9% increase from the previous year. The total dividend for the year stood at 45.74 cents per share, a slight decrease of 1.8% from FY23. The dividend declaration aligns with the Group’s policy of distributing 40% of headline earnings.

Table: Key Financial Metrics

MetricFY24FY23% Change
Group RevenueR36.3 billionR32.7 billion11.1%
EPS114.7 cents116.3 cents-1.4%
HEPS114.6 cents116.5 cents-1.6%
Final Dividend per Share22.49 cents18.45 cents21.9%
Total Dividend per Share45.74 cents46.57 cents-1.8%

Operational Efficiency and Cost Management

Dis-Chem demonstrated significant progress in managing operational costs, particularly in controlling staff expenses, which constitute the largest cost line for the Group. Employment costs increased by 8.0% for the full year, with a notable reduction in the second half, reflecting effective cost control measures.

Cost Containment Efforts

Retail expenses grew by 11.0%, driven by investments in new stores, higher diesel costs for generators during load-shedding, and increased IT costs. Wholesale expenses increased by 8.0% due to higher volumes, increased casual labor, and higher diesel, advertising, and municipal costs.

Net Finance Costs and Working Capital

Net finance costs increased by 25.6% from the prior year, primarily due to higher interest rates and additional term loans for warehouse acquisitions. The Group’s net working capital saw an increase, with inventory levels rising by R806 million or 12.7%. Inventory days slightly decreased from 88.2 to 88.1 days, while debtor and creditor days saw minimal changes.

Strategic Investments and Capital Expenditure

Dis-Chem invested R1.0 billion in capital expenditure, focusing on expansion, IT enhancements, and a new distribution center in Gauteng. The acquisition of a 63,000m² distribution center in Gauteng for R502 million received Competition Commission approval in October 2023. This investment aligns with the Group’s strategy to expand its warehouse capacity to meet increasing demand.

Leadership Transition

On July 1, 2023, Rui Morais succeeded Ivan Saltzman as CEO, with Saltzman remaining as an executive director. Julia Pope, the Group’s executive head of finance, assumed the role of CFO.

Outlook and Future Strategic Initiatives

Future Growth Prospects

For the three-month period from March 1 to May 25, 2024, Dis-Chem reported an 11.4% increase in group revenue. Despite an economically constrained consumer environment, the Group remains optimistic about its future growth prospects.

Strategic Focus Areas

Dis-Chem has identified eight strategic areas to drive long-term shareholder returns:

  1. Property Expansion: Adding approximately 137,000m² of retail space over 36 months.
  2. Wholesale Market Share Expansion: Supporting internal retail growth and expanding independent pharmacy market share.
  3. Income Maintenance: Ensuring incremental improvements in total income.
  4. Cost Control: Sustaining positive operating leverage through efficient staffing and cost management.
  5. Working Capital Optimization: Aiming for a 10% improvement in inventory days.
  6. Integrated Health Ecosystem: Enhancing healthcare access through synergistic integration with pharmacy and clinic operations.
  7. Leveraging Analytics: Investing in core analytics capabilities to drive strategic initiatives.
  8. Digital Dominance: Establishing a strong presence in the online health space.


Dis-Chem Pharmacies Limited has showcased a robust financial performance for FY24, reflecting its strategic agility and market resilience. With substantial revenue growth and a focused approach to cost management, the Group is well-positioned for future success. The strategic investments in property expansion, digital initiatives, and an integrated health ecosystem will drive long-term growth and shareholder value. The leadership transition and identified strategic focus areas will further enhance Dis-Chem’s ability to navigate the evolving market landscape and deliver sustainable financial performance.