Clicks reports 11.9% jump in HEPS

South Africa's largest pharmacy group, Clicks, has reported an 11.9% jump in headline earnings per share for the year ending August, despite facing ongoing challenges in trading due to the impact of the 2021 July unrest and worsening power cuts. The company's CEO, Bettina Engelbracht, discussed the impressive financial results in an interview with CNBC Africa, highlighting the resilience and focus of Clicks in delivering value to its shareholders. The market responded positively to the news, with Clicks' share price rising more than 7%. Engelbracht attributed the market's favorable reaction to Clicks' ability to weather difficult conditions and optimize performance. One of the key factors driving Clicks' positive financial performance was the recovery of the beauty category following the lifting of COVID-19 restrictions. Engelbracht emphasized the importance of this recovery, as it indicated sustained customer loyalty and potential for further growth. Additionally, the company benefited from the first cold and flu season since 2019, boosting performance in the second half of the year. Clicks also saw strong performance in general merchandise, particularly in heritage categories, where it gained 140 basis points. These factors contributed to a significant increase in diluted headline earnings special, up 33.5% year-on-year. Looking ahead, Engelbracht acknowledged the challenging economic environment but expressed confidence in Clicks' ability to respond effectively. As a value retailer with a strong private label offering, Clicks is well-positioned to meet consumer needs and preferences, including the demand for affordable options. The company's convenient store locations further enhance its competitive advantage, with 75% of stores located in easily accessible areas. Clicks plans to invest a record amount of 936 million in capital expenditure, focusing on opening new stores, refurbishing existing stores, and modernizing the shopping experience for customers. The expansion plans include opening 40 to 50 new stores and stock pharmacies, with a target of reaching 1,200 stores. The emphasis on convenience locations reflects Clicks' commitment to meeting customer needs and fostering growth. The company's investment in store modernization and expansion also aligns with its strategy to consolidate market share and capitalize on opportunities for organic growth within the retail pharmacy market. The creation of new jobs through store openings is not only a business benefit but also a social contribution that Clicks values and celebrates. In summary, Clicks' robust financial performance, strategic investments, and commitment to customer-centric growth underscore its position as a leader in the pharmacy retail sector. Despite ongoing challenges, the company's resilience and focus on delivering value to shareholders have been key drivers of its success. With a clear vision for the future and a proactive approach to expansion and innovation, Clicks is poised to continue its growth trajectory and reinforce its market presence in South Africa's competitive retail landscape.