Press Releases

Trading update for the four months ended December 2008

Release Date: 2009/02/03

HIGHLIGHTS

•        Clicks turnover up 13.1%
•        Retail sales up 11.1%

RETAIL TRADING

Retail sales increased by 11.1% for the four months ended December 2008, with a particularly pleasing trading performance from the flagship business, Clicks, which lifted turnover by 13.1% and by 11.2% on a same store basis.

The strong value offer in Clicks continues to appeal to consumers who are under financial pressure. The smaller gifting ranges across the confectionery, toiletry and beauty categories were well suited to the needs of consumers at this time and resulted in robust festive season trading. Health (including dispensary) and beauty merchandise continue to be the major drivers of sales growth. Clicks posted real sales growth of 7.4% after recording inflation of 5.7%.

The slowdown in consumer spending was evident in Musica which offers more discretionary merchandise. Musica’s performance was impacted by slower sales of DVDs and gaming software, although the business continued to record market share gains during the period.

The Body Shop performed reasonably well in the current environment, with sales of smaller gifting ranges again proving popular.

Consumers were more discerning and conscious of how they spent their money over this Christmas period. In seeking out value for money, shoppers focused on smaller, more practical gifts. They left their shopping late and also appear to have deferred purchases to the post Christmas period and into early January.

UPD

The strategy adopted by UPD in the previous financial year to focus on its more profitable and loyal customers has resulted in sales growth slowing to 3.7% for the four month period, in line with expectations. This focus on more profitable customers will enable UPD to drive further efficiencies from the business.

GROUP SALES

Total sales for the group increased by 6.1% to R4.1 billion, with inflation for the 17 week period measuring 3.9%.

   Four months to Dec 2008 (Rm)        Four months to December 2007 (Rm)  Total sales growth (%) Same store sales growth (%)  Inflation (%) 
 Clicks  2431  2149  13.1  11.2  5.7
 Musica  398  397  0.3  0.1  5.0
 The Body Shop  42  38  8.7  1.2  10.5
 Total retail  2871  2584  11.1  9.4  5.7
 UPD        1616  1558  3.7    0.8
 Less intragroup turnover  (362)  (255)  41.7    
 Total group  4125  3887  6.1  3.9

Retail trading conditions are expected to remain challenging in 2009 with continued pressure on consumer expenditure, despite relief from the declining fuel price and further expected cuts in interest rates. The group is, however, confident of achieving the strategic objectives and financial targets set out in the 2008 annual report.

The information contained in this trading update has not been reviewed or reported on by the group’s auditors. New Clicks’ interim results for the six months to 28 February 2009 will be released on SENS on or about 30 April 2009.

Ends
Issued by Tier 1 Investor Relations on behalf of the Clicks Group
For further information kindly contact
Graeme Lillie, Tier 1 Investor Relations 021 702 3102 / 082 468 1507