Cape Town – Clicks Group increased trading profit by 15.1% to R4.2 billion for the year to August 2024 as the group expanded margins, generated strong cash flows and delivered industry-leading shareholder returns.

Retail turnover grew by 11.7% with group turnover up 9.2% to R45.4 billion. The group’s trading margin expanded by 50 basis points to 9.2%.

Headline earnings grew by 11.9% to R2.8 billion with diluted headline earnings per share increasing 14.3%. The total dividend was increased by 14.3% to 776 cents per share. The group returned R2.5 billion to shareholders in dividend payments and share buybacks in the year.

The group’s market capitalisation on the JSE increased by 34.9% to R89 billion at year end while the return on equity improved from 43.6% to 46.4%. Cash generated by operations totalled R6.0 billion and the group held cash of R2.7 billion at year end.

Chief executive Bertina Engelbrecht said the group’s performance over the past year highlighted the resilience of its business model and the defensiveness of its core product offering.

Clicks recorded market share gains across all its core health and beauty product categories. Retail pharmacy market share increased from 23.7% to 24.2% and front shop health market share grew from 33.1% to 34.2%. In beauty and personal care, the skincare market share increased from 42.7% to 43.8%. Sales of private label products grew by 13.5% and now account for 30% of front shop sales in Clicks.

The iconic Clicks ClubCard loyalty programme grew membership by 1.4 million to 11.8 million, contributing 82% of sales in Clicks. ClubCard customers received R780 million in cashback rewards during the year.

Clicks increased its store base to 936 with the opening of a net 51 stores and the pharmacy network to 720 following the opening of a net 9 new pharmacies. Clicks plans to open 40 to 50 new stores and pharmacies for the 2025 financial year, with the medium-term target of expanding to 1 200 stores.

The group’s pharmaceutical distributor UPD grew turnover by 3.3% and is well positioned to regain wholesale market share following the improved performance in the second half and the momentum being carried into the 2025 financial year.

On the prospects for the new financial year, Engelbrecht said the medium-term outlook for the consumer environment is increasingly positive, although spending is expected to remain muted in the short-term.

“Several factors are supporting improved consumer sentiment which should ultimately translate into increased spending. These include lower inflation, interest rate relief, declining fuel costs, the strengthening currency and the extended absence of load shedding.”

“We are confident that our competitive advantage and market-leading positions in the health and beauty sectors, together with the long-term organic growth opportunities in Clicks, should ensure we continue to deliver on our medium-term growth targets,” she said.