The financial resources received from providers of capital and deployed by the group
- Equity of R5.7 billion
- Cash resources R2.0 billion
- Borrowing facilities R3.4 billion
- Working capital outflow of R745 million
Shareholders
Regulators
The infrastructure used in the selling and distribution of merchandise, including stores, pharmacies, distribution centres, the group’s head office and online store
- 898 stores trading in five countries
- E-commerce capability
- 673 pharmacies
- 199 clinics
- 8 distribution centres located in five major provinces
Customers
Suppliers
Employees
The competency, capability and experience of the board, management and employees
- 16 492 permanent employees
- 95% black and 63% female employees
- Extensive investment in training and development
- Company-funded healthcare cover available to all employees
Employees
Regulators
The collective knowledge and expertise across the business as well as the intellectual property of the group which provide a competitive advantage
- Brand equity is well established with market leading brands Clicks, The Body Shop and UPD
- Extensive range of private label products
- Clicks ClubCard is one of South Africa’s largest loyalty programmes, introduced in 1995
Employees
Relationships with stakeholders influencing the business, primarily customers, employees, suppliers, shareholders and regulators
- 9.7 million Clicks ClubCard loyalty members
- New Clicks Foundation funds of R136 million
- Community support through social investment programme and Helping Hands Trust
- Listing portal for small and medium-sized suppliers
- Small enterprise owner driver scheme contracted to UPD
Shareholders
Customers
Employees
Suppliers
Regulators
Environmental resources applied and utilised in the business. The group’s operations have a low environmental impact and therefore use limited natural capital
- Sustainable materials used in products and packaging
- Group-wide recycling programme
- R57 million invested in renewable energy in 2022
Customers
Employees
Regulators
Customer care
Customer care from engaging and knowledgeable staff in the front shop and pharmacy. Convenience An extensive store footprint and pharmacy network in convenient locations allows for easy access to customers, supported by an online store and national pharmacy delivery service.
Value
Consistently good value-for-money products delivered through competitive prices and effective promotions.
Convenience
An extensive store footprint and pharmacy network in convenient locations allows for easy access to customers, supported by an online store and national pharmacy delivery service
Differentiation
The product offering is differentiated through a wide range of private label and exclusive brands. Private label scheduled medicine ranges offer customers choice for quality generic medicine at a lower price.
Rewards
ClubCard enables Clicks to personalise engagement and communication with customers, supporting the aim of the loyalty programme to increase basket size and value, and frequency of shopping
- Group diluted HEPS up 33.5%
- Diluted HEPS adjusted for impact of civil unrest up 11.9%
- Dividend of 637 cents per share
- Return on equity 48.0%
- Cash generated by operations R4.3 billion
- R1.7 billion returned to shareholders in dividends and share buy-backs
- Reinvested R838 million in capital expenditure
- Opened 58 Clicks stores
- Opened 52 pharmacies
- 50% of customers live within 5.3 km of a Clicks pharmacy
- 2.9 million Covid-19 vaccinations administered
- 1.7 million social media followers
- R4.0 billion paid to employees
- 3 746 employees trained
- R165 million invested in employee training and development
- Retail pharmacy market share 23.7%
- Private pharmaceutical wholesale market share 28.8%
- Constituent of FTSE/JSE Top 40 Index
- Clicks private label sales account for 24.2% of total sales
- Additional 500 000 Clicks ClubCard members
- R601 million in cashback paid to ClubCard members
- R938 million paid in taxes in all countries of operation
- R33 billion paid to suppliers of goods and services, including landlords
- R67 million invested in enterprise and supplier development programmes
- R42 million paid to 65 small enterprise owner drivers contracted to UPD
- R24 million invested in socioeconomic development programmes
- 88 bursaries awarded primarily to pharmacy students
- Level 4 BBBEE rating • Constituent of FTSE4Good Index
- Total carbon emissions 149 520 tonnes CO2
- Waste recovered for recycling 4.4 million kg
- Produced 631MWh renewable energy
Material trade-offs of capitals
In delivering on the group’s strategic objectives, management aims to balance and optimise the trade-offs between capitals to ensure long-term growth and sustainability.
While the commitment to investing in manufactured, intellectual, human and social and relationship capital erode financial capital in the short term, the long-term benefits are reflected in the group’s industry-leading financial and operating metrics and sustained shareholder value creation.
Limiting the environmental impact of the operations to reduce the rate at which natural capital is depleted has a significant impact on financial impact in the short to medium term but should deliver the desired long-term benefits as the group ultimately moves towards carbon neutrality.
Constraints on capitals
The key constraints encountered during the year were in relation to manufactured capital. The global supply chain disruption which started during the Covid-19 pandemic continued and was compounded by the impact of the war in the Ukraine in the second half of the financial year. This has resulted in significantly increased transport costs due to rising fuel prices while seasonal merchandise has been secured and imported several months earlier than required to mitigate delays in shipping, which has negatively impacted working capital.
Loadshedding due to electricity supply constraints has had a significant impact on turnover owing to shorter trading hours in shopping centres and disruption of shopping patterns. The group has invested more than R57 million in alternative power solutions to limit the impact of electricity outages.
The weak economic environment and rising fuel, energy, food and borrowing costs has constrained consumer disposable income which has negatively affected discretionary retail spending. The ongoing impact of Covid-19 and the aftermath of the civil unrest in KwaZulu-Natal in 2021 were further constraints to trading.
The group previously encountered a constraint in securing new trading space in existing shopping centres. However, owing to the economic impact of Covid-19 and resultant closure of many retail outlets, the group has been able to accelerate its store opening programme, with 92 stores opened in the past two pandemic-impacted financial years.
The group has no financial capital constraints owing to the strong cash flows generated by the operations and access to borrowings. Should these financial resources prove insufficient, the group’s strong balance sheet will enable management to access further loan funding or raise capital through the issue of shares.