Slide 1: Interim Results for the Six Months Ended 28 February 2022
INTERIM RESULTS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2022
Slide 2: Presentation Outline
PRESENTATION OUTLINE ▪ Review of the period ▪ Financial results ▪ Trading performance ▪ Outlook ▪ Questions CLICKS GROUP INTERIM RESULTS 2022 2
Slide 3: Review of the Period
REVIEW OF THE PERIOD BERTINA ENGELBRECHT CLICKS GROUP INTERIM RESULTS 2022 3
Slide 4: Review of the Six Months
REVIEW OF THE SIX MONTHS ▪ Performance highlights the resilience and defensiveness of the group in a very tough economic environment ▪ Retail trading still impacted by Covid-19 and civil unrest ▪ Muted growth in UPD, impacted by less severe Omicron wave ▪ Clicks is the largest vaccinator in SA, havi
Slide 5: Financial Results
FINANCIAL RESULTS MICHAEL FLEMING CLICKS GROUP INTERIM RESULTS 2022 5
Slide 6: Financial Highlights
FINANCIAL HIGHLIGHTS ▪ Turnover up 9.0%* ▪ Retail turnover up 13.6%*, with 6.5% growth from vaccines ▪ UPD reported turnover up only 0.6% ▪ Operating margin down from 8.0% to 7.8%** ▪ Group diluted HEPS up 26.0% to 466.9 cps ▪ Continuing adjusted dHEPS up 10.2%** ▪ Return on equity up from 37.4% to
Slide 7: Impact of Insurance Payment
IMPACT OF INSURANCE PAYMENT Continuing operations Reported Adjusted R′m Adjustment H1 2022 H1 2022 Turnover 19 558 19 558 Gross profit 4 133 4 133 Other income 1 337 (130) Second SASRIA insurance payment 1 207 Expenses (3 805) (3 805) Operating profit 1 665 (130) 1 535 Capital items 87 (87) PPE insu
Slide 8: Turnover
TURNOVER % same R′m % % Feb 2022 Feb 2021 change stores inflation growth Retail 14 574 12 832 13.6 10.2 3.7 Distribution 8 189 8 141 0.6 1.9 Intragroup turnover (3 205) (3 027) 5.9 Total group 19 558 17 946 9.0 3.1 ▪ Administered 2.2m vaccines in the period with turnover of R832m, an uplift of 6.5%
Slide 9: Total Income
TOTAL INCOME Feb 2022 Feb 2021 % Feb 2022 Feb 2021 R′m R′m change % margin % margin Retail 4 759 4 242 12.2 32.7 33.1 Distribution 714 689 3.6 8.7 8.5 Intragroup (133) (101) 31.8 Total group 5 340 4 830 10.6 27.3 26.9 ▪ Retail impacted by lower margin vaccinations offsetting recovery of higher margi
Slide 10: Operating Expenditure - Retail
OPERATING EXPENDITURE - RETAIL R′m Feb 2022 Feb 2021 % change Depreciation – PP&E 220 195 12.9 Depreciation – ROU asset 409 351 16.3 Occupancy costs 78 80 (2.3) Employment costs 1 841 1 647 11.8 Other operating costs 892 792 12.7 Total retail costs 3 440 3 065 12.2 % of turnover 23.6% 23.9% Finance
Slide 11: Operating Expenditure - Distribution
OPERATING EXPENDITURE - DISTRIBUTION R′m Feb 2022 Feb 2021 % change Depreciation – PP&E 14 16 (13.0) Depreciation – ROU asset 6 2 Occupancy costs 3 1 Employment costs 156 145 7.8 Other operating costs 289 268 8.2 Total distribution costs 468 432 8.4 ▪ Impact of costs related to new bulk distribution
Slide 12: Operating Profit
OPERATING PROFIT Feb 2022 Feb 2021 % Feb 2022 Feb 2021 R′m R′m change % margin % margin Retail 1 319 1 177 12.0 9.1 9.2 Distribution 246 257 (4.4) 3.0 3.2 Intragroup (30) (6) Total group 1 535 1 428 7.5 7.8 8.0 ▪ Impact of very low margin of vaccinations in Retail ▪ Impact of lower wholesale turnove
Slide 13: Inventory
INVENTORY Days in stock Inventory (R′m) Feb 2022 Feb 2021 Feb 2022 Feb 2021 % change Retail 81 85 4 357 4 017 8.5 Distribution 49 56 2 198 2 460 (10.6) Intragroup inventory (151) (94) Total group 78 83 6 404 6 383 0.3 ▪ Inventory levels well managed Note: Continuing operations CLICKS GROUP INTERIM R
Slide 14: Cash Management for the Six Months
CASH MANAGEMENT FOR THE SIX MONTHS * Impacted by civil unrest (receipt of SASRIA insurance payments, inventory replacement and new PPE required) CLICKS GROUP INTERIM RESULTS 2022 14
Slide 15: Capital Expenditure
CAPITAL EXPENDITURE ▪ R876m capex planned for FY2022, including R167m for replacement of assets damaged in the civil unrest and R46m carried forward from FY2021 ▪ R565m on stores, including: - 45 new Clicks stores and 54 new pharmacies - 35 store refurbishments and restoring 53 damaged stores ▪ R311
Slide 16: Trading Performance
TRADING PERFORMANCE BERTINA ENGELBRECHT CLICKS GROUP INTERIM RESULTS 2022 16
Slide 17: Retail Sales Performance
RETAIL SALES PERFORMANCE % change % contribution Pharmacy 7.7 26.1 Vaccinations 5.7 Front shop health 3.6 25.1 Beauty and personal care 10.1 28.7 General merchandise 6.4 14.4 Total turnover 13.6 100.0 ▪ Comparable stores turnover growth of 10.2% ▪ Inflation 3.7% ▪ Volume growth of 6.5% attributable
Slide 18: Market Share Gains
MARKET SHARE GAINS % Feb 2022 Feb 2021 Health Retail pharmacy* 23.8 23.4 Front shop health** 32.4 32.6 Baby** 19.4 19.5 Beauty Skincare** 41.2 40.2 Haircare** 31.2 31.1 Personal care** 19.5 18.4 General merchandise Small electrical appliances*** 18.1 17.8 * Per IQVIA (Private Retail Pharmacy S1-6) *
Slide 19: Performance and Strategy
PERFORMANCE AND STRATEGY ▪ Maintaining value Clicks price index* vs: ▪ More price competitive than Retailer A 93.0% all national retailers Retailer B 92.1% ▪ Promotional sales +8.3% Retailer C 92.2% to 42.7% of turnover (excl vaccines) Retailer D 97.5% * Excluding 3 for 2 promotions ▪ Differentiatin
Slide 20: Performance and Strategy
PERFORMANCE AND STRATEGY ▪ Engaging customers through personalisation ▪ 9.5m active ClubCard members, 80.5% of sales (excl vaccines) ▪ Clicks app downloaded by 2.7m customers ▪ Enabling efficient healthcare access ▪ Repeat prescription service ▪ Clicks Doctor telemedicine service in 133 clinics ▪ Im
Slide 21: Performance and Strategy
PERFORMANCE AND STRATEGY ▪ Extending convenience Format Total* ▪ 796 Clicks stores with 646 pharmacies* Convenience 593 ▪ 50% of population < 5.5km of a pharmacy Destination 203 ▪ Received approval for transfer of 11 of Total 796 25 Pick n Pay pharmacies in H1 ▪ 64 SA stores still to get a dispensar
Slide 22: UPD - We Deliver Healthcare
¢UPD WE DELIVER HEALTHCARE
Slide 23: Fine Wholesale Turnover
FINE WHOLESALE TURNOVER Independent pharmacies & other channels (-28.2%) 11.5% Private 38.3% 50.2% Clicks hospitals (+4.7%) (-3.7%) ▪ Wholesale turnover down 3.6% ▪ Hospitals experienced less severe Covid-19 wave than in prior period ▪ Independent pharmacies no longer supported by lockdown shopping
Slide 24: Performance and Outlook
PERFORMANCE AND OUTLOOK ▪ Total managed turnover +6.7% to R14.2bn ▪ Two new bulk distribution clients ▪ Reaching capacity in bulk DCs and rented additional facilities in Gauteng and Cape Town ▪ Generic medicines +14.6% (72% of volume) ▪ ERP / WMS implementation in Durban DC completed, Gqeberha DC to
Slide 25: Outlook
OUTLOOK BERTINA ENGELBRECHT
Slide 26: Outlook for H2 2022
OUTLOOK FOR H2 2022 ▪ Consumer environment will remain constrained, compounded by trading disruption from electricity load shedding ▪ Recovery in beauty category expected to continue ▪ Plan to open 45 Clicks stores in FY2022 ▪ UPD has secured an additional bulk contract, starting March ▪ Integrating
Slide 27: Outlook for H2 2022 (continued)
OUTLOOK FOR H2 2022 (CONTINUED) ▪ Forecast for FY2022: 30% - 35% growth in group dHEPS (FY2021: 773.6c) 25% - 30% growth in continuing dHEPS (FY2021: 793.7c) 8% – 13% growth in continuing adjusted* dHEPS (FY2021: 836.8c) ▪ Business model remains resilient, with proven ability to adapt to changing ma
Slide 28: Thank You
WMICLICKS® _ AL THANK YOU \y
Slide 29: Disclaimer
DISCLAIMER Clicks Group has acted in good faith and has made every reasonable effort to ensure the accuracy and completeness of the information contained in this presentation, including all information that may be defined as 'forward-looking statements' within the meaning of United States securities