Slide 1: Annual Results for the year ended 31 August 2024
ANNUAL RESULTS for the year ended 31 August 2024
Slide 2: Contents
Contents 01 Review of the year 02 Financial results 03 Trading performance 04 Strategy and outlook 05 Questions 2
Slide 3: Review of the year
01 Review of the Bertina year Engelbrecht 3
Slide 4: Review of the year
Review of the year • Performance continues to prove the resilience and defensiveness of the group • Diluted HEPS up 14.3% • Clicks opened 936th store and 720th pharmacy • Unicorn resolution approved by DoH in August 2024 • Market share gains in all core categories • UPD successfully completed system
Slide 5: ESG integrated into the business
ESG integrated into the business • In FTSE4Good Index for last eight years • AA ESG rating from MSCI • Continued investment in bursary, graduate and learnership programmes • Supporting gender diversity & empowerment • 89% in UN Women's Empowerment Principles • R1.2bn bought from black-owned small bu
Slide 6: Financial Results
02 Financial Results Gordon Traill 6
Slide 7: Financial highlights
Financial highlights Turnover up Total income margin Trading margin Diluted HEPS up 9.2% up from 29.2% to up from 8.7% to 14.3% Retail turnover up 11.7% 30.2% 9.2% to 1 193.5 cps UPD total managed turnover down 6.7% Cash generated Returned to Return on equity Total dividend up by operations sharehol
Slide 8: Turnover
Turnover % same % stores % R’m 2024 2023 change growth inflation Retail 35 438 31 725 11.7 8.4 6.3 Distribution 17 750 17 175 3.3 3.0 Intragroup turnover (7 750) (7 278) 6.5 Total group 45 438 41 622 9.2 5.2 • Strong growth in beauty & personal care • Retail price inflation 5.7% in H2 versus 7.4% in
Slide 9: Total income
Total income % 2024 2023 R’m 2024 2023 change % margin % margin Retail 12 264 10 836 13.2 34.6 34.2 Distribution 1 769 1 600 10.5 10.0 9.3 Intragroup turnover (318) (276) Total group 13 715 12 160 12.8 30.2 29.2 • Retail margin driven by good growth in beauty, Sorbet franchise fees and fewer pharmac
Slide 10: Trading expenditure – Retail
Trading expenditure – Retail % R’m 2024 2023 change Depreciation – PPE 575 511 12.4 Depreciation – ROU asset 1 032 903 14.3 Occupancy costs 210 187 12.3 Employment costs 4 529 4 035 12.3 Other costs 2 290 2 041 12.2 Total retail costs 8 636 7 677 12.5 % of turnover 24.4% 24.2% Finance costs – lease
Slide 11: Trading expenditure – Distribution
Trading expenditure – Distribution % R’m 2024 2023 change Depreciation – PPE 58 29 96.7 Depreciation – ROU asset 17 18 (1.7) Occupancy costs 4 4 2.7 Employment costs 378 359 5.3 Other costs 738 703 5.0 Total distribution costs 1 195 1 113 7.4 • Depreciation of PPE driven by investment in systems (R1
Slide 12: Trading profit
Trading profit % 2024 2023 R’m 2024 2023 change % margin % margin Retail 3 628 3 159 14.8 10.2 10.0 Distribution 574 488 17.6 3.2 2.8 Intragroup (30) (24) Total group 4 172 3 623 15.1 9.2 8.7 • Stronger growth in higher margin categories in Retail • UPD recovered from prior year systems implementati
Slide 13: Growth in turnover, profit and margin
Growth in turnover, profit and margin 9.2% 8.7% 8.3% 8.4% 44 000 8.2% 5000 45 438 40 000 41 622 39 587 36 000 37 339 4000 4 172 32 000 33 889 3 623 28 000 3000 3 325 24 000 3 045 2 813 20 000 16 000 2000 12 000 8 000 1000 4 000 - 0 2020* 2021* 2022* 2023 2024 Turnover(R’m) Trading profit (R’m) Tradi
Slide 14: Inventory
Inventory Days in stock Inventory (R’m) 2024 2023 2024 2023 % change Retail 76 75 5 245 4 656 12.7 Distribution 42 39 1 999 1 805 10.8 Intragroup inventory (181) (151) Total group 74 71 7 063 6 310 11.9 • Retail inventories impacted by earlier imports, new stores opened in August and focus on availa
Slide 15: Cash management
Cash management R’m 5 902 99 (1 008) (251) (1 068) (891) (1 676) 2 705 (835) (22) 2 455 Cash Operating Repayment Working Net finance Taxation Capex Dividends Share Other Cash FY2023 profit of lease capital costs buybacks investing FY2024 before liability movements activities working capital • R1.35
Slide 16: Capital expenditure
Capital expenditure • R1 025m capex planned for FY2025 • R578m on stores: - 40 – 50 new Clicks stores and pharmacies - 70 – 80 store refurbishments • R447m on infrastructure: - R86m on UPD IT and warehouse equipment - R361m on retail systems and infrastructure • R1.0 – R1.1bn p.a. capex planned for
Slide 17: Medium-term financial targets
Medium-term financial targets Achieved Medium-term in FY2024 target ROE (%) 46.4 40 – 50 ROIC excluding IFRS 16 (%) 45.6 40 – 50 ROIC (%) 29.7 20 – 30 ROA (%) 14.3 11 – 15 Net working capital days 35 30 – 35 Group trading margin (%) 9.2 9.0 – 10.0* Retail 10.2 10.0 – 11.0* Distribution 3.2 2.8 – 3.3
Slide 18: Sustained financial performance
Sustained financial performance 65% 65% 65% 10-year 63% CAGRs 62% 62% 60% 60% 59% 59% Total 1 194 shareholder 1 045 1 033 return³: 20.7% 776 774 754 679 664 637 Diluted HEPS: 575 13.5% 502 490 450 445 439 384 380 322 Dividend per 272 235 share: 2015¹ 2016¹ 2017¹ 2018¹ 2019 2020 2021 2022 2023 2024 1
Slide 19: Continued share price outperformance
100 300 400 600 200 500 0 Sep-2014 Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015 Mar-2016 Jun-2016 Sep-2016 Dec-2016 Mar-2017 Jun-2017 Clicks Group share price Sep-2017 Dec-2017 Mar-2018 Jun-2018 Sep-2018 Dec-2018 Mar-2019 Jun-2019 Sep-2019 Dec-2019 Mar-2020 Jun-2020 Sep-2020 Dec-2020 Mar-2021 FTSE/J
Slide 20: Trading Performance
03 Trading Performance Bertina Engelbrecht 20
Slide 21: Clicks business review
Clicks business review Clicks Group Annual Results 2024 21
Slide 22: Retail sales performance
Retail sales performance % change % contribution Pharmacy 8.9 27.5 Front shop health 10.7 25.3 Beauty and personal care 15.9 32.1 General merchandise 10.1 15.1 Total turnover 11.7 100.0 • Comparable stores turnover growth of 8.4% • Inflation 6.3% • Volume growth of 2.1% Clicks Group Annual Results 2
Slide 23: Market shares
Market shares % 2024 2023 Health Retail pharmacy* 24.2 23.7 Front shop health** 34.2 33.1 Baby** 22.5 21.0 Beauty Skincare** 43.8 42.7 Haircare** 33.1 32.6 Personal care** 22.1 20.7 General merchandise Small electrical appliances** 19.0 19.5 * Per IQVIA (Private Retail Pharmacy S1-6) (restated) ** P
Slide 24: Performance and strategy: Maintaining value
Performance and strategy • Maintaining value Clicks price index* vs: • Price competitive with Retailer A 96.9 Retailer B 98.6 all national retailers Retailer C 99.1 • Promotional sales +14.6% Retailer D 96.6 to 44.9% of turnover * Excluding all promotional pricing, bulk deals and 3 • In pharmacy, ge
Slide 25: Performance and strategy: Differentiating our product offer
Performance and strategy • Differentiating our product offer • Private label +13.5% to 25.4% of sales (front shop 30.3%, pharmacy 11.5%) • Clicks Made 4 Baby nappy range and Sorbet BB Cream voted SA Product of the Year in their categories • Six Clicks Baby stores and five store-in-stores performing
Slide 26: Performance and strategy: Engaging customers through personalisation
Performance and strategy • Engaging customers through personalisation • 11.8m active ClubCard members, 81.7% of sales • Winner of Best Strategic Use of Data Analytics / CRM Applications and Best Use of AI to Improve Loyalty Experience at 2024 SA Loyalty Awards • Online purchases and ‘research online
Slide 27: Performance and strategy: Extending convenience
Performance and strategy • Extending convenience Format Total • 936* Clicks stores with 720 pharmacies Convenience 712 Destination 224 • 51% of population < 5.0km of a pharmacy Total 936 • Planning rollout of UniHealth specialised format • Opening clinics and trialling smaller formats • 234 stores l
Slide 28: UPD business review
UPD business review Clicks Group Annual Results 2024 28
Slide 29: Fine wholesale turnover
Fine wholesale turnover 56.1% • Wholesale turnover down 0.5% Clicks (+6.8%) (up 1.2% in H2) 37.6% Private Hospitals • Impact of systems change on Clicks (-5.7%) purchases from UPD in H1 (H2 +8.5%) • Hospital business still recovering 6.3% (H2 -3.4% vs H1 -8.1%) Independent Pharmacies and other Chann
Slide 30: Review of the year
Review of the year • Total managed turnover -6.7% to R29.9bn • Non-renewal of two contracts (annual turnover of R3bn) • Generic medicines 68.8% of volumes • ERP and WMS implementation • Lea Glen DC successfully completed in H1 • Clicks Pharmacy purchasing compliance back to 98% • Ordered 42 EV deliv
Slide 31: Strategy and outlook
04 Strategy and outlook Bertina Engelbrecht 31
Slide 32: Outlook
Outlook • Consumer environment is improving due to lower inflation, interest rates and fuel costs, stronger Rand and reduced loadshedding • The group is well positioned due to: • Competitive advantage in defensive health and beauty sectors – with market-leading shares in core retail categories and i
Slide 33: Outlook (continued)
Outlook (continued) • Medium-term target of 1 200 Clicks stores • Plan to open 40 - 50 stores and pharmacies per year • Higher level of dispensary openings in FY2025 • Roll out of 10 UniHealth specialised pharmacy format • R1bn p.a. in capex planned - continued investment in systems • Executive team
Slide 34: Questions
05 Questions 34
Slide 35: 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