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Clicks sales supported by Covid-19 vaccination programme, says chief executive

Newly-appointed Clicks chief executive Bertina Engelbrecht says the JSE-listed retailer’s strong growth in sales over the 20 weeks to January 16 this year has been supported by the national Covid-19 programme. Photo: Supplied

Newly-appointed Clicks chief executive Bertina Engelbrecht says the JSE-listed retailer’s strong growth in sales over the 20 weeks to January 16 this year has been supported by the national Covid-19 programme. Photo: Supplied

Published Jan 26, 2022

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Newly-appointed Clicks chief executive Bertina Engelbrecht says the JSE-listed retailer’s strong growth in sales over the 20 weeks to January 16 this year has been supported by the national Covid-19 programme.

Retail health and beauty sales, including Clicks and those of franchise brands The Body Shop, GNC and Claire’s, had increased by 14.4 percent – from 8.1 percent in 2021 – from the corresponding 20 weeks in the previous financial year.

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Clicks is the latest retailer to issue an upbeat sales report, following Mr Price, TFG and Truworths last week. However, Woolworths last week flagged that its earnings – for the 26 weeks to end December 26 – were expected to tumble by 30 to 40 percent, with its sales dented by the prolonged lockdowns in Australia and the civil unrest that rocked South Africa in July.

Clicks said yesterday that Clicks and UPD had continued to gain market share during the period.

Sales in comparable stores rose by 11.1 percent, from 4.4 percent in the corresponding period the previous year, with selling price inflation averaging 3.3 percent, up 3.2 percent for the period.

Engelbrecht said: “The accessibility of our store and pharmacy network has been a major strategic advantage during the pandemic. Clicks also administered 1.8 million vaccines during the 20-week period, generating sales of R685 million, an uplift of 6.9 percent to retail sales. Since the start of the vaccination programme in 2021, Clicks has administered 2.4 million vaccinations and currently operates 435 sites across the country. We expect to experience a sustained demand for booster doses of the vaccine in the months ahead.”

She said the second wave of the pandemic (Beta variant) in December 2020/January 2021 was more serious than the recent fourth wave (Omicron variant) and had a major impact on South Africans as the country did not have access to vaccines at the time of the second wave.

“Last year, the second wave drove significantly higher sales of preventative healthcare products, including supplements, immunity-building vitamins, masks and sanitisers, while the impact of Omicron this year was less severe and resulted in lower purchases of medication and immune support products.”

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Clicks said in its trading update that group turnover had increased by 10.4 percent, to R15.1 billion - an increase of 10 percent

UPD’s total managed turnover, combining wholesale turnover and turnover managed on behalf of bulk distribution clients, increased by 10.1 percent, from 18.3 percent. Its wholesale turnover increased by 2.5 percent, from 11.7 percent for the corresponding period the previous year, with the growth rate impacted by the high base set in the prior period, owing to the severity of the second wave of Covid-19. This has resulted in increased hospitalisation and greater demand for medicines, compared to the fourth wave of the pandemic.

However, Clicks flagged that trading patterns were shifting as lockdown restrictions had eased, with the retailer reporting an improved performance from stores located in destination malls. However, trading continued to be adversely impacted by lost sales as a result of the stores damaged in the 2021 civil unrest in KwaZulu-Natal.

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The group said it expected to release its interim results for the six months to February, 28, 2022, around April 28.

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