A tidy trading update from Clicks, whose share price jumped to a record high on the news that Headline Earnings Per Share (HEPS), broadly considered a reliable indicator of profitability, would be up to the tune of between +15% and +18% for the financial year through August 2019. This, they say, is attributable to a solid performance by Clicks in the second half, by pharmaceutical distributor UPD racking up some new contracts, and by improvements in the management of working capital across the business. Clicks, you will recall, is trading out of around 680 stores, with 528 pharmacies, either standalone or in store, and as of February 2019 owns almost 24% of the retail pharmacy market, with an eye on the 30% mark. UPD, South Africa’s largest full-service pharmaceutical distributor, grew turnover by about +22% to R10.2bn for the period.
Comment: Note to the young retailer, just starting out in the business: just do what Clicks does and you’ll be OK.