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Dis-Chem CEO steps down after sometimes controversial 40 years at the helm

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Pharmaceutical retailer Dis-Chem's Ivan Saltzman is stepping down as CEO at the end of June after more than four decades at the helm.

The JSE-listed retailer said on Monday that Saltzman, who founded the company in 1978 with his wife Lynette in 1978, will exit the top position at the end of June, but remain on board as an executive director and "an active member of the executive management team".

CFO Rui Morais, who was first announced as Saltzman's successor by the group in August 2021, will assume the CEO position from July 1. Morais has worked for the group for more than a decade.

The company, which also released a full-year trading update that showed it had delivered double-digit earnings growth, said Julia Pope, who is currently the executive head of finance, and will take over as CFO.

Shares in Dis-Chem were trading just under 2% higher at R24.10 after the market opened at 09:00.

Saltzman said in a statement that accompanied the update that over the course of the past 45 years he and his wife had "grown the business from a single store to what is today, the largest retail pharmacy chain by market share in South Africa with a network of over 300 retail stores and over 20,000 staff".

He said he was confident in, and supportive of the future leadership of the group, who share the "same commitment to the brand fundamentals that Lynette and I do".

Saltzman said he would be looking forward to spending time in various stores and identifying opportunities to expand the group's store footprint.

Dis-Chem said Saltzman had also committed to divest of 32.25-million Dis-Chem shares owned by the Saltzman family to Morais and a group of key senior executives.

The divestiture of what is an effective 3.75% interest is an incentive to ensure "their ongoing commitment".

Dis-Chem chair Larry Nestadt said Saltzman was "one of the extraordinary retailers of his generation" who had managed to transform "retail pharmacy".

"Under his leadership Dis-Chem evolved from a family business to a leading listed, and proudly South African, corporate business."

Saltzman's leadership of Dis-Chem in recent times was not without its challenges, with the CEO courting controversy in October last year, for instance, when he called for a moratorium on the hiring of whites. And while Dis-Chem managed to walk itself back from this, in March this year the company conceded that it had taken a hit because of the controversy, estimating that between 5 to 8% of its white, coloured and Asian chronic medicine clients ditched the group. 

Meanwhile, Dis-Chem's trading update for the 12 months to end February 2023 showed that that group revenue, excluding Covid-19 vaccines and testing, was up 9%, while earnings per share and headline earnings per share were expected to be in a range of between 115.6c and 118c, an increase of between 16.5% and 19%.

The company also reported it was in the final stages of possibly acquiring a 63,000m2 distribution centre in Gauteng for just over half a billion rand. 

It said the acquisition would increase its warehouse capacity by 75%, adding that the group's rapid growth had necessitated the need for additional space.

 

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