Dis-Chem has announced its interim results for the six months from 1 March to 31 August 2025, reporting Group revenue growth of 8.7% to R21.3 billion and basic earnings per share (EPS) and headline earnings per share (HEPS) of 73.9 cents and 73.8 cents, respectively - increases of 9.6% and 9.0% over the comparable period.

Chief Executive Officer Rui Morais says, “Following the identification of the eight strategic areas of focus aimed at delivering sustainable shareholder returns, the Group has made pleasing progress in each of these areas. The launch of our new loyalty programme, Better Rewards, marks the next chapter in our journey to increase access to quality primary healthcare across a wide consumer base.”

“This programme reimagines how loyalty can empower participation in a healthcare ecosystem, unlocking tangible value that customers can reinvest in their health. Supported by a broader portfolio of healthcare and financial services, Better Rewards is designed to compound good health decisions over time, rewarding individuals for the proactive management of their wellbeing and chronic conditions”.

Dis-Chem’s X, bigly labs serves as the innovation engine behind this transformation. The team applies technology, data and deep customer insight to solve complex challenges and spearheads an execution model that strengthens customer-centred growth. The launch of Better Rewards stands as a proof point of innovation in action, a smarter and more connected health ecosystem where cutting-edge technology and customer obsession converge to create meaningful value.

Through the Better Rewards Pharmacy Boost, customers are rewarded for filling their scripts and adhering to chronic treatments, reinforcing the Group’s focus on prevention and protection rather than reaction. Better Rewards demonstrates how purpose, technology and scale combine to make quality healthcare more affordable, more accessible and more human.

Core Retail Trading Performance

Excluding the R130 million ecosystem investment, core retail profit before tax increased by 25.8% year-on-year.

Ecosystem investments have the objective of transitioning the Group from pharmacy retailer to integrated healthcare provider ensuring its establishment as South Africa’s healthcare authority with the purpose of increasing access and reducing the cost of care; creating an ecosystem that positions the Group to play the dual role of healthcare provider and funder, using an innovative operating model to reimagine and disrupt the manner in which South Africans access healthcare; and healthcare delivery, both products and services, creating a further resilience that secures the traditional retail basket, increasing customer lifetime value.

Of the R130 million invested, 60% was invested in establishing and operationalising X, bigly labs.  The investment is aimed at generating returns in the core retail business over time. During the period, proof points included the launch of Better Rewards, a new analytically led promotional engine, and improvements in omnichannel retailing.

The remaining 40% supported Dis-Chem Life, with the majority being invested in marketing to establish the brand and operating costs to scale the business. Dis-Chem Life’s products are centred in the integrated healthcare ecosystem and are designed to encourage and reward policyholder health through Better Rewards.

The fundamental reason for the strong result in core retail was the positive operating leverage relationship between retail total income and retail operating costs. Dis-Chem Health, included in core retail, is now contributing positively to the performance of the retail business.

Revenue

Group revenue grew 8.7% to R21.3 billion for the six months ended 31 August 2025.

Retail revenue increased 8.3% to R18.1 billion, with comparable pharmacy store revenue up 5.4%. 17 retail pharmacy stores were opened, resulting in 302 retail pharmacy stores and 44 retail baby stores as at 31 August 2025.

Wholesale revenue grew by 11.1% to R16.8 billion. Wholesale revenue to its own retail stores, still the biggest contributor, grew by 10.9% while external revenue to independent pharmacies and The Local Choice (TLC) franchises grew by 11.6% over the comparable period. Independent pharmacy growth was 7.9% attributable to both new customers and increased support from the current base, and TLC growth was 16.5% due to a combination of an increase in TLC franchise stores from 221 to 258 together with increasing support of the supply chain from existing TLC franchisees. The wholesale business now services 1,608 independently owned pharmacies, representing approximately 85% of the independently owned pharmacy market.

Total Income

Total income grew 9.9% to R6.6 billion, with the total income margin improving to 31.1% (HY2024: 30.7%).

Retail total income grew by 10.7% with retail total income margin increasing from 30.2% to 30.8% over the comparable period. The increase in retail total income margin was predominantly due to an increase in transactional gross margin across all core categories. Trade terms increased ahead of purchases growth due to increased scale. Wholesale total income grew 5.0% year-on-year.

Expenses

Group expenses increased 10.1% over the comparable period. Retail expenses grew 11.7% as the Group continued its expansion strategy. Retail employment costs, accounting for 54% of retail expenses, rose 8.7%. On a like-for-like basis, retail store payroll costs increased only 2.5%, reflecting the success of staffing framework 1.0. Wholesale expenses rose 2.5%, supported by operational efficiencies.

Outlook

For the two-month period 1 September to 26 October 2025, Group revenue grew by 9.7% year-on-year.

“The consumer environment remains constrained, but our innovation pipeline and data-led approach are positioning us for long-term, sustainable growth. The establishment of X, bigly labs has accelerated our transition toward an integrated health and wellness ecosystem that places the customer firmly at the centre,” says Morais.

Strategic priorities for FY2026 and beyond include the continuing expansion toward the 137,000m² retail space target, with 32 pharmacy stores planned for FY2026; launch of the ‘Store of the Future’ concept in Q1 FY2027, designed for true omnichannel retail and healthcare delivery; ongoing refinement of promotional mechanisms aligned with Better Rewards; the launch of a new mobile app in mid-FY2027; and deepening customer engagement with enhanced value creation that drives customer lifetime value across the ecosystem through data-driven insights and partnerships, including the Capitec collaboration. Advancing staffing framework 2.0 and unlocking R500 million in working capital by end-FY2026 remains a focus as does the continued focus on people and culture, positioning employees as ambassadors for the ecosystem strategy.

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