Dis-Chem has announced its interim results for the six months from 1 March to 31 August 2026, reporting strong Group revenue growth of 8.0% to R23-billion. Basic earnings per share (EPS) and headline earnings per share (HEPS) were 64.1 cents and 64.3 cents respectively, decreases of 13.3% and 12.8% on the comparable period.
Chief Executive Officer Rui Morais says, “Our revenue growth, market share gains and improved retail total income margin highlight the sustainability of the Better Rewards programme. It supports business growth while offering customers value at the till, as they remain constrained by the current economic climate.”
Better Rewards supported revenue growth, notwithstanding temporary price deflation across 45% of front shop retail sales. One year after its October 2025 launch, the programme has returned R1.5-billion in instant value to customers, in addition to retail promotional activity. Following the anniversary, the base effects created by the programme will unwind, with natural inflation supporting retail revenue growth.
Better Rewards since launch
Active membership grew 27% to 8.2 million, including 760 000 reactivated and 980 000 new members, with members contributing 86.1% of total sales. The participating brands also expanded from 140 to 200 brands, which now collectively account for 45% of front shop retail sales. Dis-Chem front shop volume growth was 5.5%, against 0.1% for the rest of the market (NielsenIQ, 52 weeks to 27 September 2026). Pharmacy revenue grew 10.4%, industry-leading, with further market share gains. Active members who shopped before the launch now shop two more times on average, with basket value up by 3.5%.
Stores, structure and innovation
The Group continued to increase its retail footprint, opening 14 retail pharmacy stores, including two Store of the Future format stores at Melrose Arch and Irene Village. The initial trading densities of these stores exceed those of original-format stores at the same stage by 25%, indicating faster maturation and higher trading densities at maturity, with improved working capital metrics.
The organisational restructure is 60% complete and is expected to conclude in December 2026. It has achieved a more appropriate CEO span of control and clearer accountability, enabling faster and more effective execution amplified by data-led innovation from X, bigly labs, the Group’s innovation engine.
X, bigly labs has driven a shift towards data-led commercial decisioning. The cost investment in X, bigly labs doubled over the corresponding period, during the start-up phase of the unit. As X, bigly labs nears its established state, it will continue to operate under the cost discipline philosophy of the Group.
Revenue
Retail revenue increased 8.2% to R19.6-billion, with comparable pharmacy store revenue up 3.4%. With 14 stores opened, the Group had 328 retail pharmacy stores and 36 retail baby stores at 31 August 2026.
Wholesale revenue grew 9.6% to R18.4-billion. Revenue to the Group’s own stores, still the biggest contributor, grew 10.3%, while external revenue to independent pharmacies and The Local Choice (TLC) franchises grew 7.0%. Independent pharmacy growth was 5.0%, and TLC growth was 9.3% as franchise stores increased from 258 to 294. The wholesale business now services 1,690 independent pharmacies, about 89% of that market.
Total income
Total income grew 9.0% to R7.2-billion, with the margin improving to 31.4% from 31.1%. Retail total income rose 11.1% and its margin improved from 30.8% to 31.7%, due to more effective promotions, higher transactional gross margin across core categories and sustainable Better Rewards funding. Wholesale total income margin declined from 8.0% to 7.3% because of the lower single exit price (SEP) increase.
Expenses
Group expenses increased 12.1%. Retail expenses grew 13.7% as the Group invested in new stores and X, bigly labs, with retail employment costs, 53.0% of the total, rising 12.8%. Management remains focused on keeping employment cost growth below retail total income growth. Wholesale expenses rose 8.9%, supported by network cost efficiencies.
Balance sheet and dividend
Net working capital improved to 18.8 days from 24.4 days at 28 February 2026. Capital expenditure was R712-million, of which R492-million was expansionary and R220-million replacement. A gross interim dividend of 25.62 cents per share was declared, 12.9% lower than the prior period and based on 40% of headline earnings. The payment date is Monday, 23 November 2026.
Outlook
For the seven weeks from 1 September to 19 October 2026, Group revenue grew 7.9% year-on-year. Retail revenue rose 7.2%, supported by five new pharmacy stores, and external wholesale revenue grew 12.4%. As per Nielsen IQ, September showed the strongest market share gains across the prevailing seven months with Dis-Chem front shop volume growth of 4.9%. Over the same period, the total market (excluding Dis-Chem) volume declined by 2.6%.
Better Rewards serves the dual purpose of supporting business growth while offering customers value at the till as they remain constrained due to the current economic climate.
Serving as a health funding mechanism that underpins Dis-Chem’s positioning as South Africa’s go-to health authority with the purpose of increasing access to and reducing the cost of care, the programme attracts and retains customers, drives frequency and supports basket size. Better Rewards is now well established, with brand and partner participation secured and sustainable funding agreements in place. Further promotional investment will be focused on predictive and adaptive offers delivered through X, bigly labs.
“The Better Rewards programme reimagines how loyalty can empower participation in a healthcare ecosystem, unlocking tangible value that customers can reinvest in their health. The R1,5 billion in instant value returned to customers stands as proof of innovation in action and exemplifies how a more connected health ecosystem and customer obsession converge to create meaningful value while realising greater access to affordable healthcare delivery,” says Morais.
Strategic priorities for FY2027 include the opening of 30 retail pharmacy stores, 19 of which are already trading. All new stores will adopt the Store of the Future format, the Health Hub, while existing stores are being prioritised for revamps based on their potential to drive revenue and earnings growth.
X, bigly labs houses the ambition for the Group’s digital ambitions, and since its launch, R240 million has been deployed to re-platform Dis-Chem’s digital estate and the consequential transformation of the operational business beneath it. This capital investment in e-commerce has resulted in the re–engineering of the core commerce platform and the supporting retail capabilities, ensuring best-in-class cataloguing, pricing, fulfilment and order management. The business now runs on a modern, scalable foundation and the same approach is being followed for health digitisation in the pharmacy and clinic.
The Group has launched the first release of its new app to 22,000 customers, with the upcoming second release to be extended to a broader customer audience in the last quarter of FY2027.
