Clicks Group offers sustainable long-term growth prospects for equity investors seeking non-cyclical exposure to the retail and healthcare sectors in South Africa.

Healthcare markets are defensive and growing

  • Over 80% of group turnover is in defensive merchandise categories
  • Trading through the Covid-19 pandemic has demonstrated the resilience of the business and the markets in which it operates
  • Improving living standards, increasing urbanisation and longer life expectancy is contributing to a growing market for health and beauty products

Convenient and expanding retail footprint

Goal to expand Clicks store base in South Africa to 900 in the long term

  • Over 780 Clicks stores
  • More than 70% of stores located in convenience and neighbourhood shopping centres, which has proved beneficial during the Covid-19 pandemic as customers shopped closer to home
  • Targeting to open 25 – 30 stores each year

Market leadership

  • Clicks is the largest retail pharmacy chain in South Africa
  • UPD is the country’s leading national full-range pharmaceutical wholesaler
Lady holding product

Expanding pharmacy network

Objective to operate a pharmacy in every Clicks store in South Africa

  • 621 pharmacies in Clicks stores
  • Targeting to open 30 – 35 pharmacies each year
  • Retail pharmacy market share goal of 30% in the long term (2021: 23.4%)
  • Accessibility of the pharmacy network enabled Clicks to rapidly scale vaccination sites in over 500 pharmacies

Differentiated product offer

Private label and exclusive brands offer differentiated ranges at higher margins

  • Target to grow private label to 25% of total health and beauty sales; currently 24.5%
  • Clicks offer differentiated products with exclusive health and beauty brands such as The Body Shop, GNC and Claire’s

This investment case should be considered together with the group strategy report which outlines the group’s strategic objectives and drivers of longer-term growth.

Lady holding product

Robust supply chain

Centralised supply from company-owned distribution centres to all retail stores (97.9% of product through centralised distribution)

  • UPD provides an efficient healthcare supply chain channel for Clicks
  • UPD also offers wholesale and distribution services to pharmaceutical manufacturers

Globally competitive operating margins

Retail and UPD operating margins rank in the upper quartile of global drugstores and pharmaceutical wholesalers

  • Retail: 9.5% (medium-term target 9.0% – 10.0%)
  • UPD: 3.3% (medium-term target 2.8% – 3.3%)


ClubCard is one of the largest retail loyalty programmes in South Africa

  • 9.2 million active ClubCard members generate 80.2% of sales
  • Online store offers full Clicks product range for in-store collection or home delivery as well as online-only offers
  • Investment in online and digital capability has positioned Clicks to manage the significant growth in e-commerce during Covid-19

EFFICIENT cash and capital management

  • Highly cash-generative business
  • R13.4 billion cash generated from operating activities before dividends paid over past five years
  • Returns enhanced through active capital management
  • R6.4 billion returned to shareholders in dividends and share buy-backs in past five years
  • Well-invested store base and supply chain
  • R3.1 billion capital expenditure in past five years

Commitment to sound environmental, social and governance practices

  • ESG practices aligned with selected United Nations Sustainable Development Goals
  • Inclusion in the FTSE4Good Index recognises the standard of the group’s ESG practices
  • R675 million invested in training and development over past five years
  • Experienced, independent, diverse and well-balanced board