Dis-Chem aims to increase its number of stores to 500 within three years and will revamp its e-commerce platform with a new app to improve online sales.
Dis-Chem had 302 retail pharmacy stores and 44 retail baby stores at end-August, the end of its financial 2026 first half. It plans to have added 32 pharmacy stores by the end of the financial year.
CEO Rui Morais said most of the 32 stores would be in areas where Dis-Chem was under-represented. The brand was not as well represented in KwaZulu-Natal and the Western Cape as it was in Gauteng, he said.
Dis-Chem is transitioning from “pharmacy retailer” to “integrated health-care provider” with a range of products including virtual doctor consultations, life cover and medical insurance. Its clinics will offer free services such as family planning and baby vaccinations on behalf of the state.
Dis-Chem recently relaunched its new loyalty programme, Better Rewards, which it says offers customers more discounts.
Morais acknowledged the company’s e-commerce offering had been relatively weak, “if we are honest with ourselves”.
“The new app launch is going to do something that is super cool. It’s going to integrate retail and health-care delivery into the digital world. So you can shop better rewards in the digital world, as you can in the physical world.”
Dis-Chem is facing competition from traditional food retailers who are increasingly expanding into pharma products. Spar recently acquired Aptekor Group, a pharmaceutical wholesaler based in the Western Cape. Shoprite is expanding its Medirite pharmacy business.
Morais said there has always been a keen interest in pharmacy from traditional retailers.
Am I concerned? I’m as concerned as I am every year, because the competitive landscape is always the same
— Rui Morais
“I think sometimes what’s forgotten is that running a pharmacy is a niche in itself. It’s not like running other aspects of a traditional retailer. And that’s probably been the success behind us and Clicks.
“Am I concerned? I’m as concerned as I am every year, because the competitive landscape is always the same,” he said.
“Someone sees an opportunity in pharmacy, and they pursue it. I’m less concerned about Spar — it is always going to be an independently owned model… If the pharmacy itself is independently owned, it’s quite difficult to put guardrails up to get a cohesive brand and move it in a single direction.
“Shoprite will always be a concern in whatever they end up doing, just because of the sizing scale of the business.”
Group revenue grew 8.7% to R21.3bn for the six months to August. Retail revenue increased 8.3% to R18.1bn.
In addition to retail stores, Dis-Chem has a wholesale and distribution business that sells medication and health and wellness products to independent pharmacies.
It also created its own franchise business, The Local Choice (TLC), which over the years has attracted new entrepreneurs and drawn in some independent chemists.
TLC franchise stores grew from 221 to 258 in the interim period. Wholesale revenue grew 11.1% to R16.8bn. The business now services 1,608 independently owned pharmacies, representing about 85% of the independently owned pharmacy market.
“The real task is to convert [the rest of] those independents to TLC,” said Morais.
Sean Culverwell, investment analyst at Anchor, said Dis-Chem’s results were mixed.
“While the core retail business appears to have gone up a gear, and outpaced Clicks over the past six months, this positive momentum was offset by higher operating expenses. These additional costs diluted the underlying strength in trading performance and weighed on profitability.”
He said the store roll-out guidance had again moderated, from 39 originally, “implying they have a lot of work to do in 2027 if they want to meet their medium-term target”.
“We are becoming accustomed to Dis-Chem backtracking on their rollout guidance. On a positive note, we are excited to see the benefits of the new rewards programme come through and market share losses appear to have steadied.”
Asked at the results presentation how confident he was about reaching Dis-chem’s 137,000m² retail space target, Morais said: “The answer lies in whether the spaces we’ve committed to, get delivered within the timeframes set by developers. Obviously if developers push out [their] timelines, our timelines are pushed out with them. We are confident we will deliver 137,000m² and beyond.”
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