Leading retail pharmaceutical group Dis-chem has lost R5.21 billion in value since its controversial moratorium on hiring whites.
CEO Ivan Saltzman reportedly told investors that many regular dispensary customers have canceled scripts after a memo banning the hiring or promotion of white employees was leaked.
Also read: Outrage over Dis-Chem letter on hiring whites
Income is down
Saltzman apparently tried to downplay the loss of clients, saying Dis-chem also gained black chronic drug customers since the memo.
However, the number of clients lost far outweighed the number of clients gained.
The impact of the leaked memo was revealed in the group’s trading update for the period 1 September 2022 to 5 February 2023.
According to Everyday investorsshowed a significant decline in revenue growth which slowed to the lowest level since the company was listed in 2016.
Historically, the average group revenue growth for this reporting period was 12.4%, higher than the 8.7% in the last five months.
Also read: Dis-chem expects profit to drop as Solidarity prepares for court
Declining Dis-chem’s stock price isn’t just about memos
But analysts refused to attribute the share price of tanking Dis-chem to the reaction around the memo.
News24 reports that Dis-Chem chief financial officer Rui Morais believes that ‘stretched’ consumers are also spending less.
Trade union Solidarity, which has threatened to take the pharmacy group to court over this week’s moratorium on dropping the case, said there were no official barriers preventing white people from being hired.
But Solidarity’s CEO, Dirk Hermann, asked Dis-chem to take disciplinary action against Saltzman.
Compiled by Narissa Subramoney
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