Leading retail pharmacy group, Dis-chem has lost R5.21 billion in value since its controversial moratorium on hiring whites.
CEO Ivan Saltzman reportedly revealed to investors that many regular dispensary customers had withdrawn their scripts after the memo banning the hiring or promoting of white employees was leaked.
ALSO READ: Fury over Dis-Chem letter on hiring of whites
Revenue down
Saltzman apparently tried to downplay the loss of clientele, saying Dis-chem had also gained black chronic medication customers since the memo.
But, the number of clients lost exceeded the number of clients gained.
The impact of that memo leak was revealed in the group’s trading update for the period of 1 September 2022 to 5 February 2023.
According to the Daily Investor, it showed a significant decrease in revenue growth which slowed to the lowest level since the company was listed in 2016.
Historically its average group revenue growth for this reporting period was 12.4%, significantly higher than the 8.7% over the last five months.
ALSO READ: Dis-chem expects drop in profit as Solidarity prepares for court
Decreased Dis-chem share price not just about the memo
But analysts are reluctant to attribute Dis-chem’s tanking share price entirely to the reaction around the memo.
News24 reported that Dis-Chem chief financial officer Rui Morais believed that ‘stretched’ consumers were also spending less.
Trade union Solidarity, who threatened to take the pharmacy group to court over the moratorium this week dropped its case, saying there was no official barrier preventing whites from being hired.
But Solidarity CEO, Dirk Hermann, called on Dis-chem to institute disciplinary action against Saltzman.
Compiled by Narissa Subramoney
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