COMPANY NEWS IN BRIEF

Clicks sees 26% profit jump

Pharmacy retailer Clicks’ half-year earnings jumped by 26%, as sales picked up by 13.6% over the six months to end-February. Clicks' headline earnings per share rose from 370.6 cents in the 2021 half-year, to 466.9 cents in 2022.

However, Clicks’ CEO Bertina Engelbrecht warned that the rest of the year will be constrained as consumers face increasing financial pressures and load shedding continues to disrupt operations.

The company increased its interim dividend by more than 26% to 180 cents per share in line with the earnings growth. Despite paying out R1.3 billion in dividends, and buying back shares, the company still has a R838 million cash pile.

Clicks opened its 800th store in March, and grew its pharmacy footprint by 45 new outlets, to bring it to a total of 646. Some 50% of South Africans now have access to a Clicks pharmacy within 5.5 km of their homes. Clicks plans to open 28 more stores this year.

The group’s clubcard membership grew to 9.5 million active members, which represent 81% of the group’s sales in the six months. Its distribution business, United Pharmaceutical Distributors (UPD) increased its turnover by 6.7%, to R14.2 billion in the half year. -Fin24

Comair needs more working capital

Comair needs to raise more working capital after it had to deal with the fallout of high oil prices, international travel restrictions during the December holiday period, and the "severe" impact of the temporary suspension of its flights.

This is according to the latest report by the company's business rescue practitioners. The report does not say how much funding needs to be raised.

Comair, which operates its own low-cost airline kulula.com, as well as British Airways domestically under a licence agreement, went into business rescue in May 2020. The Comair Rescue Consortium (CRC), comprising several former Comair board members and executives, was chosen as preferred bidder.

According to the report, Comair needs the additional funding in the short and medium term. The report adds, however, that the CRC has already raised a significant part of the working funding capital needed and is preparing a plan to raise the rest.

"Although the Brent Crude Oil price appears to have stabilised at circa US$110 per barrel, the impact on the operational performance of airlines worldwide, including the Comair, has been significant. This, together with the 'red listing' of South Africa during December 2021 and January 2022, has resulted in the company needing to raise further working capital," say the rescue practitioners. -Fin24

Eskom seeks indemnity from Karpowership

South Africa’s bid to secure 2 000 megawatts of so-called emergency electricity has hit an obstacle, with Eskom asking the biggest winner of the tender to indemnify it against any adverse outcomes from corruption allegations, two people familiar with the situation said.

A losing bidder, DNG Power, alleged in a lawsuit that government officials acted corruptly in awarding Turkey’s Karpowership about 60% of the tender that will see it supplying energy from three ship-mounted power plants off the South African coast. While DNG, which demanded that it replace Karpowership, lost the High Court case in January it has been allowed to appeal.

The government and Karpowership have denied wrongdoing.

Karpowership has declined to sign an indemnity clause, the people said, asking not to be identified because the discussions have not been made public. Eskom has yet to revert with a new proposal they said. Eskom and Karpowership declined to comment.

The process of securing the extra power in a country that’s been hit by intermittent power outages for more than a decade has been a fraught one since the contracts were awarded in April last year. -Fin24

Johnson & Johnson has filed a lawsuit

Johnson & Johnson has filed a lawsuit against drug distributors and a pharmacy seeking to stop the sale of counterfeit versions of its HIV drugs, months after a similar case brought by Gilead Sciences Inc.

In a complaint filed April 7 and made public on Tuesday, J&J said it had learned of widespread counterfeiting through complaints from patients who received the wrong pills in their prescription bottle, and from the voluntary return of hundreds of bottles of counterfeit drugs from one of the defendants, distributor ProPharma Distribution LLC.

The company also said that distribution of counterfeit versions of its HIV pills had come to light through Gilead's lawsuit, filed in January. The drugs at issue include Symtuza, a multi-drug combination treatment, as well as Prezcobix, Prezista and Edurant.

J&J said counterfeit bottles sometimes contained a different HIV drug than what was on the label, and in one case contained the powerful antipsychotic drug Seroquel.

In addition to ProPharma, the defendants are distributors Safe Chain Solutions LLC and Scripts Wholesale Inc and pharmacy operator I Care Pharmacy 14, as well as the business' individual owners. -Fin24

Syngenta Q1 sales rise 26%

Syngenta Group increased its first-quarter sales by 26% as farmers bought seeds and sprays early to avoid possible shortages later in the year, the Swiss agrochemicals company which is planning a US$10 billion IPO said on Thursday.

The results of the Chinese-owned group are seen as a bellwether for the broader agrochemicals industry, with peers including US company Corteva and Germany's BASF and Bayer due to report in the next two weeks.

BASF last month warned that it would have to stop production if natural gas supplies fell to less than half its needs. Gas provides energy for manufacturing and is also a critical raw material for its products.

Syngenta, which aims to raise about US$10 billion from an initial public offering (IPO) in China, did not comment on the progress of its planned flotation, which was paused last year.

But a source close to the company said the flotation, which would value it at around US$60 billion including debt, was on track to be completed by the end of this year. -Fin24