Spur said it had achieved a strong trading performance for the 2023 financial year, with franchised restaurant sales increasing by 23% over that of the prior financial year. Picture: Simphiwe Mbokazi (ANA)
Spur Corporation’s shares jumped 4% after the group forecast juicy annual sales and double-digit earnings, which the market relished.
The share rose to an intraday high of R24.48 on the JSE yesterday after the announcement.
In a trading statement, it said for its annual financial results for the year ended June 30, 2023, the group was expecting to report earnings per share of between 256.91 cents and 264.12c, roughly between 78% to 83% higher, while headline earnings per share were forecast at between 256.70c to 263.91c, up 78% to 83% from the prior year.
Spur reminded its shareholders that the profit for the prior financial year included the one-off income tax charge of R14 million and non-deductible interest on tax liabilities of R8.04m. These charges followed the final resolution of the group’s dispute with the South African Revenue Service in October 2021 over the treatment of its 2004–2009 share incentive scheme.
Spur said it had achieved a strong trading performance for the 2023 financial year with franchised restaurant sales increasing by 23% over that of the prior financial year.
In the first half of the 2023 financial year franchised restaurant sales grew by 31.5% over the comparable period of the prior financial year.
Spur said although economic conditions remain challenging in the face of higher inflation and severe pressure on consumer disposable income, the group’s business model continued to demonstrate its resilience. In the second half of the 2023 financial year group sales increased by 15.1% over the comparable period of the prior financial year.
In this constrained consumer trading environment, the group accelerated its marketing activity and amplified brand awareness with value-added campaigns, engaging sponsorship activity and outdoor exposure that resulted in an increase in restaurant foot count of 13%.
Restaurants remained focused on product quality and enhanced customer experience which increased customer loyalty and spend.
Reporting total restaurant sales growth for the full year to June 2023 from the prior year, Spur’s sales were 24.9% higher, Panarottis up 18.6%, John Dory’s 8.7% higher, while RocoMamas’ sales rose 9.6%.
Meanwhile, speciality brands, which include The Hussar Grill, Casa Bella and Nikos, saw sales rise 42.2%.
Total South Africa sales growth was up 22.5%, while total international sales were up 27.6%. This as total group sales growth rose 23% the full year to June 2023.
The improved trading performance, together with the high growth achieved by the retail company owned stores, led to a continued strong recovery in both group revenue and profit.
Spur also said during the 2023 financial year, the company had repurchased 1 499 891 ordinary shares. This resulted in the reduction in the dilutive weighted average number of shares in issue from 84.3 million at June 30, 2022, to 82.0 million at June 30, 2023.
The group’s annual results were expected to be released on August 22.
Last month Spur said it was taking a 60% stake in the Doppio Group, owners of the speciality restaurant brand Doppio Zero, a further indication of the recovery of Spur since the lows of the Covid pandemic.
Group CEO Val Nichas said at the time that the acquisition would strengthen Spur Corporation’s position in the daytime speciality dining segment and accelerate the group’s entry into the speciality coffee market.
BUSINESS REPORT