SPUR, which owns Spur, Panarottis, John Dory's and RocoMamas SA, yesterday flagged that its interim sales were still 9.5 percent behind preCovid-19 levels as trading conditions continued to be impacted by various levels of restaurant trading restrictions in the reporting period, including a prohibition on sit-down trade in July 2021.
In a sales update and trading statement for the six months ended December 31, 2021, Spur, with a R2.07 billion market cap, said its franchised restaurant sales grew by 28.3 percent during the period compared to the six months to December 2020, from the previous comparable period when significant restrictions on sit-down trade were in place, and by 18 percent over the preceding six-month period ended June, 30, 2021.
“These challenging conditions were exacerbated by widespread civil unrest in specifically KwaZulu-Natal in the second week of July 2021. This resulted in nine of the group's franchised restaurants being looted and vandalised, with damages totalling R29.5 million,” it said, adding that franchised restaurant turnover was adversely impacted by R14.6m in July 2021.
Spur said it had continued to respond to the pandemic-fuelled market conditions with resilience, focusing on everyday value and convenience solutions through takeaways, click-and-collect services and third-party deliveries.
In addition, the close collaboration and partnership with the franchise network enabled several strategic initiatives to be implemented during the period, including supply chain improvements.
But conditions had improved from August to December, with strong trading in the fourth quarter of calendar year 2021, with Spur's performance continuing to recover in the first half of full year in 2022.
Looking ahead, the group said it was now expecting to report earnings per share (eps) of between 69.35 and 70.95 cents per share, in a range of between 117 to 122 percent higher, while headline eps were likely to clock in at between 69.35 and 70.95c per share, in a range of between 117 and 122 percent higher.
However, Spur noted that the most material single item in the period was a charge against earnings of R22.034m, previously paid to the SA Revenue Service (Sars), relating to a tax dispute in respect of which judgment was issued against the group by the Supreme Court of Appeal (SCA) during the period, as reported in October.
Business Report in October reported that Spur had said it would approach the Constitutional Court over a ruling by the SCA pertaining to a dispute the restaurant chain has with Sars over a R48m tax return endowed to the group's employees for a share purchase scheme.
Spur said its interim results were expected to be released on February 24.
In late afternoon trade the share was at R24.40, up 7.3 percent.
BUSINESS REPORT ONLINE