RocoMamas opens branches in India and Saudi Arabia

The Spur Corporation has released its financial result for the six months ending 31 December 2018, reporting a competitive trading performance in an environment of low economic growth in South Africa.

Total franchised restaurant sales across the local and international operations increased by 4.8% to R3.9 billion, and by 6.5% excluding the results of the Captain DoRegos chain which was sold in March 2018.

Sales increased by 11.3% in the first quarter to September 2018, supported by the continued recovery by the Spur brand and a strong performance in The Hussar Grill brand.

However, sales growth in the second quarter to December 2018 slowed to 1.2% as discretionary spending came under growing pressure – which contributed to a further decline in shopping centre foot traffic, the group said.

“Management’s primary focus in the current economic climate has been on enhancing franchisee profitability to ensure the sustainability of the group’s business model,” the group said in a statement.

“Following the successful changes to the promotional and discounting strategies for Spur in the previous financial year, further initiatives are being undertaken to improve franchisee margins across the brands.

“These include expanding the range of “home-made” products manufactured in Spur restaurants, rationalising menu offerings in certain brands to promote efficiencies, renegotiating rentals and reducing the size of restaurants where appropriate.”

RocoMamas

Restaurant sales in RocoMamas grew by 6.0% as the brand’s urban millennial market was not immune to the economic downturn, the Spur Corporation said.

“The brand has been through a period of consolidation following the unprecedented increase in restaurant numbers, which saw its national footprint expand to 70. RocoMamas has grown restaurant sales by an annual compound rate of 45.9% since being acquired by the group in 2015.”

As at the end of 2018, the group had 70 RocoMamas restaurants in South Africa and 11 international points of presence.

These included recently opened RocoMamas restaurants in India, Mauritius, Botswana and Saudi Arabia.

However, the group acknowledged that the brand was in a consolidation period locally.

This was highlighted by the RocoMamas in Green Point (Cape Town) where turnover declined by 31% following the opening of a franchised RocoMamas restaurant in a nearby suburb which diverted takeaway and delivery business, the group said.


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RocoMamas opens branches in India and Saudi Arabia