Business

Spur in hot water in South Africa

Caitlyn Hilliard-Lomas

 ·12 Aug 2026

Spur has informed its shareholders that it has set aside R129.5 million to cover potential damages from a lawsuit filed by GPS Food Group in 2019. 

In a statement released on the JSE’s SENS earlier this month, Spur announced its plans to appeal the damages claim in its entirety. 

The company has been advised that it is likely to succeed in this appeal, it said, with a hearing scheduled next year. 

This legal battle with GPS will become a nearly decade-long saga for Spur, as the first summons was served in 2019. 

In the initial summons, GPS claimed that an oral agreement was reached among itself, Spur Group, and Spur Corporation to acquire, develop, and manage a rib-processing facility. 

Claim A, which represents GPS’s damages claim, ranged from R119.9 million to R167 million. 

There is an alternative delictual claim worth R95.8 million representing GPS’s alleged accumulated losses, classified under Claim B. 

In 2019, Spur and GPS agreed to try to resolve the dispute through arbitration, which commenced on 23 October 2023. 

On 26 August, 2025, Spur informed its shareholders that the arbitrator had issued a partial award in favour of GPS on Claim A and dismissed Claim B.

On 3 August 2026, the arbitrator notified Spur that damages of R74.6 million had been awarded to GPS related to Claim A. 

As such, Spur told shareholders on 7 August 2026 that it will raise a provision in its upcoming financial results for the damages award. 

Spur must account for interest at the prescribed rate of 10% from the date of the original summons in 2019. This adjustment brings the total provision to R129.5 million.

“Spur intends to lodge an appeal against the award in its entirety. An appeal award would be final and binding, and there is no further right of appeal,” Spur said. 

“The group’s senior counsel has advised that it is in their view likely that the group will succeed in its appeal against the Claim A award,” it said.

The lawsuit will not affect Spur’s liquidity position

Spur is not escaping financial difficulties in the short term, as the R129.5 million provision is set to significantly affect its results for the year ended June 30, 2026. 

In a trading statement, Spur indicated that this one-time provision will lead to a decline in both earnings per share and headline earnings per share. 

Earnings per share for Spur are expected to decrease by between 31% and 41%, while headline earnings per share are projected to fall by between 34% and 43% compared to the previous year.

The company has shared an adjusted earnings-per-share metric to demonstrate its performance excluding the GPS claim. 

For the year, Spur is expected to report growth in this metric between 5% and 13% when it releases its results on August 20, 2026. 

Spur has reassured shareholders that the damages awarded in the claim will not affect its liquidity, as the company has enough cash reserves to cover the claim.

As a result, Spur’s liquidity position and its dividend declarations will remain unaffected by this award.

Spur is currently finalising its annual financial results for the year ending 30 June 2026. 

Spur has notified its shareholders that, due to a one-time provision, it expects to report earnings per share (EPS), headline earnings per share (HEPS), and adjusted headline earnings per share (Adjusted HEPS) for the current year within certain ranges.

The calculation of Adjusted HEPS for the year ended 30 June 2026 excludes the non-recurring GPS claim provision mentioned earlier. 

Spur highlighted that the financial information on which this trading statement is based is the responsibility of the group’s directors and has not been reviewed or reported on by the group’s independent auditor.