Spur boosts earnings and hikes dividend

 ·29 Feb 2024

Local and national government failures are placing serious strain on restaurant group Spur’s purse strings – but the group still managed to boost its earnings and up its dividend.

In its interim results for the six months ended 31 December 2023 (H1 FY23/24), the group said that total restaurant sales increased by 10.4% from the prior comparable period to R5.4 billion.

Following a successful purchase in December, the Doppio Collection, including Doppio Zero, Piza e Vino and Modern Tailors, added R66.7 million to sales in one month of trade from 37 franchised and company-owned restaurants, as well as the Doppio bakery business.

Headline earnings per share also increased by 16.4% to 159.59 cents, with the group upping its interim dividend by almost 16.0% to 95 cents.

Financials(H1 FY22/23)(H1 FY23/24)Change
Earnings per share137.14 cents159.53 cents+16.3%
Headline earnings per share137.14 cents159.59 cents+16.4%
Interim dividend82 cents95 cents+15.9%

The group said the first quarter of the reporting period delivered a strong performance off a high base, with increased customer foot traffic.

Although the second quarter was marked by a slow start, the December 2023 period saw 251 of the 305 Spur restaurants in South Africa exceeding their turnover records.

This was boosted by high tourism numbers in the Western Cape, which led to double-digit growth for the festive season trading period. The group’s brands in KwaZulu-Natal also performed well despite the impact of roadworks, heavy rains and beach closures.

“However, cost of living and economic constraints continue to impact household spend and disposable income,” the group said.

“Lower- and middle-income consumers are diverting a greater share of their wallets to fund the increasing cost of food, housing, energy and transport. Consumer confidence continues to decline.”

Load shedding also continued to place pressure on franchisee profitability as alternative power systems became an everyday expense.

“Currently, the challenge is continuous repair and replacement of generators, with 99% of restaurants equipped with alternative power solutions.”

In addition, the inability to access clean and reliable water in certain regions became more prevalent, which forced franchisees to seek alternatives.

217 stores have invested in infrastructure to secure a supply of usable water, with the group set to focus further investment in alternative water reserves in the future.

The incoming national minimum wage, effective 1 March 2024, will also add further cost pressures. However, the group did note that the increased wage will expand its customer base.

Following the opening of 14 new restaurants and the addition of the Doppio Collection, the group’s national network of restaurants increased from 549 in the prior period to 595.


Although South Africa’s GDP growth is expected to roughly double in 2024, this is unlikely to improve trading conditions, as it will fail to address the numerous socioeconomic challenges facing the country, such as electricity and water shortages.

High interest rates and the weak rand are also set to dampen consumer sentiment, while the upcoming national elections also pose a risk to the trading environment.

Despite the challenging operating environment, the group still plans to open 41 new restaurants in South Africa and 12 internationally by the end of June. The group has also received “great interest” from its franchise network on the Doppio Collection.

Read: FNB sounds the alarm for consumers in South Africa

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