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.<\/p>\n
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.<\/p>\n
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.<\/p>\n
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.<\/p>\n
“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.<\/p>\n
“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.<\/p>\n
“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.”<\/p>\n
RocoMamas<\/strong><\/p>\n 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.<\/p>\n “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.”<\/p>\n As at the end of 2018, the group had 70 RocoMamas restaurants in South Africa and 11 international points of presence.<\/p>\n These included recently opened RocoMamas restaurants in India, Mauritius, Botswana and Saudi Arabia.<\/p>\n However, the group acknowledged that the brand was in a consolidation period locally.<\/p>\n 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.<\/p>\n
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