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Franchise restaurant owner Spur Corporation may have begun recovering from the Covid-19 pandemic with an improvement in its six-month earnings - but the July 2021 unrest casts a shadow over its performance.
In a trading update on Monday, the group – whose brands include Panarottis, RocoMamas and Hussar Grill – said its restaurant sales grew by 28.3% in the six months ended 31 December 2021, compared to the same reporting period in 2020.
The 28.3% is also an improvement on the 18% growth the group saw in the six months ended 30 June 2021.
Although Spur has a good story to tell ahead of the release of its interim results this month, it still experienced some Covid-19-related restriction challenges at its restaurants, and the July unrest.
The group said the second week of the July unrest - that saw rioters loot and vandalise businesses - impacted nine of its restaurants, leaving it with R29.5 million in damages. Spur added that the unrest adversely impacted the turnover of its establishments by R14.6 million.
Despite the knock it took from the unrest, Spur said its earnings are likely to rise between 106% and 111%, with its earnings per share increasing between 75.28 cents to 77.10 cents, and its headline earnings rising between 75.27 cents and 77.09 cents.
"The franchised network continued to be supported with temporary discounting of franchise and marketing fees during the July 2021 lockdown period and KZN unrest. As trading conditions improved, the level of support required by franchisees was significantly lower than that required during the previous comparable period leading to a recovery of growth in group revenue and profit," said Spur.
