Spur turnover up 28.2% to R7.7bn
Food franchise business Spur has cooked up significant recovery for the year until June, reporting double-digit growth in many key measures. Headline earnings per share were up over 30 per cent and total restaurant sales also almost reached 30 per cent, coming in slightly ahead of pre-pandemic levels. Joining CNBC Africa for more is Val Nichas, CEO, Spur.
Fri, 19 Aug 2022 15:56:37 GMT
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AI Generated Summary
- Spur's growth drivers include the mother brand and successful restaurants like Rock and Mamas
- The impact of inflation and supply chain challenges on pricing strategies and procurement
- The rise of takeaway services and virtual kitchens as responses to changing consumer preferences
Spur, the popular food franchise business, has reported a remarkable recovery for the year until June, showcasing double-digit growth in key areas. Headline earnings per share surged over 30 per cent, with total restaurant sales nearly reaching 30 per cent, slightly surpassing pre-pandemic levels. Val Nichas, the CEO of Spur, joined CNBC Africa to delve into the details of this impressive performance. Nichas highlighted the prominent growth drivers during this period, attributing the success to the strength of the mother brand, Rock and Mamas, and RoccoMamas. These components of the franchise have performed exceptionally well, contributing significantly to the overall growth. The success of these brands underscores Spur's firm foothold in the market and its ability to adapt to consumer preferences. Nichas also addressed the impact of inflation on the business, particularly in the wake of the Ukraine war, which led to increased food inflation and supply chain challenges. He emphasized the need for strategic pricing and procurement strategies to navigate the evolving landscape. While grappling with rising costs, Spur aims to strike a balance between maintaining consumer value and sustaining profitability. The CEO acknowledged the difficulty of passing on all cost increases to customers, highlighting the importance of offering a diverse menu with varying price points. One notable trend highlighted in the financial statement was the surge in takeaway services for certain restaurants within the group, such as Rock and mamas and RoccoMamas. Nichas attributed this growth to the prevailing demand for convenience, which intensified during the pandemic and has continued post-lockdown. The CEO further discussed the rise of virtual kitchens within Spur's business model, an innovative approach that leverages existing infrastructure to introduce new menu options via third-party delivery services. The successful integration of virtual kitchen brands, such as Just Wings, exemplifies Spur's commitment to adapting to evolving consumer preferences and capitalizing on emerging trends. Nichas emphasized the strategic approach to creating virtual kitchen brands, likening it to menu development focused on consumer needs, unique packaging, and distinctive flavors. Reflecting on changing consumer behaviors post-COVID, Nichas observed a shift towards discerning spending habits and a heightened emphasis on sanitization and value for money. Consumers are now more selective in their dining choices, prioritizing establishments that offer purpose and a meaningful experience. As the industry continues to evolve, Spur remains dedicated to meeting consumer expectations and delivering quality dining experiences that add value to their lives.