RocoMamas bolsters Spur's interim results

30 Jan 2017

Spur Corporation gave a credible performance in the first half of its financial year, but its franchise, RocoMamas, sizzled in the period, growing existing restaurant sales by 45%.

Spur CE Pierre van Tonder.

Picture: Financial Mail

Spur CE Pierre van Tonder said the group had delivered a satisfactory trading performance in the context of declining consumer confidence and disposable income locally, and deteriorating economic conditions in the rest of Africa.

In a trading update, the group said total group sales for continuing operations in the six months to end December 2016 rose by 10.4% to R3.8bn while existing restaurant sales had increased by 4.1%.

"Despite the slowing economy, RocoMamas continues to show strong growth, while the robust results from The Hussar Grill highlights the resilience of the higher-income consumer," said Van Tonder.

"Our focus in the second half of the year will continue to be driving growth through value promotions, aggressive marketing and through expanding our local and international restaurant base," he said.

The Hussar Grill produced growth in total restaurant sales of 58% and growth in existing restaurant sales of 38.3%.

RocoMamas reported a jump in total sales of 113.3%. Spur Corporation acquired a 51% stake in RocoMamas in March 2015.

RocoMamas — found mostly in Gauteng — has a menu that goes beyond the typical burger joint; it is all about customisation. Known for their artisanal-style "smashburgers", the franchise also serves chicken wings and ribs as their core offering.

The smashburger concept originated from the US and refers to the process of smashing a ball of ground beef on a hot grill to seal in the juices, rather than squeezing them out.

This reportedly results in a medium to well-done burger that is juicy.

The Spur Steak Ranches eked out growth in total sales of 4% with existing restaurant sales of 2%. Captain Doregos sales fell by 15.8%.

A net 13 new outlets were opened locally during the period. Internationally, six new outlets were opened including the group’s first restaurants in New Zealand (Spur), Ethiopia (Spur) and Oman (RocoMamas).

Spur Corporation’s share price surged more than 1% in intraday trade following the release of the update.

In the past year, Spur’s share price has seen growth of 13%, putting it ahead of Taste, which is down 36% in the same period. Famous Brands leads the pack with growth of 23.39%.

Source: Business Day

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