Spur Corporation, owner of Spur Steak Ranches and Panarottis Pizza and Pasta chains said today, its profits for the current financial year will plunge by at least 40% due to constrained trading during coronavirus-related lockdowns.
The company, in a trading update released on the JSE said sales plummeted by 87.2% in May and 83.6% in June.
Spur further said Its total franchised restaurant sales declined by 21.7% to R6 billion rand due to trading restrictions in all countries of operation during the last four months of the financial year.
Outgoing CEO, Pierre van Tonder, said that the restrictions on the sale of alcohol, and the curfew imposed on all South Africans, together with customer anxiety about contracting the virus and growing personal financial stress, has had a detrimental impact on the business.
“Our primary focus at this time is on supporting our franchisees. We are discounting franchise and marketing fees and granting extended payment terms for certain debts. We expect to continue discounting fees until our franchisees experience meaningful increases in restaurant turnovers,” van Tonder said.
“The re-introduction of a total ban on alcohol sales in July together with the curfew will negatively impact trading. The grim economic outlook for the country is also likely to result in a protracted period of recovery for the restaurant industry.”
Spur this week announced that van Tonder will retire from the group at the end of December after 24 years at the helm.