Spur (SUR) – Meals on Wheels

Spur continued granting concessions to some franchisees, albeit less than the previous year. We quantify the impact that these concessions may have on group revenue in FY18.
The reversal of food trends in favour of restaurants and coffee shops should be a positive for SUR’s brand portfolio going forward.
Given the fast growth of online food ordering companies such as UberEats, we assess the impact on profitability of restaurants when they make use of these third-party delivery companies. We find that profit margins could be eroded if this revenue stream is not managed carefully.