Spur staring down a R230 million lawsuit

Spur currently faces an over R230 million legal case that dates back to 2019, with the decision on the final amount it owes coming later this year.

The company’s experts have calculated that its penalty should only be between R116 million and R126 million, and the group plans to appeal the initial liability ruling.

This was revealed in the company’s latest interim results for the first half of its 2026 financial year, released on Thursday, 26 February.

The lawsuit dates back to December 2019, when GPS Foods sued two companies within the Spur group over what it alleged was an oral agreement between the parties.

The agreement was allegedly made to establish a joint venture to acquire, develop, and manage a rib-processing facility.

However, GPS alleged in its lawsuit that the two companies within the Spur group broke this agreement, making two claims against the company –

• A primary damages claim of between R119.9 million and R167 million for breaching the contract
• A backup delictual claim of around R95.8 million for GPS’ alleged accumulated losses to the date of the claim

Spur has denied that the agreement existed, arguing that any joint venture required its board’s approval, which was never obtained.

The parties ultimately agreed to go the route of private arbitration, which commenced on 23 October 2023.

Closing arguments were heard on 9 December 2024, and in August 2025, the arbitrator dealt a blow to the restaurant giant, ruling that Spur is liable for damages arising from its breach of the joint venture contract.

However, now, the two sides are struggling to agree on how much Spur actually owes. GPS is demanding R233 million, plus interest, whereas Spur’s experts place the penalty closer to R126 million at the higher end.

The case will continue in April 2026, when expert witnesses will present evidence on their respective numbers, with closing arguments scheduled for May 2026.

Following this, the arbitrator will issue its final decision on the payout amount and the backup claim.

However, Spur made it clear in its recent results that it plans to appeal the arbitrator’s ruling that its companies broke the contract. The company said its legal experts believe it is highly likely that Spur will win the appeal.

According to the company, it is so confident about its chances of victory that Spur has not raised any financial liability regarding this matter.

Spur’s financial results

Spur’s latest interim results for the first half of its 2026 financial year also showed that the company is performing well, with strong revenue (8.5%) and profit (12.4%) growth.

The company explained that it delivered these results amid geopolitical volatility, economic pressure, and ongoing supply chain disruptions. 

“These challenging conditions were compounded by heightened competitor and retail activity as participants across the market intensified efforts to capture share in the meal-solution category,” it said.

“The period was also again beset with supply challenges and disruption in the food industry, most notably foot and mouth disease, which impacted the beef livestock industry in South Africa, particularly, causing supply shortages and significantly increasing beef prices.”

Regardless of these pressures, Spur managed to record a 13.9% increase in basic earnings per share to 203.61 cents.

Spur also opened up 29 restaurants across its brands in the six-month period, bringing its network to 753 locations.

Despite these strong results, if its appeal does not go the way Spur hopes, GPS’s claim could deal a severe blow to the company’s finances.

To put GPS’s R233 million claim in context, it is higher than the R172.58 million profit Spur recorded in its latest interim results.

It is also only slightly lower than the R286.75 million profit the group recorded for its full 2025 financial year.