Spur takes R129.5 million legal blow

Spur told its shareholders that it had taken a provision of R129.5 million to cover damages from a lawsuit launched by GPS Food Group in 2019. 

In a statement on the JSE’s SENS late on Friday, Spur said the company plans to appeal the damages claim in its entirety. 

The company said it has been advised that it will likely succeed in this appeal, with it being scheduled for a hearing in 2027. 

This will turn the legal battle with GPS into a nearly decade-long saga for Spur, with the first summons on the JSE-listed company being served in 2019. 

In the initial summons, GPS alleged that an oral agreement was reached among it, Spur Group, and Spur Corporation to acquire, develop, and manage a rib-processing facility. 

GPS’ damages claim (Claim A) ranged between R119.9 million and R167 million. There is also an alternative delictual claim worth R95.8 million representing GPS’ alleged accumulated losses (Claim B). 

Spur and GPS agreed in 2019 to refer the matter to arbitration, which commenced on 23 October 2023. 

Spur told shareholders on 26 August 2025 that the arbitrator issued a part award in favour of GPS in relation to Claim A. Claim B was dismissed. 

On 3 August 2026, the arbitrator notified Spur that it had awarded damages of R74.6 million in relation to Claim A in favour of GPS. 

As such, Spur told shareholders on 7 August that it will raise a provision in its upcoming financial results for the damages award. 

That is not the full story, with Spur having to account for interest at the prescribed rate of 10% from the date of the original summons in 2019. This brings the total provision to R129.5 million.

“Spur intends to lodge an appeal against the award in its entirety. An appeal award would be final and binding, and there is no further right of appeal,” Spur said. 

“The group’s senior counsel has advised that it is in their view likely that the group will succeed in its appeal against the Claim A award.” 

This does not mean Spur is escaping the financial pain in the short term, with the R129.5 million provision set to significantly impact its results for the year ended 30 June 2026. 

In a trading statement, Spur said the once-off provision will result in a decline in earnings per share and headline earnings per share. 

Spur’s earnings per share are expected to fall by between 31% and 41%, with headline earnings per share falling by between 34% and 43% year-on-year. 

The company included an adjusted headline earnings-per-share metric to show how the business performed when the GPS claim is excluded. 

On this metric, Spur is expected to post growth of between 5% and 13% for the year when it reports its results on 20 August 2026. 

Spur assured shareholders that the damages award will not impact its liquidity, as it has sufficient cash reserves to cover the claim. 

The company’s liquidity position and dividend declarations thus remain unaffected by this award.