Spur CE Pierre van Tonder. Picture: FINANCIAL MAIL
Spur CE Pierre van Tonder. Picture: FINANCIAL MAIL

For the second year in a row, Spur Corporation’s shareholders have shot down the group’s pay policy, this time with an unprecedented three-quarters of the vote.

“This is a sign of the times — if you don’t perform then you are going to feel the weight of shareholder activism,” said investment analyst Chris Gilmour, citing heavy opposition to Absa’s remuneration policy earlier in the year.

As many as 74.9% of votes cast at Spur’s annual general meeting (AGM) on Thursday were in opposition to the group’s remuneration policy.

The company plans to hold an “engagement session” with shareholders, members of its remuneration committee and executive management in late January 2019.

In 2017, 51% of votes opposed the pay policy. Spur said after that AGM that investors had been concerned that its long-term incentive schemes could reward “mediocre or non-performance”.

They had also been concerned that not enough emphasis was being placed on the effective employment of capital in determining short-term incentive payments.

As such, Spur said in its 2018 annual report it had made various changes to the schemes, though the changes evidently did little to appease investor concerns.

Spur’s major investors include Grand Parade Investments, Fidelity International and Investec, according to Bloomberg data. They have had to endure a sharp decline in the company’s share price, which has fallen from a high of R39.76 in 2015 to R22.50 on Thursday.

The group’s CEO, Pierre van Tonder, earned total remuneration in the 2018 financial year of R6.2m, from R9.7m the year before.

Gilmour said Van Tonder had been a popular CEO among investors and within the group, though the company had struggled as consumer spending slowed. “They’ve gone through some really tough times recently, as have all the fast food companies.”

In the year to end-June, Spur’s restaurant sales grew just 0.6%, while comparable headline earnings per share fell 9.5%.

Spur owns the Spur Steak Ranches, Panarottis, John Dory’s and RocoMamas brands, among others.

The group said in September its middle-income customer base was facing “increasing financial pressure … with little relief expected in the short to medium term”.

The group planned to increase market share through online food delivery and “call and collect” services. It would also launch e-commerce apps and open at least 29 restaurants in SA and 14 abroad in the year to June 2019.