Spur finally gets some shareholder approval of pay policy
One of the two votes in favour of its remuneration policy passed with 77.36% of the vote, after both failed in 2018 and 2019
For the first time in three years, restaurant group Spur made some progress in winning over shareholders who voted at its AGM on its executive pay policy.
Spur Corporation, whose brands include burger joint RocoMamas and Panarottis pizza and pasta, held its AGM on Wednesday morning.
One of the two votes in favour of its remuneration policy passed with 77.36% of the vote, after both failed in 2018 and 2019.
JSE listing rules require shareholders to express support or dissatisfaction with a company’s pay policy through two non-binding votes on remuneration. If the votes do not receive a 75% majority, a JSE rule requires companies to “engage” with shareholders.
Shareholders, who allowed one vote to pass after only giving it 25% support in 2018, may have been satisfied with changes made to the bosses’ pay packages.
Spur said in its annual report it had used PwC remuneration specialists to restructure its pay and design new incentive schemes.
It met with shareholders in May, after they raised concerns that the salaries of the CFO and CEO were weighted in favour of a guaranteed fixed salary and did not include enough performance-based pay. They also said fixed pay was high relative to its competitors. Spur said in response that it had changed executive pay to include more variable pay, linked to performance.
The company introduced a malus clawback provision, which allows a company to reduce variable pay or claw it back in the case of fraud or poor performance.
However, Spur is not out of woods yet, as shareholders rejected the second vote on remuneration, which has only been required by the JSE for the past three years. This means Spur directors will need to meet with unhappy shareholders again.
Spur has had major leadership changes this year with the CEO, COO and CFO all announcing they were stepping down. Most of its 631 franchise restaurants locally and abroad were closed for at least two months due to coronavirus lockdown regulations.
During the AGM, Small Talk Daily investor Anthony Clark asked about December trade levels. Outgoing Spur CEO Pierre van Tonder said this month’s sales had bounced back to October levels after a weaker November, which it found “encouraging”.
The company previously reported October trade as 92.8% of that in 2019.
Restaurants in the Eastern Cape, where the coronavirus spike began, were the only ones that did not meenot meeting internal sales expectations for December. The group said RocoMamas was its star performer.
Asked about potential menu price increases at its brands, Van Tonder said the new management would have to decide on 2021 prices.
“Price increasing is really something that you like to stay away from strategically. I think we all understand that 2020 has been a hell of a year. And to come in with price increases in the early part of 2021 would be counterproductive [when trying] to get consumers back into your restaurants.”
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