Aurum Grill operates a diversified, recurring-revenue model that layers annuity-quality franchisor and property income over corporate restaurant profits. This deliberately reduces dependence on any single revenue source and improves the quality and predictability of group cash flow.
Core revenue streams
|
Revenue stream |
Description |
Recognition basis |
|---|---|---|
|
Corporate restaurant sales |
Food and beverage sales from 20 company-owned stores |
Company revenue (full) |
|
Initial franchise fees |
One-off licensing fee of R1.8m per new franchise |
Company revenue |
|
Royalty income |
6% of franchisee turnover |
Company revenue |
|
Marketing levy |
3% of franchisee turnover (pass-through to brand fund) |
Pass-through |
|
Property rentals |
Lease income from company-controlled sites |
Company revenue |
|
Delivery & digital |
Third-party commissions and in-app promotion |
Company revenue |
|
Supplier rebates |
Procurement incentives on system purchases |
Company revenue |
Key findingSystem-wide sales versus Company revenue — the recognition distinction
Only corporate store sales are recognised at full network value. For the ~80 franchised restaurants, the Company recognises royalties, fees, marketing levies (pass-through), property income and rebates, not the franchisees’ gross sales. This is why the Company’s statutory revenue (~R1.33bn in FY2031) is far below system-wide network sales (R3.2bn). Section 19 provides the full bridge and its implications for credit and valuation.
Why the model compounds
Each incremental franchised restaurant adds royalty, levy, property and rebate income at very high incremental margin, with the store’s capital cost borne by the franchisee. This produces an asset-light growth flywheel: corporate stores prove and refine formats; validated formats are franchised; franchising scales procurement and brand reach; and procurement, property and digital scale improve unit economics system-wide. The result is a business whose margins and cash conversion structurally improve as it scales, as demonstrated in the projections in Section 20.