Domino's Pizza misses full-year profit targets
It reported delay in rectifying issues with its online platform in France.
Domino’s Pizza Enterprises has reported a record full year underlying Net Profit After Tax (NPAT) of $118.5m, up 28.8% on the prior corresponding period, lifting Network Sales to increase 18% to $2,318.5m.
Don Meij, Group CEO and managing director, said the Company achieved records on multiple metrics, but Management recognised they also did not reach the targets affirmed at the Half Year results.
"We significantly lifted sales, revenue, EBITDA and margins for the group, which demonstrates that we are leveraging our competitive advantages; our scale, digital platforms, and market-leading customer-focused improvements including Project 3/10," Meij said.
“I acknowledge our results, while strong, did not reach the guidance we set. This was largely due to the delay in rectifying some issues with our online platform in France, and the initial response in H2 to our value range offering in France, which did not meet our expectations – both have now been addressed.
“We set high standards and we did not reach those high standards. I am confident we have the right strategy, and structure, in place – this has delivered, and will continue to do so, increasing sales and improving profitability in what is a high-growth business.”
According to a release by Domino's Pizza, the brand's menu enhancement, store openings, as well as the continued roll-out and optimisation of digital platforms this year have driven the strong network sales growth of 18% to $2,318.5m.
Australia and New Zealand (ANZ) recorded its fourth consecutive year of double digit network sales growth at 16.6% (+13.6% on a SSS basis), Europe recorded network sales of +26.9% (+2.8% SSS), and Japan lifted network sales +8.4% (-0.6% SSS).
Group revenue for the Financial Year (FY17) exceeded $1 billion for the first time, at $1,073.1m, a 15.4% increase. This result came from Half Year network sales of more than $1 billion, for the first time in H117, repeated in H217 with $1,162.9m. Operating cashflow in H217 increased 69.8% to $83.6m.
The results delivered a 28.3% increase in EBITDA, a record at $230.9m, building on the previous strong result to deliver a two-year EBITDA increase of $103.1m, 80.7% on FY15.
