Domino's Pizza Enterprises posts 14.6% lift in global food sales
Despite this, the pizza chain downgraded their guidance.
Domino’s Pizza Enterprises' global food sales were lifted by 14.6% to $1.43 billion for the half year ending 30 December 2018, driving a 12.1% lift in EBIT to $108.3 million, the company said in an announcement.
Domino’s overseas markets said to have contributed more than half of the company’s EBITDA, with $71 million from Europe and Japan.
Online sales increased by 16.5%, $132.2 million higher than the prior corresponding period. Domino’s online platforms, meanwhile, processed 32.4 million orders in the half.
Domino’s Group CEO & Managing Director Don Meij said the result "reiterated the importance of the Company taking a long-term view" in building a multinational business.
“Europe and Japan account for more than 70% of our revenue and, more than half of our EBITDA – a testament to the depth of expertise from our team members and store managers, franchisees, and our country CEOs,” Meij said. “With a population base in our current overseas markets more than 12 times Australia, our global business provides not only a significant runway for future growth, but also a natural hedge against short term conditions affecting any single country, or region."
Locally, network sales growth in Australia and New Zealand were up by 6.2% to $592.5 million, opening 13 new stores and noting a 3.5% growth in same store sales (SSS).
Domino's ANZ CEO Nick Knight said domestic growth, while outperforming peers, did not reach "management expectations."
“We’ve come through an unprecedented cost headwind and have been able to do so because of the close work with our franchisees and customers – with new products and technology to make stores more efficient, and to give our customers great value,” Knight said. “We expected higher sales growth and a performance better than we delivered, and we will be redoubling our efforts to do both in the months ahead.”
Domino's management expects SSS for the full year to be within guidance, at the mid-to-lower end of the +3-6% range. As a result, they said, EBIT is expected to be at the lower end of guidance of $227 million to $247 million. Due to their renewed confidence in Japan and updated modelling in Belgium, Domino’s has upgraded its Group future store outlook to 4,900, or 250 additional stores, by 2025-2028.
