DOMINO'S DELIVERS "UNPRECEDENTED" RESULT

Written on the 11 February 2015 by Laura Daquino

DOMINO'S DELIVERS "UNPRECEDENTED" RESULT

DOMINO'S Pizza Enterprises (ASX: DMP) has delivered "unprecedented" results, posting its strongest profit for a half year period.

On the back of record store growth, digital and product innovation and strong Japan earnings, NPAT was up 44.2 per cent from the prior corresponding period to $29.1 million, and underlying EBITDA was up 41.2 per cent to $60 million.

Full year guidance has been upgraded across all areas, new store opening targets climbing from 175-185 to 180-200, and an upgrade on EBITDA growth guidance to 30 per cent and NPAT growth guidance to 32.5 per cent.

Shareholders will be rewarded with a fully-franked dividend of 24.6 cents per share, up 39 per cent on the dividend paid following the same period last year.

DMP CEO and managing director Don Meij described the half year performance as "unprecedented" for the company.

"We have worked hard this half to deliver strong sales assisted by the launch of our successful $4.95 Cheaper Everyday campaign.

"This price leadership, combined with strong store growth, has contributed to increased customer counts and our strongest same store sales (SSS) in four years.

"The momentum in Europe has also continued with our strongest SSS in both France and The Netherlands reported in three years.

"This has been achieved despite rolling a VAT increase in France and experiencing a tougher than usual macro environment."

Meij says same store sales grew 8.6 per cent over the period for the group.

Major markets Australia, New Zealand, Europe and Japan all set new store opening records with a total of 92 new stores added to the group.

Europe is on track to deliver its first double digit EBITDA margin year with the measure up 138 per cent from the previous corresponding period, while Domino's Pizza Japan enjoyed another record sales month of ¥4.4 billion in December 2014.

In DMP's digital space, Pizza Mogul, an app launched in July 2014 to raise customer interaction, has the registrations to confirm its success.

More than 55,000 'Moguls' have registered to date to create 160,000 different combination pizzas, with the premise of the platform being the more pizzas the creator sells, the more money they earn.

The company says the app has generated a substantial side income for customers, even paying for overseas trips and credit card debts.

"Our progressive Pizza Mogul platform has been a major sales driver for us but it's also a great example of what can be achieved when a company allows customers to champion their brand.

"We are seeing huge amounts of user-generated content being produced by our passionate pizza lovers and this goes beyond our expectations."

DMP shares are trading at $27.23 today, unchanged following the announcement.

 


Author: Laura Daquino Connect via: Twitter LinkedIn

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