Posted:15-February-2011
Domino's Pizza franchise team show passion for success
DRIVEN TO DELIVER
Domino’s Pizza UK & IRL plc (“Domino’s”, the “Company” or the “Group”), the leading pizza delivery company in the UK and Ireland, announces its results for the 52 weeks ended 26 December 2010.
Financial Highlights
- System sales1 increased by 19.3% to £485.3m (2009: £406.9m)
- Strong operational gearing drives operating margins to 20.2% (2009: 19.4%)
- Profit before tax2 increased by 27.3% to £38.0m (2009: £29.9m), statutory profit before tax was £35.2m (2009: £41.0m)
- Like-for-like sales3 in 553 mature stores up by 11.9% (2009: 8.4% in 501 stores)
- Earnings per share2:
- Basic earnings per share up 25.7% to 17.36p (2009: 13.81p)
- Diluted earnings per share up 24.2% to 16.75p (2009: 13.49p)
- Total dividend increased by 31.6% to 10.20p per share (2009: 7.75p)
- 57 new stores opened in the year (2009: 55 stores) and none closed (2009: nil) resulting in a total of 665 stores at the year end (2009: 608)
- Online system sales increased by 63.0% (2009: 40.4%) to £128.0m (2009: £78.5m) with online sales accounting for 35.8% of UK delivered sales (2009: 27.8%)
- Strong cash generation with cash generated from operations of £41.0m (2009: £36.2m)
- Adjusted net debt?? to EBITDA of 0.2:1 (2009: 0.5:1), illustrating our low financial leverage.
Commenting on the results Chief Executive Officer, Chris Moore, said:
“I am delighted to report another exceptional set of results. The business has continued its remarkable run with an increase in system sales of 19.3% to £485.3m (2009: £406.9m), like-for-like sales growth of 11.9% across 553 mature stores (2009: 8.4% in 501 stores), and a record 57 new store openings (2009: 55). We have opened our new commissary and we are in a strong position to continue with our exciting growth plans.
“We have had a solid start to 2011, with like-for-like sales for the first seven weeks up 4.7% and are encouraged by the recent strength in like-for-like sales growth. This figure comes against the backdrop of exceptional comparatives from the same period in 2010 and the current difficult economic climate. We are pleased with this performance and we will be benefitting from our accelerated store openings, the recent deal with Moto motorway services, and the operational gearing which will drive our profits going forward.
“Our online sales for the first seven weeks have again proved the key driver for growth with internet sales up by 72.9% against the same period last year. With an app for the iPad and an app for android mobiles due imminently, we are confident of seeing even more business come through these channels.
“The Company is well positioned to further capitalise on our market leading position. We will continue to do what we do best – make great quality pizzas, delivered with great customer service and marketed in interesting and innovative ways. By doing this, I am confident that we will deliver another year of strong growth.”
Corporate Progress
- New commissary opened at West Ashland, Milton Keynes and now fully operational
- Around 1,700 new jobs created during 2010
- Release of iPhone app in the UK and Republic of Ireland, generating over £1m of sales in three months
- Recruited 10 new franchisees and increased average number of stores per franchisee to 5.0 (2009: 4.5)
- Delivered to 4m households (2009: 3.4m), an increase of 17.6%
- New deal signed with motorway services operator, Moto Hospitality Limited, for up to 43 sites by 2020
- Out of over 9,000 stores globally, Domino’s Pizza UK & Ireland has eight out of the Top 10 and 36 of the top 50 performing stores
- First stores opened on the Isle of Man and Isle of Wight
- Celebrated 25 years of Domino’s Pizza in the UK.
1 Sales made by franchisees from all stores in the UK and Republic of Ireland to the public
2 Pre-exceptional items
3 Like-for-like sales are sales in stores that were open before 28 December 2008
4 Excludes Domino’s Leasing Limited’s non-recourse loans and in the prior year the share buyback obligation
DOMINO'S SUCCESS SPEAKS FOR ITSELF
In order to be a winner, you have to have the best team and we have made a number of new additions during the year to further strengthen the senior management at Domino’s Pizza Group. Simon Wallis joined us as marketing director, Ian Douglas as procurement director and Colin Rees as IT director. They all come with an array of relevant experience – Simon has previously held roles at Pizza Hut and Papa John’s, Ian joined us from Pret a Manger and Colin has a wealth of online experience at Easyjet and Figleaves. In addition, we were delighted to welcome Kerri Hayman as deputy operations director. Kerri joins us from Domino’s Pizza Enterprises in Australia where she was in charge of the corporate stores. She brings lots of new ideas from some very high volume stores and will be a real asset to the operations team and the business as a whole.Domino’s, the brand, was 50 years old in 2010 and we were delighted to sweep the board at the global awards in Las Vegas. As well as taking 10 out of the top 10 records for 2009 international sales, we also took the Manager of the Year title for the fourth consecutive year when it was awarded to Steve Cubitt of the Manchester All Saints store. In addition, we proved our passion for winning when Pali Grewal, one of our franchisees, took the title (and broke the world record) of World’s Fastest Pizza Maker – the first time this coveted trophy has ever left the United States. It is this passion for being the best – and being better than we were last year – that constantly drives the business at store and corporate level onwards and upwards.
The same winning motivation has taken our business development team to new heights with record new openings in 2010. Stores have opened across the length and breadth of the country and we were delighted to open our first store on the Isle of Man in Douglas and our first on the Isle of Wight in Ryde. In both cases, we have been overwhelmed by the response and, although they obviously present a new set of challenges for our commissary deliveries, these businesses have proved extremely successful. With these 57 new stores, we have created around 1,700 new jobs, typically comprising younger people – the section of the job market that appears to be suffering most in the current economic downturn.
We are working towards our goal of at least 1,200 stores and we are looking at a raft of new and interesting opportunities to provide new locations for our franchisees and customers. We have already identified 1,249 store locations through our town print study and this gives us confidence that we can have at least 1,200 stores in the UK and Ireland.
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